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Semester Spring 2017

Credit and Risk Management (FIN625)

Graded Discussion Board


Due Date May 23, 2017                                                                    Marks 5



Discussion Topic:


Preliminary investigation in credit approval process


Discussion Question:


A customer comes to XYZ bank for a loan of Rs: 5Million for business enhancement purposes. He provides the following information about his banking relationships and lending facilities availed from other banks to the credit officer.


Bank name

Nature of facility

Limit Amt.


Secondary security held




ABC Bank Ltd

Cash Finance

Rs. 5.000 Million

Hypothecation of stock


 Jail Road, Lahore





DEF Bank Ltd


Rs. 5.000 Million

Hypothecation of stock

Property at Peco Road Lahore


In preliminary investigation, the credit officer comes with the following information:

  • CIB report shows that he is defaulter, but customer does not accept it.
  • Customer business is not in such a situation to repay the loan, but the customer says he will pay back the loan with the loan taken from some other bank.
  • Customer wants to get the loan for the marriage of his son rather than business enhancement.
  • Customer belongs to a minority group in the country.


As per the provided information above, answer the following questions and support your answers with logical reasoning.

  1. How the information provided by the customer about his lending facilities will be confirmed by the credit officer?
  2. How the customer can change / update his CIB status?
  3. Bank’s main concern is the repayment of loan, should the credit officer sanction the loan to customer in above situations? Why or Why not?
  4. Will the customer’s religious affiliation affect the credit decision? Why or why not?





  • Keep your discussion relevant as irrelevant answers will not be graded.
  • Answers copied from blogs, other students, websites etc. will be straight away marked as zero.
  • No grace day or extra time will be given for posting comments on GDB.


                                                                                             Best of Luck!!

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