This Loan Recoveries and Delinquency Management course is an intensive training aimed at equipping Recoveries Officers, Credit Officers and Credit Risk Analysts to plan effective strategies on the second way out to recover the delinquent and bad loans within the confines of guidelines imposed by regulations and best practices.
Financial institutions besides accepting the industry risk also consider the first way out to get paid. If the cash flow of business cannot service the loans, then the financial institution will look out for a second way out, by enforcing on the given security.
Collateral, sometimes considered least important, may fully satisfy debts of borrowers. Thus, bank officers must know how to expeditiously enforce its rights on second way out, after the aborted first way out, to maximise recovery of NPLs within a short span of time.
Key Learning objective
The key learning objectives of this training is to enhance the loan recoveries within financial institutions.
After completion of this course, participants should be able to:
- Understand the causes, consequences and measurement of arrears
- Understand and implement recovery processes
- Effectively collect on overdue loans
This training will make use of several simulations, role plays and case studies to practically illustrate how to effectively recover NPLs.
The training will allow participants to develop strategies, processes and an implementation plan for the recovery of written off loans and current delinquent debts which may worsen if immediate steps are not taking to recover.
A: Introduction to recovery of loans
- Definitions and measurement of arrears and recovery
- The role of the recovery process in the bank
- The specific case of recovering agricultural loans
- Causes of arrears
- Consequences of arrears
- Prevention is better than cure
B: Performance targets and measurement in recovery
- The practice of recovery
- Key principles of a coherent recovery process
- Overview of typical Bank recovery procedures
- Using effectively the 3Rs – Rescheduling, Refinancing and Restructuring
- The recovery process 1-30 days late
- The recovery process > 30 days late
- The role of collateral in the recovery process
- Follow up of written off loans (‘recovery of written off loans’)
C: Psychology of loan recovery
- Three ego states - Parent, Adult, Child
- Applying the insights from transactional analysis