Global Credit

Exposure Management

Policy
 Reduction in margin:
5% by COCC – GM MARGINS
• For Agri Loans: 10% by COCC - ED
Particulars Margin
Loan Limit up to Rs. 1,00,000 Nil
Crop Loans (irrespective of limit) Nil
Loans for purchase of Tractor and Heavy Agril. Machinery 25% *@
Other Agriculture Loans 15%
Agri-Clinics & Agri- Business: Up to Rs.5.00 Lacs Nil
Above Rs.5.00 Lacs 15%

• (*) For Small/Marginal Farmers, Agriculture labourers and other specified categories, no margin by borrowers is
required where subsidy is available under special development programmes/ Govt. sponsored Schemes.
(@)Excluding the 3 new tractor schemes.
Facility Particulars Margin
• For food & Agro units:
Term Loan Land & Building 30%
• Warehouse, silos, godowns.
Plant & Machinery and Equipment (New) 25%
• Cold storage Working Capital Stocks and receivables 25%
Export credit 10%
 MARGINS
• C &IC, EC / MSME Loans:
Facility Type of security Minimum Margin
Factory Land & Building 30% Next Higher Authority can
Term Loan reduce margin by 5% & up
Plant, Machinery, Equipment
 25%
to 10% by COCC - ED
Second hand imported machinery 40%
Stocks & Receivables 25%
Working Capital
Pre Shipment 10%
Export Credit
Post Shipment Nil

• Real Estate Exposures:

Description Margin %
Overall Margin for Real Estate Projects 35% of project cost
Out of above overall margin, minimum contribution by way of own funds
and quasi capital should be. 20% of project cost
(For this purpose, quasi capital should not be more than 50% of net
worth / net owned funds)
 MARGIN
• Capital Market Exposure & Commodities under Selective Credit Control:
50%
• LABOD/ ODBOD: 90% in general cases; 95% in special cases(Monthly int to be
served).
• Under exceptional cases RM can allow upto 50.00 Crs & ZM up to 100.00 Cr
and ED for any amount with NIL margin.
• For overseas, with NIL margin up to USD 5 mn by territory head in the rank of
AGM/ DGM and up to USD 10 mn for GM & above.

• LABOD against MIP/ QIP – Monthly interest to be served.

• For finance to NBFCs against second hand assets financed by them, margin
in the range of 40% to 50% shall be prescribed
 WORKING CAPITAL ASSESMENT
Entity Limit Assessment Method
Up to 5.00 Cr Higher of First method or Turnover method (30%@ /25% - digital)
Micro & Small
Above 5.00 Cr Higher of First method or Turnover method (20%)
Medium Any limit Higher of First method or Turnover method (20%)
Up to 10.00 Cr Second Method
All other borrowers
Above 10.000 Cr Cash Flow method
Overseas Up to USD 1.00 mn or equivalent Turnover method (20%)
Above USD 1.00 mn or equivalent Cash flow based method

@ In case digital sales turnover exceeds 25% of the total/ assessed turnover, additional 5% of the
digital sales turnover will be added to the total assessment of working capital.

i.e. 30% of turnover for Digital sales and 25% of non-digital sales added together will be the working
capital limit
 TERM LOAN ASSESMENT
• The computation of cost estimates shall be carefully scrutinized to ensure that the
total project cost arrived at is accurate, comprehensive, reasonable and realistic.
• Source and quality of equity capital brought in by the promoters /shareholders must
be ascertained
• It should be ensured at the time of credit appraisal that debt of the parent company
is not infused as equity capital of the subsidiary
• Whenever LC within term loan for equipment/machinery is sanctioned, it is treated
as single limit for the purpose of determining the credit exposure.
• Repayment period is 3 to 15 years. Schematic guidelines will supersede. For
infrastructure finance, morethan 15 yrs is allowed.
• 15% of margin should be from core promoters.
• For project loan, infusion of 50% of equity should be from Promoters’

