Credit Risk Management System of Uttara bank Limited

Abstract

Uttara bank is one of the largest and oldest private-sector commercial bank in Bangladesh with years of experience. Adoption of modern technology both in terms of equipment and banking practice ensures efficient service to clients. Uttara bank limited had been a nationalized bank in the name of Uttara bank under Bangladesh bank. Commercial banks lend money to different categories of borrowers for various purposes with a view to generate revenue. Accordingly, while processing and appraising loan proposal, banks essentially analyze the information relating to borrowers, assess the purposes of loan and determine the viability of the loan proposal is sound and safe for lending, loan is sanctioned and disbursed. This paper analyses the impact of credit risk management practice and credit disbursement process of Uttara bank limited. To analyze the effectiveness of their credit risk management practices and process data sources gathered from primary data sources including practical banking work, personal discussion with the offers and executives of UBL and personal interview with the customer and from secondary data sources including annual report, published booklet, various published document, website, text book, circular etc.This report has several chapters and different aspects regarding the topic have been discussed in each chapter. I examine some important ratio of credit risk and analyze their current situation based on profitability, profit margin and market share of ROI. Quantitative analysis reveals that UBL o through rigid credit risk management to manage their credit risk through they still need to improve on some areas such as relying more on debt may affect their liquidity and solvency and eventuality affect credit risk bank must have sophisticated information system and analytical techniques that enable management to measure the credit risk and bank should take into consideration potential future changes in economic conditions when assessing individual credits and their portfolio, and should assess their credit risk exposures under stressful conditions