An internship report on Credit Policy and Operations of Mutual Trust Bank

An internship report on credit policy and operations

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An internship report on “Credit Policy and Operations of Mutual Trust Bank Limited” 19
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2. Inland Bill Purchased (IBP): Mutual Trust Bank Limited started granting of credit facility against Inland Bill Purchase by issuing the Instruction Circular No.243 dt. 17-01- 99. subsequently certain amendments have also been made thereto vides Credit Division. All concerned are hereby instructed to observe the following procedure for granting of credit facility against Inland Bill Purchase (IBP).Only those bills will be purchased which arise out of genuine business transactions of manufacturing units/concerned. The concerned branch allowing IBP facility must see that the bill has been drawn by the party himself and he is not the purchaser of goods/services or endorser of the bill. The applicant requesting for IBP facility will have to submit all the shipping documents as required in the ILC opened by buyer's bank. The following papers and change documents are to be obtained/ executed by the party before allowing IBP. Loan application ( as per format in annexure 'A') Single/ Double Party DP note (AS applicable) DP Note delivery Letter (where guarantor exists) Letter of continuity Revival Letter Form-I Revival Letter Form-II (where guarantor exists) 4. Foreign Documentary Bills Purchased (FDBP): Payment made to a customer through purchase/ negotiation of a foreign documentary bills falls under this head. This temporary advance is adjustable from the proceeds of the shipping/export documents. Its falls under the category” Export Credit". 5. Loan against Imported Merchandise (LIM): Advances allowed for retirement of shipping documents and release of goods imported through L.C. taking effective control over the goods by pledge in brokerage house under bank's lock & key fall under this type of advance. This is also a temporary advance connected with import which is known as post-import finance and falls under the category "Commercial Lending.” Loan against the merchandise imported through bank maybe allowed pledge of goods retaining margin prescribed on their landed cost. An internship report on “Credit Policy and Operations of Mutual Trust Bank Limited” 20
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6. Loan against Trust Receipt (LTR): The Trust Receipt is a document that creates the Banker’s lien on the goods and practically amounts to hypothecation of the proceeds of sale in discharge of the lien. On the arrival of goods and lodgment of import documents, importer may request the bank for clearance of goods from the port (custom) and keep the same to bank go down. Proper sanction from the competent authority is to be obtained before clearance of consignment. For giving these types of loan, officer makes loan proposal and sends it to H/O for approval. After getting approval from H/O, bank grants loan in the form of LTR. The customer holds the goods or their sale-proceeds in trust for the Bank, till such time, the loan allowed against the Trust Receipts is fully paid off.
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  • Fall '19
  • Debt, Interest, Mutual Trust Bank Limited, Credit Policy and Operations

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