Course objective:
Most problem loans involve some breach of discipline in principle, policy, procedure or judgment. This module outlines a framework for establishing credit discipline in a MFI. The module then reviews the components of an effective credit administration process: a written loan policy, an asset quality rating system, a formal loan pricing system, an effective committee process, a strong credit administration and loan review function, well-trained lending officers, and a positive lending environment. When combined, these components result in a quality loan portfolio. The integration of all the aspects of credit administration is termed credit discipline. This program provides an understanding of the critical components of strong and positive credit culture.
Course audience:
This course is designed for credit managers, loan officers, credit analysts and loan administration and good governance personnel, regardless of level or experience, to provide an enhanced perspective or refreshed understanding of critical components of strong and positive credit culture.
Course Contents:
This program will address the following key issues:
- Why discipline is so needed and so important to successful lending leadership and practice;
- Objective of loan discipline
- Framework for establishing credit discipline
- Advantages of compliance with credit discipline
- advantages of teaching borrowers credit discipline
- How to institute loan discipline effectively
- Characteristics of strong and positive credit culture;
- Role of sound, effective policy;
- Importance of portfolio vision in achieving a discipline environment;
- Importance of measurement and objective performance evaluation – feeling right may not be enough confirmation of best practices; and
- MFI’s response and tolerance towards breach of disciplines
- Discipline as a tool for loan growth.