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 Non Fund Based
• LC & BG limits in connection with WC requirements should be worked out within WC
Limits as per MPBF. BG not to a Non customer

• Margin against LCs & BGs shall not be funded through Fund Based Working Capital.
• Further, wherever warranted, a lien will be maintained on the unutilised portion of
the cash credit account for the value of the bills to be received under the LC / BG.
• In the case of LCs for import of goods, utmost care and vigilance should be observed
while making payment to the overseas suppliers on the basis of shipping documents.
• Credit exposures falling within the DLP upto DNCC, minimum cash margin of 20% on
LC/BG exposure. ZOCC – GM COCC – CGM up to 10% margin. COCC – ED full
• Maturity period BG is 5 yr in normal case. BG can be issued for more than 5 yrs
approval of next higher authority, subject to
• issuance of BG should be linked to the business of the borrower
• 100% cash margin or counter guarantee of another bank. Exceptions: DGSD, Customs Dept, GOI
• No Guarantee should be issued for unlimited amount and/ or unlimited period.
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 BENCHMARK RATIOS
The indicative benchmarks for key Ratio General Micro & Small Medium Acceptable
financial ratios are as under: Benchmark incl. Enterprise Enterprise Level
expanded SME

Current Ratio (minimum) 1.33 1.17 1.20 1.00

D- E Ratio TTL/ ATNW (maximum) 3.00 3.00 3.00 4.50
D- E Ratio TOL/ ATNW (maximum) 4.50 4.50 4.50 5.00
Fixed Assets Coverage Ratio (min) 1.25 1.25 1.25 1.25
Average (DSCR) (minimum) 1.75 1.75 1.75 1.20
Minimum DSCR in any year 1.25 1.00 1.25 1.00
Interest Coverage Ratio 2.60 2.25 2.50 2.00
Total Debt / EBIDTA 5.00 6.00 5.50 6.00

• the approved product / scheme-specific guidelines will be applicable in respect of

their indicative benchmark financial ratios
 Current Ratio
• For MSME (Regulatory & expanded definition) accounts,
while calculating current ratio, TL installments falling due in
next 12 months should be excluded, provided the projected
cash flows generation is more than the projected
installments of Term loans.
• Further, FDR kept as margin for BG/LC maturing within next
12 months should be treated as current assets.
• For Export oriented MSME Units (having more than 50%
turnover from export activities), the indicative benchmark
current ratio is 1.10
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 DE Ratio
• ATNW- Adjusted Tangible Net Worth, adjusted to Investments in / Loans
& Advances to group companies.
• Debt-Equity Ratio: Sub-ordinated debt (viz. long-term unsecured loans
from friends and relatives etc.), will be added to ATNW (up to 100% of
ATNW for non-corporate borrowers and up to 50% for corporate
borrowers) for the purpose of computing Debt-Equity Ratios, provided
the borrower retains the same at the existing level/projected level during
the currency of the Bank loan

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 TEV Study
• No TEV study for 25.00 Cr, in case, the authority, at least in the category of Regional Head, feels
that the project needs Techno- economic Viability study, the same may be referred to Bank’s technical
officer posted in the Zone or empaneled consultant for carrying out TEV study.
• For projects above Rs. 25 crore and upto Rs. 100 crore: by the Bank’s Technical
Officer posted in the Zone or by an empaneled consultant.
• For projects above Rs. 100.00 crore: by the Bank’s Technical Officer/s posted in Project
Finance Division at BCC.
• TEV study of the project costing up to Rs.100.00 crore carried out by other
banks can be accepted, if-
i. The bank is one of the first 30 scheduled commercial bank by the size of assets,
ii. It is taking exposure for at least 10% of term loan component ,
iii. In the project under reference, the Bank’s exposure shall be less than or equal to the
exposure of the other bank.
iv. If project cost is above Rs. 100.00 crore, it can be accepted, subject to vetting by the Bank’s
Technical Officer/s posted in Project Finance Division at BCC
 TEV Study
• In case, the TEV study of the project with cost of above Rs.100.00 crores has been done
by agencies of repute, such as Tata Consultants, Engineers India Limited, KPMG,
Deloitte, E&Y ,PWC, BDO , Grant Thornton etc. It can be accepted by the Bank, subject
to vetting of the TEV study by the Bank’s Technical Officer/s posted in Project Finance
Team at BCC. For more than 100 cr project, he same is vetted by another professional
agency.
• when DPR (Detailed Project Report) is prepared by one of the agencies, as above,
namely Tata Consultants, Engineers India Limited, KPMG, Deloitte, E&Y, PWC, BDO,
Grant Thornton etc. and the same is vetted by another professional agency.
• Waiver of TEV Study:
• For project cost above Rs. 25 cr to 50 cr  COCC- CGM based on
recommendations of RM/ ZM/ CFS Head TEV Study restructuring A/cs
– Above 500.0 Cr
• Project cost of Rs. 50.00 cr & above  COCC-ED & above
 TEV Study – Restructure A/cs
• TEV study done by the lead bank, where our bank is member, can be accepted.

