term loan review format
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CREDIT ADMINISTRATION DEPARTMENT
FORMAT FOR REVIEW OF TERM LOAN
SANCTIONING AUTHORITY:
MCB/CMD /ED/Others
FOR APPROVAL AGENDA ITEM No.
REF. NO. DATE
The proposal falls under the powersof
Head Office
Date of receipt of Proposal 29.10.2011Date of receipt of RO
recommendationDate of receipt of FGMrecommendation
Date of receipt of last reply
ED ED CMD
Date : 04.11.2011
Name of the Account :
Branch :Region :Line of activity :
Date of sanction & Authority :
Date of last review & authority
Validity extended, if any :
Asset Classification :Banking/ Financing arrangement :
Lead Bank, if consortium :
Our Banks share in consortium :
Credit Rating
Aggregate Group Exposure(from our Bank)
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1. SUMMARY OF THE PROPOSAL:
Memorandum for
a. Review of Term Loans:(Rs. in Crores)
b. Concessions/ Value of the Account
Facility &Limit
ExistingRate
ProposedRate
ApplicableRate
Amount of Income Earned
Last Year Current yearupto30.09.2011
Rate of interest
(a) Interest Income
Review Fee (sanctionamendment charges)
(b) Non InterestIncome
Total Income (a + b)
c. Confirmation / Ratification of action, if any:
Confirmation/ Ratification sought Comments with Justification
2. BORROWERS PROFILE:-
Group Name RELIGARE
Address: Corporate Office
Regd. Office
Constitution & Date of constitution / Commencementof business
Dealing with the bank since
Management/Main Person behind the Group 1.
Net Worth of the Borrower as on 31.03.2011
Nature of facilities ExistingLimit
Balance O/s ason 30.09.11
Overdue,If any
Proposed Limit
Term Loan-I
Term Loan-II
Total
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Whether Priority sector / Export/ Others
Type & Size of industry
Industry/Trade to which the borrower belongs
Latest Market value of the Share (if listed) of the
borrower as on
a. NAMES OF PARTNERS/DIRECTORS:-
Name Status Net worth As on
1. Whether the Borrower / directors / partners are inDefaulters/ Willful Defaulters List of RBI/CIBIL/ ECGCSAL/ Caution List (If yes, give details)
2. If any of the directors/ partners connected in the past withany NPA/ OTS/ Compromise/ unscrupulous defaulters
3. If any of them, related to Directors/Senior Officers of ourbank
4. Management Change since last sanction, if any5. Succession Plan
b. Share Holding Pattern as on:
Name of the Promoters/
Major Share holders
No. of shares Rs. In Crores. % Holding
Promoters Holding
FIs/ Mutual Funds/UTI/Banks/FIIs
NRIs/OCBsPublic
Others
Total
c.Whether Shares pledged to any Bank/FI/others NoIf yes, Percentage of shares pledged
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Institution
Purpose
3. MANAGEMENT (MAIN PROMOTERS AND THEIR EXPERIENCE):-
Present composition of the Management/ Board of Directors with their Brief profile is given below:
S.No. Name of the Director Designation Brief Details
1.
2.
3.
4.
4.1 Key Management Personnel
Name Designation Educational
Qualification
Date of
joining
Previous
employer
4. BRIEF HISTORY OF THE PROJECT INCLUDING PURPOSE FOR WHICH THE TERM LOAN(S)BEING REVIEWED WAS/ WERE SANCTIONED:-
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5. CREDIT FACILITIES SANCTIONED TO THE BORROWER BY OTHER BANKS/ FINANCIALINSTITUTIONS (including Lease, ICDs, Corporate Loans, Debentures etc.):-
6. DETAILS OF CREDIT FACILITIES SANCTIONED TO GROUP CONCERNS BY OUR BANK:(Rs. in crore)
Sr.No.
Name of Concern Term Loan(o/s)
Fundbased
Non-fundbased
Total
7. COMPLIANCE WITH EXPOSURE NORMS:
(Rs. in Crore)IndividualBorrower
Group
Permissible Exposure Ceiling as on 31s March_____
Internal Exposure Limit for the Borrower
(i) Fund Based Working Capital Limits (100%)
(ii) Non-Fund Based (100%)
(iii) Term Loans
(iv) Investment in Shares/Bonds of the borrower/Group(100%)
(v) Credit Equivalent of Forward Contract Limit (@ 5%)
TOTAL EXPOSURE
(- Permissible Exposure Limit shall be 15% of the Banks Capital Funds for Individual Borrower and 40% for Group. - Internal Exposure Limit as per Loan Policy based on Constitution of the Borrower to be mentioned.)
