types of loans & advance with special reference to dbbl-2003

8/18/2019 Types of Loans & Advance With Special Reference to DBBL-2003

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Types of Loans &Types of Loans &AdvancesAdvances

Presented ByPresented ByBaqui Md. Omar FarukBaqui Md. Omar Faruk

Assistant Vice PresidentAssistant Vice PresidentGu s!an Branc!" #!aka.Gu s!an Branc!" #!aka.


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Loans & Advances can $e dertermined in manyLoans & Advances can $e dertermined in many

%ays $ased different factors.%ays $ased different factors.#ependin' on %!et!er e(posure is of direct or#ependin' on %!et!er e(posure is of direct orindirect )indirect )

Funded & *on)fundedFunded & *on)fundedFunded Funded + #irect e(posure a'ainst t!e $orro%er+ #irect e(posure a'ainst t!e $orro%ert!us requirin' $ookin' t!e e(posure as in t!et!us requirin' $ookin' t!e e(posure as in t!e

$a ance s!eet. Banks fund are invo ved.$a ance s!eet. Banks fund are invo ved.*on)funded *on)funded + ,ndirect e(posure a'ainst t!e+ ,ndirect e(posure a'ainst t!e$orro%er t!us requirin' $ookin' t!e e(posure in$orro%er t!us requirin' $ookin' t!e e(posure in

t!e off)$a ance s!eet. Banks fund are nott!e off)$a ance s!eet. Banks fund are notinvo ved.invo ved.


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#ependin' on c!aracteristics of %it!dra%a -#ependin' on c!aracteristics of %it!dra%a -

repayment-maturity-o$ ectives" oans &repayment-maturity-o$ ectives" oans &advances can $e cate'ori/ed in fo o%in' +advances can $e cate'ori/ed in fo o%in' +

LoansLoans++0!en an advance is made in a ump sum0!en an advance is made in a ump sumrepaya$ e eit!er in fi(ed mont! y-quarter yrepaya$ e eit!er in fi(ed mont! y-quarter yinsta ments or in ump sum and no su$sequentinsta ments or in ump sum and no su$sequent

de$it is usua y a o%ed e(cept $y %ay ofde$it is usua y a o%ed e(cept $y %ay ofinterest" incidenta c!ar'es" etc" it is ca ed ainterest" incidenta c!ar'es" etc" it is ca ed aoan. Loans are norma y a o%ed to t!oseoan. Loans are norma y a o%ed to t!ose

parties %!o !ave eit!er fi(ed source ofparties %!o !ave eit!er fi(ed source of

income or %!o desire to pay it in ump sum.income or %!o desire to pay it in ump sum.


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OverdraftOverdraft ++

T!e overdraft is a kind of advance a %ays aT!e overdraft is a kind of advance a %ays aaccount operated $y c!eques. T!e customer isaccount operated $y c!eques. T!e customer issanctioned a certain imit upon %!ic! !e cansanctioned a certain imit upon %!ic! !e canoverdra% !is account %it!in a stipu atedoverdra% !is account %it!in a stipu atedperiod. 1ere %it!dra%a s or deposits can $eperiod. 1ere %it!dra%a s or deposits can $emade any num$er of times at t!e conveniencemade any num$er of times at t!e convenienceof t!e $orro%er" provided t!e tota amountof t!e $orro%er" provided t!e tota amountoverdra%n does not" at any time" e(ceed t!eoverdra%n does not" at any time" e(ceed t!ea'reed imit. ,nterest is ca cu ated anda'reed imit. ,nterest is ca cu ated andc!ar'ed on y on t!e actua de$it $a ance onc!ar'ed on y on t!e actua de$it $a ance ondai y product $asis. T!us t!e $orro%er in t!isdai y product $asis. T!us t!e $orro%er in t!iscase can save interest $y reducin' t!e de$itcase can save interest $y reducin' t!e de$it$a ance.$a ance.


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2as! 2redit2as! 2redit ++

2as! 2redit is t!e favorite mode of $orro%in'2as! 2redit is t!e favorite mode of $orro%in'$y traders" industria ists" a'ricu turists" etc.$y traders" industria ists" a'ricu turists" etc.for meetin' t!eir %orkin' capitafor meetin' t!eir %orkin' capitarequirements. T!ere are t%o types of cas!requirements. T!ere are t%o types of cas!credit+ 22 3P ed'e4 and 22 31ypo4.credit+ 22 3P ed'e4 and 22 31ypo4.

0!en faci ity is 'iven a'ainst p ed'e of0!en faci ity is 'iven a'ainst p ed'e of'oods-produce and merc!andise is ca ed 22'oods-produce and merc!andise is ca ed 223P ed'e4. ,n 22 3P ed'e4" possession remains3P ed'e4. ,n 22 3P ed'e4" possession remains%it! t!e $ank $ut o%ners!ip ies %it! t!e%it! t!e $ank $ut o%ners!ip ies %it! t!e$orro%er.$orro%er.