• If our bank is leader in consortium, where project cost up to 500.00 Cr, TEV
study by empaneled consultant shall be accepted.

• If project cost is above 500.00 Cr, TEV study to be done by our technical officer
at BCC.
• PCE: Partial Credit Enhancement
 Export Credit
• Export finance is broadly classified into two categories-
a) Pre-shipment finance (180 days) b) Postshipment finance
• Export credit limit in Foreign Currency will be sanctioned in one of the convertible
currencies viz. US Dollars, Pound Sterling, Japanese Yen, Euro. The FC component of
export credit outstanding will be maintained and monitored in FC.

• Pre-shipment credit to exporters is normally provided on lodgment of LCs or firm

export orders
 Import Credit
• Hedging for import credit:
• Sight LC: Hedging not required
• Usance LC: Hedge the transaction at the time of Receipt/Acceptance of Import
documents
• Provision of cash margin in lieu of Hedging:
Cash Margin as % of Import LC Transaction Sanctioning Authority
10% and above and upto 15% Branch Manager
8% and above but below 10% RM
5% and above but below 8% ZM

• Charge additional 0.50% p.a. commission, if customer is not willing to provide cash
margin in lieu of Hedging
• branches are prohibited from issuing LOU/LOC 20
 Take Over Accounts MSME &
• Corporate
The specific reasons for shifting the account should be ascertained.
• Accounts of profit-making concerns as per last two audited balance sheets.
• Account should not have been classified under SMA-1 / SMA-2 during the last one year as per
the latest CRILC report. Account statement 6 to 12 months to scrutinize.
• Bank should obtain necessary credit information from the transferor bank as per the format
prescribed and also to obtain Credit Report from the existing lenders, Branches to make discrete
inquiries with people in the similar line of activity / buyers / suppliers
• External Rating for exposure above Rs.50 Crores should not be below BBB & equivalent.
• There should be tangible security available to cover the advances 0.25% Upfront charge to be collected in
• Securities to be revalued at the time of takeover of account all MSME takeovers with deviations
• Minimum BOBRAM Rating should be BOB6 or MSMEBOB6.
takeover should be at the existing
• No rescheduling / restructuring in the account during last two years exposure level only. Additional also
• Authority for Take over: CM & above –Nil; Upto Scale3 – RM. can be
• Deviations: Next higher authority up to COCC – CGM. Full powers for COCC - ED
• If credit facility to be taken over from other banks where any of the Bank's current Executive Director
or Managing Director & CEO worked earlier – for any amount – MCB is the authority
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 Take Over Accounts Retail
• Loans
Good Retail Loan accounts from other
norms.
Banks / HFCs / NBFCs/ FIs etc as per our

