General rules in granting credit The Five CS | Factors related to the bank | factors related to the quality of the credit facility provided |
-Customer’s personality -Financial and administrative capacity of the customer -The customer’s self-financing ability i.e. capital -Guarantees provided by the customer -Economic conditions are factors related to the bank | -Objectives of the bank -The financial and human resources of the bank -The concentration of the bank in the market -Liquidity considerations -Bank strategy (Conventional, offensive, credit crunch) -Credit and banking policy of the bank (under the general credit policy) | -Purpose of credit -Credit period -Loan amount -Loan repayment method -Source of payment -The appropriateness of this credit to the credit policy -The balance between the return and the cost of credit -Risks -Factors related to the bank |