8. OPERATING PERFORMANCE AND FINANCIAL POSITION OF THE BORROWER:-
(Rs. in Crores)
For the year ended / ending
Gross Income
- Income from financial activities- Other Income
Net Sales (net of excise duty)
% growth
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For the year ended / ending
Other Income
EBIDTA / PBIDTA
Profit Before Tax
Profit After Tax
Authorized Capital
Paid up Capital
Reserves & Surplus
Intangible Assets
Share Application Money
a) Tangible Net Worth (TNW)b) Deferred Tax Liability/(Asset)c) Investment in group concernsd) Adjusted TNW (a + b - c)
Unsecured Loans
Term Loans from Banks / FIs
Other Term Liabilities
Total Term Liabilities
Capital Employed
Net Block
Total Non Current Assets
Total Current Assets
Total Current Liabilities
Net Working Capital
Ratios:
Current Ratio
Debt Equity Ratio
TL / Adj. TNW
Leverage Ratio (TOL/TNW)
TOL/ Adj. TNW
Net profit to sales (%)
12. 1 CRITICAL EXAMINATION & ANALYSIS OF BALANCE SHEET AND PROFIT AND LOSS ACCOUNT
Tangible Net worth
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Term liabilities
Unsecured Loans
Net Block
Intangibles
Non Current Assets/Investments
Current Assets
Current Liabilities
Current Liabilities mainly include Short Term Bank Borrowings, Trade Creditors, creditors for expenses, etc. and othe
current liabilities and provisions. The total current liabilities came down to Rs. 2639.68 Crore as on 31.09.2011 as
compared to Rs. 3800.74 Crore as on 31.03.2010 due to decline in other current liabilities which mainly include working
capital and short term borrowing from bank.
Net Working Capital
Profitability
Ratio Analysis
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a DSCR
Description Estimated at the time ofsanction for the year
ended
Actual as per auditedfigures for the year ended
PAT
Depreciation
Interest on TL
Total Cash Inflows - A
Interest on TL
Installment of TL
Total Cash Outflow B
DSCR A/B
Interest coverage ratio (4/5)
b DSCR
c. Whether the Balance Sheet is qualified: No
AuditorsQualification
Effect on NetWorth
CompanysClarification
Remarks/PossibleRemedies
d. Details of Liabilities not accounted for/Contingent liabilities:(Amt. in Crores)
Particulars Amount RemarksDisputed taxes
Corporate guarantee
Bank guarantee
Pending court cases
Claim against the company noacknowledged as debt
Assignment of receivables
Inland bills purchased/discounted by bank
e. Information on litigation, if any, against the borrower / partners/ directors:
Not available.
f. Overall likely impact of the above on the financial position of the borrowing unit:
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9. REVIEW OF EXISTING TERM LOAN(S)0.
a. Brief Details of Term Loan
Amount Sanctioned
Present O/s (Mention if TL is underdisbursement)
Date of original sanction
Date of last review
Date of recovery of upfront/Processing fee
Whether the account has been restructured ifyes, give date and details of restructuring in brief
Date of first disbursement
Moratorium Period
Existing Repayment Schedule:
(a) No. of installments(b) Due date of First installment
No. of Installments and amount due so far
Present outstanding
Overdue, if any
b. Overall Conduct of Account (Whether the borrower is regular in servicing of interest/installments)
c . Status of COD/DCCO
COD/DCCO Stipulated at the time of original sanction
Date of actual COD/DCCO (in case project has been completed)
Expected COD/DCCO on the basis of factual progress of theproject (in case the project is still under implementation)
(Reasons for delay in project in case there is delay in COD/DCCO be specified)
d. In case of projects under implementation - NA
- Physical and Financial Status of Project (as per latest CA certificate/LIE Report/Unit/SiteVisit Report/Minutes of last consortium meeting)
Particulars Originally envisaged Actually incurred till
Comments on the above:-
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(Main landmarks of implementation schedule to be compared and whether the project isprogressing/completed as per schedule)
e. Reset of Rate of Interest (If Applicable) - NAStatus of Interest Reset (Rate of Interest being charged by other term lenders if any)
10. DETAILS OF SECURITY
Primary -
Collateral - NIL
11. VALUE OF THE ACCOUNT:(In terms of interest / commission, other income, deposits etc. earned)
(a) . Deposits including Escrow / TRA account with details:
Particulars No. of A/cs Amount / Average Balance
Saving
Current (Religare finvest ltd. & ReligareSecurities Ltd.)
