Podcast
Questions and Answers
Who has the authority to consider deviation, modification, concession, and waiver for proposals falling under COCC-CGM powers?
Who has the authority to consider deviation, modification, concession, and waiver for proposals falling under COCC-CGM powers?
What is the minimum exposure threshold for proposals to require processing by qualified officers?
What is the minimum exposure threshold for proposals to require processing by qualified officers?
What must be included when approving deviations, modifications, concessions, and waivers?
What must be included when approving deviations, modifications, concessions, and waivers?
Which department is responsible for developing qualified human resources for processing credit proposals?
Which department is responsible for developing qualified human resources for processing credit proposals?
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What is required from officers processing sector or product specific credit proposals?
What is required from officers processing sector or product specific credit proposals?
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What is the primary role of the Credit Policy Committee (CPC)?
What is the primary role of the Credit Policy Committee (CPC)?
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Who heads the Credit Policy Committee (CPC)?
Who heads the Credit Policy Committee (CPC)?
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Which committee is responsible for approving new products or modifications to existing products?
Which committee is responsible for approving new products or modifications to existing products?
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What is one of the key functions of the Risk Management Department?
What is one of the key functions of the Risk Management Department?
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How can agenda notes be approved in cases requiring urgent approval?
How can agenda notes be approved in cases requiring urgent approval?
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What is the main focus of the Risk Management Department’s evaluations?
What is the main focus of the Risk Management Department’s evaluations?
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Which of the following committees also has overlapping areas of exercise with the CPC?
Which of the following committees also has overlapping areas of exercise with the CPC?
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What is primarily developed by the Risk Management Department for credit risk management?
What is primarily developed by the Risk Management Department for credit risk management?
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Study Notes
Credit Policy Committee (CPC)
- CPC is a senior management committee led by the Managing Director & CEO
- CPC is responsible for implementing the bank's credit risk management policy & guidelines
- Overlapping functions with the Risk Management Committee (RMC) may exist; both exercise oversight at their level
- A Sub-Committee of CPC, headed by Executive Director(s), is a Board-approved committee
- Detailed guidelines for CPC & its Sub-Committee are in Policy Annex No. 1
Product & Process Approval Committee (PPAC)
- PPAC is a Board-approved committee for new product vetting & modifications to existing products
- PPAC also approves new processes & modifications to existing ones
Risk Management Department
- Measures, monitors, and controls credit risk across the bank
- Ensures compliance with board-set credit risk parameters & prudential limits
- Develops and implements credit risk measurement tools, systems, & procedures
- Creates a credit risk Management Information System (MIS)
- Monitors credit portfolio quality, identifies problem exposures, and formulates corrective actions
- Evaluates risk-return for different loan segments, providing insights for policy & marketing
Approval Processes
- Committee agenda notes are considered & approved
- Urgent approvals may be obtained through member circulation
- Circulation approval requires quorum completeness, with noted agenda placement before the committee
- COCC-CGM has power to deviate, modify, concede, or waive guidelines (unless specified elsewhere)
- COCC-ED and higher authorities may also deviate/modify/concede/waive as per delegated powers
- All deviation/modification/concession/waiver approvals must comply with regulations and be justified in writing.
- Scheme-specific deviations need higher approval depending on the level
Credit Proposal Processing
- Officers with specific qualifications & experience will process sector/product-specific credit proposals
- Proposals exceeding Rs. 50 crore (or equivalent) need officers with specific qualifications or 3+ years' credit function experience with sector-specific expertise/certification
- HR department is responsible for developing and maintaining qualified human resources
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Description
This quiz covers the essential roles and responsibilities of the Credit Policy Committee (CPC), Product & Process Approval Committee (PPAC), and the Risk Management Department within a bank. Participants will learn about credit risk management policies, product vetting, and compliance measures. Test your knowledge of these critical banking functions and their interrelations.
