Overview

BANKER & CUSTOMER – RIGHTS AND DUTIES How the banker-customer relationship is established, The rights and duties of a banker and of a customer, Bankers’ lien, Clayton’s Case, Death of a customer, Trusts, Testate and intestate succession, Electronic funds transfer THE PRINCIPLES OF LENDING The structured approach, The canons of lending, The person, Amount and purpose, Repayment, Viability, Security, Reward, Services, Credit Scoring, Credit policy CREDIT PRODUCTS AND SERVICES Overdrafts, Personal loans, Revolving credit, Credit cards, House purchase loans, Bridging loans, Term loans, Hire purchase and leasing, Self-build finance SECURITIES FOR ADVANCES Why and when security should be taken, Attributes of a good security, Security discount factors, Types of security and their discounted value, The law of property, Security over land and property, Mortgage regulation, Guarantees, Stocks and shares as security, Types of shares, Life policies, Miscellaneous securities BUSINESS LENDING The Profit and Loss account and Balance Sheet, IFRS, Ratio Analysis, Financial and Operation ratios, Cash Flow reporting, FRS 1, Balancing and reconciling Cash flow reports, Security for advances, Assessing customer needs, Alternative sources of finance, Control of advances, Cash Flow Monitoring. BUSINESS LENDING – WHEN THINGS GO WRONG Types of problems, Additional lending, Remedial action by customer, Administration, Powers of administrator, Creditors rights, Receivership, dealing with assets. Liquidation, Winding up, Liquidators powers, information disclosure, Gratuitous alienations, unfair preferences, Directors liability, Distribution of assets. CREDIT RISK PRACTICES FOR RETAIL BANKING Benefits of credit scoring, boundaries of credit scoring solutions, Behavioural scoring, Monitoring, CRAs, Higher value lending, credit risk analysis. CREDIT RISK PRACTICES FOR BUSINESS AND COMMERCIAL BANKS Market/Industry risk assessment, Business risk assessment, Financial risk assessment, Documentation and Pricing risk.

Assessment Strategy

Threshold - 50% - C Satisfactory standard: No major omissions or inaccuracies in the deployment of information/skills. Some grasp of theoretical/conceptual/practical elements. Integration of theory/practice/information present intermittently in pursuit of the assessed work's objectives.

Good - 60% -B Much of the relevant information and skills mostly accurately deployed. Adequate grasp of theoretical/conceptual/practical elements. Fair integration of theory/practice/information in the pursuit of the assessed work's objectives. Some evidence of the use of creative and reflective skills.

High Standard: 70% -A Very good performance. Most of the relevant information accurately deployed. Good grasp of theoretical/conceptual/practical elements. Good integration of theory/practice/information in pursuit of the assessed work’s objectives. Evidence of the use of creative and reflective skills.

Excellent - Excellent standard: An outstanding performance, exceptionally able. The relevant information accurately deployed. Excellent grasp of theoretical/conceptual/practice elements. Good integration of theory/practice/information in pursuit of the assessed work's objectives. Strong evidence of the use of creative and reflective skills.

Learning Outcomes

• Demonstrate an extensive, detailed and critical knowledge and understanding of how credit risk functions, and how it plays its part in managing risk for a banking business.

• Demonstrate an extensive, detailed and critical knowledge and understanding of the legal aspects of the banker-customer relationship.

• Demonstrate awareness of a range of business banking lending skills, techniques and practices.

• Demonstrate detailed knowledge and understanding of diligence and bankruptcy.

• Demonstrate detailed knowledge and understanding of the procedures for taking the range of securities for advances.

• Describe in detail the principles of lending and the main lending and credit products.

• Interpret and assess business accounts, including identifying, formulating and solving business problems and assessing and managing risk in a business banking context.