Term Deposit
Escrow/ TRATotal
(b).Details of other ancillary business such as Staff Salary accounts, retails loan toemployees, CMS facility, Demat facility to employees, Mutual Fund units, InsuranceProducts etc.
12. AUDIT/INSPECTION IRREGULARITIES IF ANY:-
Irregularity Pointed out or Reported Comments/ Present position of Rectification
13. STATUS/ CONFIRMATION OF COMPLIANCES:
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1. All the terms & conditions of last sanction complied with.
2. Security documents are duly vetted and enforceable
3. Proper charge on securities created
4. Branch Confirmation of Compliance (BCC) cleared
5. Confirm that payment of statutory dues is not in arrears
6. Corporate governance practices are being followed as per Auditors Report7. Consortium meetings (if applicable) are being held regularly
8. Information under Multiple Banking Arrangement (if applicable) beingexchanged as per RBI guidelines
14. DATE OF LAST VISIT TO THE UNIT & OBSERVATIONS:
15. ANY OTHER ISSUE NOT DISCUSSED ELSEWHERE:
NIL
16. CREDIT RATING:
A. Banks Internal Rating:(last two ratings with reasons for decline in rating/poor rating in brief)
Model Based on financials of (Year) Credit RatingSignifies
Reasons for decline/ low rating,if any31.03.10 31.03.11
IMaCS
B. External Rating (as per BASEL II):Agency Date of
ratingCredit ratingvalid up to
Facility Amount CreditRating
Allotted
Riskweightas perexternalrating
Rating signifies
Comments / Rationale for rating and comparison with last External Rating
17. DELEGATED POWERS: The proposal falls under the powers of Head Office.
18. RECOMMENDATIONS:-(Rs. in Crores)
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Nature of facility ExistingLimit
ProposedLimit
Existing Rateof Interest
ProposedRate ofInterest
Other issues for approval , i f any
I)
II)
Terms and Conditions:
Other Conditions
1. The executants of the legal documents on behalf of RFL to be duly empowered and authorized by a resolution
to execute the same and to perform all the obligations in accordance with the terms set out in the
agreements.
2. In Term of HO Circular No. ADV/17/2004-05 dated 29.05.04 necessary documents/declaration from the
borrower pertaining to Credit Information Bureau of India (CIBIL) shall be obtained.
3. The credit facilities shall not be utilized by the company for activities not eligible for bank credit as defined by
RBI.
4. The credit facilities sanctioned to the borrower should be availed within a period of three months of the date
of sanction failing which the sanction shall lapse.
5. Rate of interest of other banks on existing facilities & it should be enured that Rate of interest charged by the
bank is not less than the rate charged by other bank.
6. The company should submit quarterly receivables details (non-capital market) showing value of securitycharged/created along with C.A certificate that all assets are standard net of NPAs.
7. The branch may obtain declaration from the borrower [in Annx-I] about the credit facilities already enjoyed by
them from other banks and may seek the information about conduct of the account from other banks [in Annx
II] as prescribed by RBI (as per circular no. DBOD no. BP. BC 46/08.12.001/2008-09 dt. 19.09.08, DBOD no
BP. BC 94/08.12.08/2008-09 dt. 08.12.08, DBOD no. BP. BC /110/08/08.12.08/2008-09 dt. 10.02.2009).
8. The branch shall exchange information about the conduct of the borrowers accounts with other banks in the
format prescribed by RBI at atleast quarterly intervals (as per circular no. DBOD no. BP. BC 46/08.12.001/2008
09 dt. 19.09.08, DBOD no. BP. BC 94/08.12.08/2008-09 dt. 08.12.08, DBOD no. BP. BC /110/08/08.12.08/2008-
09 dt. 10.02.2009).
9. The branch shall obtain regular certification by a professional, preferably a Company Secretary/Chartered
accountants/Cost Accountants, regarding compliance of various statutory prescriptions that are in vogue, asper specimen given in annexure III prescribed by RBI. (as per circular no. DBOD no. BP. BC 46/08.12.001/2008
09 dt. 19.09.08, DBOD no. BP. BC 94/08.12.08/2008-09 dt. 08.12.08, DBOD no. BP. BC /110/08/08.12.08/2008-
09 dt. 10.02.2009).
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Loan Manager Chief Manager
ANNEXURE - A
VARIOUS UNDERTAKINGS TO BE OBTAINED FROM THE BORROWER ON LETTER PAD
The borrower shall undertake:
1. That the names of Borrower, or its Directors/Partners or Guarantors do not figure in any list of defaulters circulated
by RBI or any Bank and Financial Institution nor the names of partners/directors appear in caution list issued by
RBI/ECGC/DGFT etc.
