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Selecting the right borrower is the foundation of sound credit management. The Internal Credit Risk Rating System (ICRRS) plays a vital role in this process. It helps banks assess borrowers objectively and make prudent lending decisions. The importance of ICRRS…

In general, banks must follow the Internal Credit Risk Rating System (ICRRS) strictly. However, Bangladesh Bank has allowed some exceptions. These exceptions address practical situations where the standard rating process cannot be applied. Newly Established Companies A newly established company…

Bangladesh Bank introduced the Internal Credit Risk Rating System (ICRRS) to measure borrowers’ creditworthiness objectively and consistently. The system helps banks to assess credit risk before approving or renewing credit facilities. Different sectors have different characteristics. They differ in terms…

Financial statement analysis uses different analytical tools to evaluate a company’s financial performance and position. The three most commonly used tools are discussed below: Horizontal Analysis (Trend Analysis) Horizontal analysis evaluates financial data over a period of time. It measures…

 Purposes of Credit Investigation Credit investigation serves several important purposes. It helps the bank make safe and informed lending decisions. The main purposes are as follows: Confirming the Borrower’s Character Credit investigation verifies the borrower’s integrity, reputation, and willingness to…

From the reporting entity’s viewpoint, financial statements are the means of reporting economic activities to stakeholders. From the investor’s viewpoint, they are a source of reliable information for economic decisions. As per International Accounting Standard-1 (IAS-1), a complete set of…