TITLE OF THE PROJECT

CREDIT

MANAGEMENT UNDER WORKING CAPITAL OF

CANARA BANK

INTRODUCTION AND OBJECTIVE OF THE STUDY

Any field of investigation or reporting requires a preliminary plan. The aim and scope of the study
must be understood at the outset. One has to present a clear idea of the reporting procedure used in the
study since the value of any systematic research lies in its methodology. Any enquirer would prove
unsuccessful if it is not done along certain methodical lines. Thus the validity of study to a great extent lies
in its methodology.
Research is a process by which the researcher tries to analyze the data available to him either to
find a solution to an existing problem or to use an opportunity available in the environment. There are
various types of research methods. Research design is like a blueprint for the researcher as to how he or
she should proceed. It specifies the statement of the problem, data sources, and objective of the study,
data analysis and interpretation. A good research design ensures effective research and results in fruitful
use of resources.
The main objectives of the study are as follows;

1. The role of credit management in finding up the financial status of the banks.
2. Analyzing, classification, recognition and provisions of income and assets brought into action.
3. To know about the different kinds of credit facilities.
4. To understand the concept of credit policies in banks.
5. To understand the concept of credit management under working capital.
6. Analyzing the reasons for credit management and its profitability in banks.
7. To know about what precautions to be taken at the time of granting advances

PROBLEM STATEMENT( INCLUDING LITERATURE REVIEW)

The total requirement of working capital is met partly by the credit that the suppliers of goods and services
{i.e. trade credit} extend to the firm. The remaining part is to be produced by the firm out of its own internal
sources or short-term borrowings from banks.
Banks are the main institutional sources of working capital finance in India. After trade credit, bank
credit is the most important source of financing working capital requirements of forms in India. The

fact that bank finance is the most commonly negotiated source of working capital finance motivated
my interest to undertake this study.
Credit management is the management of the credit portfolio of banks and financial institutions.
Credit management is no longer a rule-of-thumb game .In a highly competitive and deregulated
environment, banks and financial institutions have to evolve better systems and procedures to manage the
credit needs of highly demanding customers, particularly in the corporate and retail sectors. The
developments of the past decade have totally changed the perspective of management of credit .Credit
management of canara bank: Capital adequacy norms
Risk management including asset-liability management
Exposure norms
Risk pricing policy and credit risk rating
Asset classification, income recognition and provisioning norms
Appraisal, credit-decision making and loan review mechanism
Hence a study is done to evaluate the credit management at canara bank. They are various parameters,
techniques and strategies to evaluate the credit management of any bank.
The principles of lending, which include the aforesaid parameters, form part of bank-specific loan policies.
With progressive computerization of front-office and back-office and net working of bank branches,
software programmes are being introduced and developed for risk management are based on various
models suggested by the canara bank.
To study the pattern and procedures followed in canara bank regarding credit management, and to indicate
the performance of credit management a research was taken up and various techniques are used to solve
various problem areas in the area of credit management.

METHODOLOGY AND REFERENCES

The project has been successfully completed with the use of various sources of information which
has been bifurcated as primary source and secondary source.
The primary source is drawn up from the bank where the study has been done by preparing
questionnaires, face to face, discussion with the concerned people of the bank, by the ideas received from
them.
The secondary sources were collected from various periodicals i.e. journals, manuals, circulars, reports,
brochure and annual reports provided
by the bank. Apart from them the books, several websites of the bank and financial institutions was
made use for the study.

Books Referred:

S.Murali and K.R.Subbakrishna, Bank credit management, Himalaya Publishing House

Pvt.ltd., First Edition: 2008.
Prassanna Chandra, Financial Management, Tata McGraw Hills.
I.M Pandey, Financial Management, Vikas Publishing House Pvt Ltd., Ninth Edition: 2005.
Arun chatterjee Credit Management In Particle Approach, Skylark Publications., First
Edition:2004.

Other sources:

Bank Broachers
Annual reports
Bank websites
Journals