2. To declare dividend only after obtaining approval from the bank (in case of default in payment o
interest/installments of Term Loan).
3. Not to pay any consideration, in whatever form, to the guarantors/guaranteeing directors, either directly o
indirectly (except without prior approval of the Bank) for the guaranteeing of credit limits sanctioned by the bank
Similar undertaking shall also be obtained from the guarantors.4. Not to obtain any financial assistance from any other source without express approval of the bank/other consortium
member banks in writing.
5. Not to effect any change in promoter directors or in the core management team nor any merger/ acquisition/
amalgamation shall be done without express permission of the Bank in writing. A confirmation to this effect shall be
obtained from the borrower.
6. Not to extend finance to associate concerns during the currency of the Banks advance without the banks prio
written consent.
7. Not to effect any change in the companys capital structure.
8. Not to implement any scheme of expansion/modernization/diversification/ renovation or acquire/sell any fixed
assets during any accounting year, except under such scheme, which have already approved by the bank.
9. Not to Invest in shares/debentures or lend or advance funds to or place deposits with any other concern excep
normal trade credit or security deposits in the normal course of business or advances to employees.
10.Not to undertake guarantee obligations on behalf of any other company, firm or person.
11.Not to effect/permit withdrawals of deposits or withdrawals by family members, friends or directors during the
currency of the bank advance without the prior approval of the bank.
12.Not to create any further charge, lien or encumbrance over the assets and properties of the firm charged/to be
charged to the bank in favour of any other bank, financial institution, Company, firm or person.
13.To keep the Bank informed of the happening of any event likely to have a substantial effect on their profits or
business.
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14.To maintain adequate books and records which should correctly reflect their financial position and scope o
operations and should submit to the Bank at regular intervals such statements as may be prescribed by the Bank in
terms of RBI instructions issued from time to time or otherwise. The borrower shall give an undertaking that the
Bank reserves the right to periodically inspect their records and books of accounts to ensure the correctness o
information furnished by them.
15.To submit Audited Financial Statements etc. to the Bank within the stipulated period of time. The company will be
liable to pay penal rate of interest in case of any delay in submission of the data in question.
16.That none of their associate/group concerns are classified as willful defaulters by other Banks/Financial Institution.
17. I/ we undertake that I/ we would not induct any person, who is a director on the Board of a Company which has
been identified as willful defaulter and further undertake that in case, such a person is found to be on Board of
Borrower Company, I /we would take expeditious and effective steps for removal of any such person from the Board
of the Company within 30 days of such fact coming to its notice.
18. I/ we undertake to issue appropriate undertaking /affidavits/ certificates as the Bank may require from time to time
certifying that the funds comprising of entire amount of loan/ facility/sum due/ amount outstanding in the account
have been used exclusively for the purpose for which they were obtained and the same have not been diverted /
siphoned and no misrepresentation has been caused of any kind or accounts falsified/any fraudulent transaction
have been carried out etc.
19. I /we undertake that upon identification of aforesaid account as a willful defaulter on account of any of the reasonsstated above including any similar reason as stated above, that I / we would be debarred from availing bank finance
for floating new ventures for a period of 5 years from the date the name of willful defaulter is disseminated in the
list of willful defaulter by RBI. I/ we agree that in case of any false /wrong information, the Bank may consider any
legal proceedings, civil /criminal as may be necessary.
20.To confine companys entire banking business relating to activity including deposit, bill business, foreign exchange
business to the BANK/member banks of the consortium and in case of Multiple Banking arrangements, pro-rata
share of the banking business shall be routed through the Bank.
21.An undertaking shall be obtained from the owners of the properties mortgaged to the Bank that there are no arrear
of tax including interest leviable thereon under various provisions of Income Tax Act against them.
22.As the facility is secured by receivables, adequate care should be taken for identification of good quality assets
whose receivables are charged to bank. The company should also undertake for substitution with other assets incase of default.
23.The company would undertake to administer the individual accounts and be responsible for the collection and
recovery, inclusive of repossession and resale, filing of court cases for bounced cheques/ recovery of overdue. N
compensation/ fees would be paid by the Bank for the same.
24.The company would undertake to foreclose accounts, which are prepaid. Any asset, which is NPA in the books of the
company, should be substituted by a performing asset.
25.An undertaking to the effect that the Bank loan raised from us would not be utilized for any activity/purpose, which
is excluded for Bank Finance to NBFC as prescribed by RBI.