• After considering income, repayment capacity and age fresh repayment period &
EMI may be fixed.
• Additional funds as per requirements may also be considered.
• For takeover of loans, no prior clearance is required from RO/ ZO/ BCC.
• No re-scheduling / restructuring in the account during last two years
• Account should not have been in SMA-1 / SMA-2 during the last one year.
• branches should ensure the minimum stipulated margin and LTV Ratio.
• The amount of loan may include the o/s bal, foreclosure fee and stamp duty for
creation of EM in the Bank’s favour subject to margin, income and repaying capacity
criteria, Loan to Value (LTV) ratio etc.
• Fresh valuation of property to be obtained. (sale deed in 3yrs)
• In case of takeover of retail loans(including HL), realisable value of the property is
to be considered.
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 Take Over Accounts Retail
• Loans
All the collateral securities charged to the previous lender institution from whom
the loan is being taken over should also be made available as security to the Bank.
• The foreclosure Letter & List of documents in respect of property mortgaged to be
obtained from the customer at the time of submission of application. However, in
the case of takeover of HL, the same should be insisted as a pre-disbursement
condition instead of being a pre-processing condition.
• The disbursement of the loan should be made directly to the bank/HFC/NBFC
• The prospective borrower should handover a Power of Attorney in favour of the
Bank along with a letter addressed to that bank/ FI authorizing them to deliver all
documents and all the collateral securities charged to them, directly to the Branch.
• If credit facility to be taken over from other banks where any of the Bank's current
Executive Director or Managing Director & CEO worked earlier – for loans up to
5.00 Cr - ZOCC – GM, 5 to 10 Cr – COCC - CGM & 10.00 Cr & above – COCC – ED are
the authority.
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 Take Over Accounts Retail
• Loans
In case takeover of Retail Loans, advocates can provide TCR/ Legal opinion based on
the photo copies of the Title Deeds, supported by its Certified Copies. Authenticity
of original Title Deeds is required to be ascertained immediately upon the receipt
of the original documents from existing lenders subsequent to the taking over of
the account and disbursement of loan.
• Branches must ensure that the borrower/ mortgagor has discharged/ released the
charge created over the properties by the previous banks.

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 Take Over Accounts Agri Loans
• Profit making as per last ABS.
• Account rating should be minimum BOB6.
• No rescheduling / restructuring in the account during last two years
• Account should not have been in SMA-1 / SMA-2 during the last one year.
• All other existing norms, guidelines to be scrupulously followed.
• For limit up to 10.00 lacs no permission is needed.
• For exposures above 10.00 lacs – for up to scale 3 – Prior permission is needed.
• For Scale 4 & above, for any limit – prior permission is not required.

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 TAT
.Type of Credit Facility Time frame for disposal
PRIORITY SECTOR
Up to Rs.25,000 Within -1- week
Above Rs.25,000/- Branch Level Within -10 working days
RO/ZO level Within -15- working days
BCC Level Within -30- days
RETAIL LOANS As prescribed at product level but not beyond:
Branch Level Within -10 working days
RO/ZO level Within -15- working days
BCC Level Within -30- days
MSME LOANS Time frame for disposal
For credit limits up to Rs.5/- lakh Within -1- week
For credit limits above Rs.5/- lakh and up to Rs.25.00 lakh Within -10 working days
For credit limits above Rs.25/- lacs Within -15- working days
For credit limits above Rs.25/- lacs if TEV study involves 15- working days + 2 weeks
 Credit Processing
• Rejection of Educational Loan applications and SC / ST Borrower’s applications should
be done at the next higher level instead of at the branch level and reasons of
rejection should be clearly indicated.
• 4 eye principle.
• Due diligence, Security Valuation, Pre-sanction Inspection, Legal Opinion from
empanelled Advocate, Internal Credit Rating, Techno- economic viability study,
Financial data analysis, evaluation of credit proposal, including all types of risks,
assessment of required limits, RAROC computation.
• Credit information report from CIBIL, EXPERIAN, EQUIFAX and HIGH MARK. (CRIF)
Segment CIR to be from TWO agencies
HL 10 & above
Retail
Other retail loans 5 lacs & above
Commercial 25 lacs & above

