WorksheetsObjectives and Goals of Credit Monitoring
Total questions: 17
Worksheet time: 9mins
Which action best aligns with ensuring end use during credit monitoring?
Verify funds match approved purposes regularly
Delay disbursement until market rates decline
Transfer repayments into a suspense ledger monthly
Outsource borrower contact to third‑party agents
A borrower’s actual cash flows fall short of projections. What is the most appropriate next step for the bank?
Wait for the next quarter without intervention
Close the account and recall the entire loan
Blacklist the borrower across all banking networks
Identify causes and consider rescheduling or restructuring
A term loan’s principal or interest is overdue for 25 days. Which SMA sub-category applies?
SMA-2 for more than ninety days
SMA-1 for more than sixty days
No SMA category for short delays
SMA-0 for up to thirty days
A cash credit account’s outstanding balance stays continuously above the sanctioned limit or drawing power, whichever is lower, for 65 days. How should it be classified?
Standard asset with no concern
SMA-2 for more than sixty days
SMA-1 for more than thirty days
SMA-0 for brief excess period
In the loan account life cycle diagram, which sequence correctly orders stages as stress increases and resolution becomes more complex?
Sanction → EWS → SMA → NPA
NPA → SMA → EWS → Sanction
EWS → Sanction → NPA → SMA
SMA → NPA → Sanction → EWS
Which activity primarily verifies borrower identity and assesses integrity before releasing loan funds?
Executing security documents with guarantor signatures
KYC and due diligence including enhanced checks
Registering charge or mortgage with CERSAI
Obtaining NOC from existing lenders for takeover
A lender plans to take over a borrower’s account from another bank. What is the correct pre-disbursement step to avoid double financing risk?
Create charge or mortgage on both prime and collateral
Conduct a pre-disbursement unit inspection on site
Obtain a No Objection Certificate from current financiers
Complete the Credit Process Audit and file report
Which action belongs on the working capital disbursement Do’s list?
Verify major debtors and creditors details
Arrange financing for possible cost overrun
Collect certificates from independent agencies
Obtain proforma invoices for evaluation
A lender plans to release a term loan tranche. What is the most appropriate procedure?
Skip evaluation of proforma invoices
Transfer cash to unrelated sister concerns
Deposit funds into borrower’s savings account
Pay suppliers directly with promoter’s margin
Which activity directly checks whether receivables are turning into cash within expected timeframes?
Monitoring the realization of debtors and age of debtors
Keeping watch on account operations and transfers
Stock movement tracking and rejection analysis
Scrutiny of audit reports and financial statements
A borrower frequently requests changes to terms and conditions after disbursement. What is the most appropriate immediate monitoring response shown in the slide?
Verify invoices and store records regularly
Submit Monthly Credit Monitoring Reports promptly
Conduct periodic inspection of unit and securities
Watch on frequent requests for excess or modification in T & C
Which external information source would best reveal regulatory pressure on a borrower’s operations?
References from other bankers on connected accounts
Raids or enquiries by agencies such as GST, Income Tax, DRI, CBI
Information from borrower’s employees like accounts officers
Market reports from newspapers and periodicals
Which tool primarily provides a one-stop solution for uploading and accessing monitoring-related reports at prescribed frequencies?
MCMR upload site for standard assets
Stock Audit Report portal with quarterly tabs
Ledger Scrutiny dashboard for account operations
CMCC Portal with various monitoring tabs
A legal audit must first occur within two years of disbursement and then every five years for exposures above Rs.100 Cr. Which report mandates this schedule?
Advocate's vetting Report requirements for stamping
Concurrent Audit Report rectification timeline
Legal Audit Compliance policy for bank interest
Documentation & DBC rules on recovery rights
You are asked to evaluate working capital performance monthly using gross sales, net sales, and receivables, then compare projections. Which monitoring tool fits this task?
Stock & Book-debt Statement DP calculation
Factory Visit Report discussions with workers
Monthly Select Operational Data analysis process
Quarterly Performance Report for manufacturing units
Which statement best describes a Red Flagged Account (RFA) in banking?
An account closed because of routine operational discrepancies
An account marked due to one or more Early Warning Signals
An account upgraded after exceeding credit utilization limits
An account paused when seasonal cash flows decline
Match each EWS alert category with the primary action emphasis.
Highly Critical — thorough examination for possible fraud
Critical — immediate corrective actions by field staff
Highly Critical — advisory notes with no urgent response
Informatory — continuous monitoring and preventive steps
