WELCOME TO VIRTUAL CLASS ROOM SESSSION JAIIB APRIL 02/2007 WELCOME TO VIRTUAL CLASS ROOM SESSSION WELCOME TO IIBF’S VIRTUAL CLASS ROOM SESSIONS

BANKER-CUSTOMER RELATIONSHIP DEBTOR-CREDITOR CREDITOR-DEBTOR AGENT-PRINCIPAL LESSOR-LESSEE BAILEE-BAILOR

NEGOTIABLE INSTRUMENTS BANKER’S DUTIES & RESPONSIBILITIES PAYING BANKER PAYMENT OF CHEQUES

CHEQUES

NEGOTIABLE INSTRUMENTS BANKER’S DUTIES & RESPONSIBILITIES C0LLECTING BANKER COLLECTION OF CHEQUES

DEPOSIT ACCOUNTS

CERTIFICATE OF DEPOSIT CD IS A MONEY MARKET INSTRUMENT ISSUED AS A DISCOUNT INSTRUMENT MINIMUM AMOUNT IS Rs. One LAKH MINIMUM PERIOD OF CD 15 DAYS MAXIMUM PERIOD OF 1 YEAR DIFFERS FROM FD a) Prepayment not allowed b) Loan is not allowed

CHARGES HYPOTHECATION PLEDGE MORTGAGE ASSIGNMENT LIEN SET OFF

FUND BASED FINANCE

Non-Fund Based Finance

Working Capital Cycle

Non-Resident Indian Accounts Who is a Non Resident Indian? 1)An Indian citizen who resides outside India on account of a) Employment/business/vocation and b) staying outside India for an uncertain period 2)A person of Indian origin but a citizen in any other country except Pakistan/Bangladesh if at any time holding an Indian passport

6 Cs CHARACTER CAPTIAL CAPACITY COLLATERAL CONDITION COMPLIANCE

Clayton’s Case Applicable only to a a) joint a/c and or a partnership a/c b) running c/c and o/d a/cs c) Not to two different a/cs (Right of set off is applicable) Based on the concept of Appropriation

FAQs Distinguish -Cash Credit and Overdraft Both CC and OD forms part of working capital finance CC is granted against moveable goods (inventory/semi finished goods/goods etc) OD is granted against paper security (Fixed deposit receipts/shares/book debts)

FAQs KYC: Know Your Customer Know your customer norms are applicable to all customer accounts. It deals with not only to identify the customer but also to understand the activities of the customer, to ensure that the operations in the customer account/s is/are for genuine purpose

FAQs Fund Based and Non Fund Based limits Banks grants credit facilities to their clients to carry on with their trade activities. These facilities are classified as Fund based/Non fund based depending upon the client’s business requirements. Cash Credit/Overdraft/Loans are examples of fund based limits, where the bank allows the customer to withdraw funds against securities, whereas in respect of non fund based limits like Letters of Credit and Guarantees, the bank extend a comfort level to the clients to enable them to carry on with their business activities

THANKS & ALL THE BEST T.M.C.VARADARAJAN TEL : 022-25638965 (R) 022-66364206 (O) e.mail: t.varadarajan@scotiabank.com tmc_varadarajan@yahoo.co.in