• Not required for Staff loans, JLs, Loans to Govt/ PSUs & LABOD
 Bureau Norms
• Credit vision Algorithm: BCC:BR:114:279
Vintage of Customer Limit Applicable CMR rank Hold/ Control

NTB Up to 01.00 Cr CMR 6 Next higher

NTB 1.00 Cr to 50.00 Cr CMR4 to CMR6 Next Higher for CMR6

ETB - RWI – MSME Up to 50.00 Cr CMR6 Next higher

No algorithm for CMR 1 to CMR3 and UNRANKED
Any Reject case – Approval by COCC – CGM (CMR4,5) & COCC – ED (CMR6)

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 Credit
Processing
• EDD is to be carried out in respect ‘High Risk’ as defined in the Bank’s KYC- AML- CFT Policy
including Politically Exposed Persons (PEPs). List of shareholders having 5% and above shareholding OFAC
• Valuation: CFR
CFT
• The property should be valued by Bank’s approved valuer at the time of sanction.
• The valuation report should contain the value of the property as per present Government
rate along with Market Value, Realizable Value and Distress Value. Lower of realizable
value / market value of asset should be considered.
• In case of investments to /from exceeds 10% and above of TNW of our corporate borrower.
• If sales or purchase exceeds 10% of annual sales/purchase
 Credit
• Generally to consider RV. HL take over also RV. Processing
• Revaluation to be done once in every 3 years.
• Lower of Registered Value & Realisable value to be considered, if property purchased
within 3 years. If RV is higher than registered value, then RMMC & above are authority to
consider RV. Type of Property Value of property
• 2 Valuation reports All Metros, B’lore, Hyd, Chandigarh tri city Other centers

Lower of RV of both Residential Above 5.00 Crs Above 2.00 Crs

Commercial Above 5.00 Crs Above 2.00 Crs
valuation reports
Industrial Above 10.00 Crs Above 5.00 Crs
Agri Above 2.00 Crs Above 1.00 Crs
• Retail advances: Age of property should not be more than 25 yrs.
• If property age is more than 25 yrs, Sanctioning authority can consider tenure up to
residual period without deviation.
• Other than retail advances: Residual period should be 5 yrs more than tenure.
 Credit
• For Agri advance: Up to 10.00 lacs no valuation from empaneled valuerProcessing
is required.
Valuation to be done local enquiries or 500 time of value prescribed by revenue authorities.
• For Agri advances above 10.00 lacs: Valuation to be done.
• Valuation of P&M: Based on purchase price and after that WDV value as per ABS.
• Used machines: Economic life should be at least for 5 years and tenure should be within
that. Lower of Cost of acquisition or as per TEV study or Valuation report of panel valuer.
 Credit
• Valuation of Sugar Stocks: Processing
• unreleased stocks of the levy sugar shall be valued at levy price fixed by
Government.
• The unreleased stocks of free sale sugar average of the price realised in
the preceding three months or the current market price, whichever is
lower.
Frequency of Govt. securities Debt Securities Gold LIC / NSC / KVP Units of MF
valuation of
Financial
Security Daily Daily Daily Annually Daily

• in case of NSC and KVP it has to be ensured that there is no lock in period
 Credit
• Validity of the sanction: Processing
WC TL WC & TL together
Validity of sanction 3 months (FB & NFB) 6 months 6 months
Enhancement As above
Revalidation of sanction will not extend the date of original / latest sanction for calculation of due date of review.
if sanction is accepted unconditionally, documents were executed as per above and 50% processing charges have been
recovered, in such cases, sanction will remain valid for a period of 9 months from the date of sanction

• For overseas territories: 4 months. For project loans – 6 months

Revalidation can be done max -3- times consecutively, total period of 1 year from initial sanction.
If it crosses 1 year, The loan has to be processed again
 Credit
• Penal Interest: Processing
Penal Delay in
2% penal Submission of financial statement, stock statements, creation of security,
quarterly information, overdues, breach of stipulated covenants
2% penal/ additional Interest The term loan / working capital limit accounts defaulting installment /
interest repayment on advances other than Priority Sector loans up to Rs.
25,000/-, Loans sanctioned under Government Sponsored Schemes
Govt Sponsored Scheme No penal interest

• Commitment charges: To be calculated on quarterly basis.

