KRISHNA PRASAD GWACHHA

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KRISHNA PRASAD GWACHHA USES OF FUND PREPARED BY KRISHNA PRASAD GWACHHA 11/9/2018

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LOAN AND ADVANCES Loans and advance is one of the main products of the bank through which the banks make interest incomes. The sum of the outstanding amount of all loans and advances extended to the customers as well as bills purchased and discounted less the amount of Loan Loss Provisioning shall be exhibited. Loan to employees provided according to the Employees Byelaws of the licensed institution shall be exhibited under "Other Assets" of the Balance Sheet and not under this head. 11/9/2018

CREDIT PRODUCTS AND THEIR FEATURES ON THE BASIS OF PURPOSE Consumer loan: Business Loan: ON THE BASIS OF BORROWERS NEEDS Short term loan: Long term Loan: ON THE BASIS OF SECURITY NEEDS: Secured Loan: Unsecured Loan: 11/9/2018

CREDIT PRODUCTS AND THEIR FEATURES ON THE BASIS OF NATURE OF ACCOUNTS: Term Loan: Overdraft Loan: ON THE BASIS OF FUND: Funded Loan: Non Funded Loan: OTHERS: (home loan, equipment loan, land purchase loan, consortium loan, SME loan, agricultural loan, auto loan, educational loan, hypothecation loan, margin lending, gold loan, loan against fixed deposit etc.) 11/9/2018

INTERBANK LENDING The banks lend to each other in large volumes at low cost for periods ranging from overnight to a few months. These interbank loans are the marginal source of funds for many banks. Even for banks that are mostly funded by deposits, interbank loans may be a critical source of additional funds. Interbank lending contributes greatly to the efficiency of banking and of financial markets generally. 11/9/2018

INTERBANK LENDING It helps satisfy temporary, localized excess demand for funding liquidity that is needed for the smooth function of other financial markets. Confidence in their trading partners usually allows banks to lend to each other even without collateral. The market for interbank lending helps deliver funding liquidity to the banks that need it that day or week, and allows banks with a temporary excess of cash to invest it reliably. The market is large and active. 11/9/2018

MAINTAINING RESERVE 1. Cash Reserve Ratio (CRR): Cash reserve ratio is the minimum amount of cash required to be placed/deposited at central bank. The licensed banks and financial institution of classes 'A', 'B' and 'C' shall have to maintain the cash reserve ratio (CRR) at the rate 6%, 5%, and 4% of total deposits respectively. The average CRR maintained by the commercial banks in the review year is 10.22 percent. 11/9/2018

2. Statutory Liquidity Ratio Statutory liquidity ratio (SLR) is the minimum amount of liquid assets the bank has to maintain. The licensed banks and financial institution of classes 'A', 'B‘ and 'C' shall have to maintain the statutory liquidity ratio at the rate 12%, 9%, and 8% respectively. The average SLR of the commercial banks in the review year is 25.27percent. 11/9/2018

INVESTMENT 1. MONEY MARKET INVESTMENT Money market is the market where short term securities having the maturity of one year or less are traded. It is used as a means investing for short term. The investment in government securities such as development bond and Treasury bills shall be done for the purpose of maintaining SLR and managing returns and liquidity. Dealers should ensure the benefit from the purchase of bond and Treasury bills. 11/9/2018

Quotation T-Bond Quotation Treasury Bill Quotation Rate Maturity M/Y Bid Asked Change Ask Yield 9 3 8 Feb 18 122:26 106:30 -16 8.56 Maturity Days of maturity Bid Asked Change Ask Yield Aug 29, 2017 90 5.04 5.02 +0.02 5.17 11/9/2018

CAPITAL MARKET SECURITIES Capital market securities are the security having the maturity period of more than one year. Capital market provide for the buying of long term debt and equity. This type of market is composed of both the primary and secondary markets. Bank shall make the long term investment in capital market instruments such as government bond, corporate bond or debenture, preferred shares, and equity shares. 11/9/2018

Thank You!! 11/9/2018