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0!ereas if it is 'iven a'ainst !ypot!ecation0!ereas if it is 'iven a'ainst !ypot!ecation

of 'oods t!en it is ca ed 22 31ypo4.of 'oods t!en it is ca ed 22 31ypo4.

,n a manufacturin' company" %!ose stocks of,n a manufacturin' company" %!ose stocks of

ra%)materia s and manufactured 'oodsra%)materia s and manufactured 'oodsconstant y f uctuate" it is difficu t for t!econstant y f uctuate" it is difficu t for t!e$ank to contro suc! c!an'e5 so 22 3!ypo4 is$ank to contro suc! c!an'e5 so 22 3!ypo4 isa o%ed to t!em. ,n t!is case" $ot! o%ners!ipa o%ed to t!em. ,n t!is case" $ot! o%ners!ip

and possession of t!e 'oods remain %it! t!eand possession of t!e 'oods remain %it! t!e$orro%er a t!ou'! $y virtue of t!e$orro%er a t!ou'! $y virtue of t!e!ypot!ecation a'reements" t!e $ank can take!ypot!ecation a'reements" t!e $ank can takepossession of t!e 'oods if defau ted.possession of t!e 'oods if defau ted.


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Bi s Purc!ased and #iscountedBi s Purc!ased and #iscounted ++ Purc!ase and discountin' of $i s of e(c!an'ePurc!ase and discountin' of $i s of e(c!an'eis anot!er %ay of emp oyin' t!e $ank funds.is anot!er %ay of emp oyin' t!e $ank funds.6uc! $i s of e(c!an'e arise out of commercia6uc! $i s of e(c!an'e arise out of commercia

transactions $ot! in in and trade and forei'ntransactions $ot! in in and trade and forei'ntrade.trade.T!ey are cate'ori/ed into 74 demand $i s andT!ey are cate'ori/ed into 74 demand $i s andusance $i s" 84 c ean $i s and documentaryusance $i s" 84 c ean $i s and documentary

$i s. 0!ere a $i is repaya$ e at si'!t or on$i s. 0!ere a $i is repaya$ e at si'!t or ondemand or on presentation" it is ca ed ademand or on presentation" it is ca ed ademand $i . ,f a $i matures for paymentdemand $i . ,f a $i matures for paymentafter a certain period of time" it is ca ed aafter a certain period of time" it is ca ed a

usuance $i . #emand-si'!t $i s are purc!asedusuance $i . #emand-si'!t $i s are purc!asedand usance $i s are discounted.and usance $i s are discounted.


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2 ean $i s are t!ose $i s %!ic! are not2 ean $i s are t!ose $i s %!ic! are not

supported $y documents of tit e to 'oods.supported $y documents of tit e to 'oods.2!eques" #ividend 0arrants and Pension $i s2!eques" #ividend 0arrants and Pension $i sare considered as c ean $i s. #ocumentaryare considered as c ean $i s. #ocumentary$i s are t!ose $i s %!ic! are supported $y$i s are t!ose $i s %!ic! are supported $ydocuments of tit e to 'oods" ike 9ai %aydocuments of tit e to 'oods" ike 9ai %ay9eceipts" Truck receipts" #e ivery c!a an and9eceipts" Truck receipts" #e ivery c!a an andBi s of Ladin' to'et!er %it! invoice" insuranceBi s of Ladin' to'et!er %it! invoice" insurancepo icy etc.po icy etc.


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Bank 'ives advance to importers & e(porters in t!eBank 'ives advance to importers & e(porters in t!einternationa trade as under+internationa trade as under+ ,mport Finance,m port Finance ++

Payment a'ainst #ocuments 3PA#4Loan a'ainst imported merc!andise 3L,M4Loan a'ainst Trust 9eceipt 3LT94

:(port Finance:( port Finance ++

:(port 2as! 2redit 3:224-Packin' 2redit

Forei'n #ocumentary Bi s Purc!ased 3F#BP4:(port #eve opment Fund 3:#F4 0e may cate'ori/e e(port finance into t%o cate'ories0e may cate'ori/e e(port finance into t%o cate'ories

Pre)s!ipment credit & Post)s!ipment creditPost)s!ipment credit


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#ependin' on providin' credit to individua s" oans#ependin' on providin' credit to individua s" oans

can $e of many types under 9etai Loans ikecan $e of many types under 9etai Loans ikePersona -Any purpose oans" 2ar oans" andPersona -Any purpose oans" 2ar oans" and:ducation oan" and ot!er consumer oans.:ducation oan" and ot!er consumer oans.Mort'a'e oans are a so 'iven to individua 3s4.Mort'a'e oans are a so 'iven to individua 3s4.

O$ ective of suc! oans is to improve t!eO$ ective of suc! oans is to improve t!estandard of ivin' of imited income 'roup.standard of ivin' of imited income 'roup.

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