Type of Advance Minimum utilization Commitment Charges
FBWC 1.00 Cr & above 60% of sanctioned/ Operative limit 0.50% of unutilized portion below 60%
NFB 1.00 Cr & above 50% of sanctioned limit 0.25% of unutilized portion below 50%
 Review Mechanism
• PSR to be sent within 3 days of sanction:
Branch Area Other than Retail Retail advances - Fresh Retail advances - Review
Metro & Urban 25.00 lacs & above 5. 00 lacs & above HL – Above 25.00 lacs
AL – Above 10.00 lacs
Rural & Semi urban 10.00 lacs & above

• The PSR authority clear within a period of –30- days from the date of receipt of proposal
else it will be presumed that the proposal is cleared from PSR angle.
• Disbursement authority: New format – BCC:BR:112:377 Dt:29.06.2020
• CERSAI Search: BCC:BR:112:430 Dt:22.07.2020
• BD to be considered 90 days. 90-180days - ZO is authority; above 180 days: COCC - CGM
• Annual Cap: Staff Accounts + Adv against Own Deposits/ NSC/ KVP/ IVP/LIC/ Relief bonds
+ Reviews + Govt sponsored schemes & to weaker sections are not to be considered.
 Review Mechanism
• Review: All to be done at Annually. But for 10.00 cr & above, where rating BOB7 & below review to
be on half yearly.
• Short review: 3 months. But in any case regular review should be done within 180 days from due
date
• Advances accounts with limit up to Rs. 25 lacs for facilities in trading activities, MSEs, borrowers in
rural area, borrowers having only term loan accounts, financed under government sponsored
programme, borrowers enjoying only guarantee facility  review without Financials can be done
provided rest all stands good. But to get in reasonable time.

• Review of existing facilities with no change in terms and conditions:

• The sanctioning authority or sanctioning committee upto COCC-GM shall exercise the delegated
powers of next higher Scale or Committee., except below cases:
• There is no downgrading in internal credit rating (Obligor) (by two or more notches upto BOB 5 rating
grade and 1 notch thereafter) during the review period, and
• Latest rating is minimum BOB-6/MSME BOB6 as per BOBRAM/BOBICON / MSME credit rating system.
• If facility remained in SMA1/ SMA 2 beyond 90 days during the review period, the facility should be
reviewed by the respective sanctioning authority.
 Review Mechanism
• In case of RWI/ additional fresh limit, if account remained in SMA1/ SMA2 for beyond 90 days, then
it shall be referred to next higher authority for sanction.
• Security: No security for MSME upto 10.00 lacs. Revaluation 3 yrs  Domestic/ Overseas. For STD HL
variants – No need of periodic valuation.

• Asset Verification:
Primary security Fixed Assets Collaterals
For working capital as per BOBRAM rating BOB1, 2, 3 Quarterly Half Yearly Annually
MSME BOB1, 2, 3 Jan & July
BOB 4, 5 Once in 2 month
MSME BOB4, 5
BOB6 & below Monthly
MSME BOB 6 & below
Excluded from BOBICON. Below 2.00 lacs Others Half yearly
(MSME) & below 25.00 lacs (other than MSME)
 Review Mechanism
• Unit visit/ Visit to the borrower:

S. No Sanctioning authority Periodicity of field visits

1 Accounts up to DLP of BM By Branch bi annually
2 Accounts up to DLP of ROCC By RO official annually
3 Accounts beyond DLP of ROCC By ZO official annually
4 For accounts where obligor (borrower) credit As decided by ZO/ RO as the case
rating has slipped by two notches demanded

3 line of defense:
- Customer Relationship Department
- Risk Management
- Audit Department
• Legal vetting:
• 10 L to 2.00 cr – Panel advocate
• 2.00 cr above – Bank legal officer
• 2 – 5 cr – Bank legal officer + Panel advocate (Metro + APJ)
 Review Mechanism
• Credit Audit: a) Loan Review Mechanism b) Loan Documentation Audit c) Credit
Concurrent Audit d) Onsite Credit Audit
• 6 months (7days from Disb) from DOS by Credit Audit Cell with CIAD(Central Insp & Audit Dept)
• All fresh & reviews of Rs. 10.00 cr & above (FB &NFB) (MSME, Retail, Restructured)
• 5% of fresh sanctioned 1-10 cr & RWI 1-10 cr
• Fresh Sanctions & RWI of 1 cr & above (FB & NFB) of sister concern account mentioned
above.
• Excl: All 100% liquidate/ NSC/KVP & short reviews, Short term clean loans, NPAs.

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 Review Mechanism
• Credit Audit:
• 5-Pt alert under credit Audit Check List
• Late intimation of date of disbursement (not on the same day) for Credit Audit by the Branch – (Same
day to be done)
• Absence of Pre-Sanction & Pre -Disbursement inspection
• Inadequate Insurance or No Insurance
• Pending Vetting of Documents /Account not covered under Legal Audit
• Release of facility without proper Disbursement Authority/ Noncompliance of critical pre-disbursement
conditions stipulated in sanction
• Commented / Compliance report of the Credit Audit report is to be submitted within -30- days by the
Branch to controlling authority.

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 Review Mechanism
• Stock/ BD audit: Working capital limit (FB & NFB) of 1.00 cr & above
• Borrowers consistently rated A and above for the latest two years (where external rating is
available): Annually
• Other case of 5.00 cr & above - bi annual ------ 1.00 cr to 5.00 cr – annual
• No Stock/ BD audit if limit is below 1.00 cr and where there is no WC limit & BPP.
• Stock/ Book Debt audit of other banks (MBA/ Consortium) also can be acceptable.

Proper insurance to be taken n be ensured to renew them annually.

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 Review Mechanism
• CREMON/ MMR:
Exposure Monitoring Authority Mechanism
10 Cr & Above CRM/ BCC Status as on 15th of every month
5-10 Cr ZH/ CEO of Overseas territory As of 15th & remedy by 25th
1-5 Cr RH/ CEO of overseas territory As of 15th & remedy by 20th
Below 1 Cr BM
1-5 Cr (Below BOB6 rating) BCC

• MMR: 25.00 lacs to 1.00 Cr to RO

• Agencies for Specialised Monitoring: for all exposures above 250 Cr.
• Credit Monitoring Agencies (CMA) will be appointed for other than project loans
• Project Monitoring Agencies (PMAs) will be appointed for monitoring project loans

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 Curing policy
• DCCO:
S. No Project Loans
Infra Non Infra
1 2 yrs from DCCO 1 yr from DCCO
2 Further 2 yrs to point no. 1 (if court case involved)
Total 2 + 2 = 4 yrs
3 Further 1 yr to point no. 1 where delay is beyond control Further 1 yr to point no. 1
Where delay is beyond control
4 For CRE projects: 1 yr from DCCO; +1 yr Beyond Control

• Hand holding/ Cut Back Arrangements: Hand holding for 2 months.

(entire amount can be utilised by borrower)
• Cut back arrangement – 5% may be retained by bank and rest can be
utilised by borrower 45
 Curing policy
• Credit Systems:

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 Conversion of Limits
• Substitution of Securities:
• In case the value of substituting security is either equivalent to or more than the
security to be substituted, respective sanctioning authority can consider security
substitution with adequate due diligence upto ZOCC - GM level.
• Interchangeability of limits:
• Interchangeability between guarantees and LCs
• Conversion from NFB to FB limits or two-way Conversion is allowed subject to
following:
• NFB limits (only Letter of Credit Limits and Advance Payment Guarantee
for procurement of stocks / raw materials) to FB. Similarly, FB to NFB for
purchasing stocks only.
• Post conversion, FB & NFB should be in MPBF.

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