A Report on Internship

at

AU Small Finance Bank

Submitted by

Samihan Sharma

Reg. No. 2220558

Under the guidance of

Prof. Shiney Sam

Assistant Professor
School of Business and Management
In Partial Fulfillment of the Requirements for the Award of the Degree of

BACHELOR OF BUSINESS ADMINISTRATION

SCHOOL OF BUSINESS AND MANAGEMENT

CHRIST (Deemed to be University)

BENGALURU

2024
CERTIFICATE FROM THE COMPANY
 CERTIFICATE

This is to certify that the Internship Report, titled “An Organizational Study Undertaken at “AU
Small Finance Bank,” submitted to CHRIST (Deemed to be University), in partial fulfilment of
the requirements for the award of the Degree of Bachelor of Business Administration, is a record
of original study undertaken by Samihan Sharma, during the period 2024 – 25 in the School of
Business and Management at CHRIST (Deemed to be University), Bengaluru, under my
supervision and guidance. The Internship report has not formed the basis for an award of any
Degree / Diploma / Associateship / Fellowship or other similar title of recognition to any other
University.

Place: Bengaluru Prof. Shiney Sam

Date: Assistant Professor,

School of Business and Management

Dr Anuradha R

Head, School of Business and Management

 DECLARATION

I, Samihan Sharma, hereby declare that the Internship report, titled “An Organizational Study
Undertaken at AU Small Finance Bank,” submitted to CHRIST (Deemed to be University), in
partial fulfilment of the requirements for the award of the Degree of Bachelor of Business
Administration is a record of original and independent study undertaken by me during 2024 - 25
under the supervision and guidance of Dr. Diya Raman Nair, School of Business and
Management and it has not formed the basis for award of any Degree/ Diploma / Associateship /
Fellowship or other similar title of recognition to any other University.

Place: Bengaluru

Date: Samihan Sharma

(2220558)
 ACKNOWLEDGEMENT

I, Samihan Sharma would like to express my profound gratitude to all those who have been
instrumental in the preparation of this Internship Project Report. I wish to place on record, our
deep gratitude to my project guide, Dr. Divya Raman Nair, for guiding me through this project
with valuable and timely advice. I would like to thank Dr. (Fr). Joesph C C, Vice Chancellor,
CHRIST (Deemed to be University), Dr. Jain Mathew, Dean and Dr. Anuradha R, Head-School
of Business and Management for their encouragement. I would like to place on record my
gratitude to AU Small Finance Bank for the opportunity to complete my internship and gain
more knowledge and insights into the industry and its operations.

Last but not the least; I would like to thank my parents and friends for their constant help and
support.

Samihan Sharma
 TABLE OF CONTENTS

Chapter No. Content Page No.

1 Introduction
1.1 Industry Profile
1.2 Company Profile 1-5
1.3 Vision, Mission, Goals and Objectives

2 Organization design 6-9

2.1 Organizational Chart (Hierarchy)
2.2 Products and competitors
2.3 Business Model
3 Functional Areas
3.1 Retail Banking
3.2 Corporate Banking
3.3 Rural and Agri Banking 10-13
3.4 Wealth Management
3.5 Risk Management
3.6 Technology and Operations
3.7 Human Resource
3.8 Marketing and Customer Relationship Management
3.9 Finance and Treasury
4 Analysis and Interpretation 14-16
4.1 Specialization Area

5 SWOC Analysis of the company 17-20

6 Suggestions/Recommendations 21-23
7 Conclusion 24-25
8 References 26-27
9 Annexure 28-35
 List of Tables

Table No. Description Pg. No.

15
4.1 Table showing current ratio of the company

15
4.2 Table showing liquid ratio of the company

15
4.3 Table showing cash position of the company

15
4.4 Table showing proprietary ratio of the company

15
4.5 Table showing solvency ratio of the company

15
4.6 Table showing fixed assets to net worth ratio of the company

15
4.7 Table showing return on equity of the company

15
4.8 Table showing return on total resource of the company

15
4.9 Table showing earnings per share of the company

15
4.10 Table showing interest on loan ratio of the company
 List of Figures

Fig. No. Description Pg. No.

15
4.1 Figure showing current ratio of the company

15
4.2 Figure showing liquid ratio of the company

15
4.3 Figure showing cash position of the company

15
4.4 Figure showing proprietary ratio of the company

15
4.5 Figure showing solvency ratio of the company

15
4.6 Figure showing fixed assets to net worth ratio of the company

15
4.7 Figure showing return on equity of the company

15
4.8 Figure showing return on total resource of the company

15
4.9 Figure showing earnings per share of the company

15
4.10 Figure showing interest on loan ratio of the company
 CHAPTER 1
Introduction to Organization
 1.1 Industry Profile

Overview:

AU Small Finance Bank, established in 1996 as AU Financiers (India) Limited, transitioned into a small
finance bank in April 2017. This transformation was part of India's financial inclusion agenda, aimed at
providing banking services to the unbanked and underserved sections of society. AU Small Finance Bank
operates primarily in the retail banking sector, focusing on serving micro, small, and medium enterprises
(MSMEs), low-income individuals, and rural communities.

Key Features:

1. Financial Inclusion: AU Small Finance Bank plays a crucial role in expanding financial access
in India. It caters to the banking needs of segments traditionally excluded from formal banking
services, offering savings accounts, loans, and other financial products tailored to their needs.
2. Customer-Centric Approach: The bank emphasizes personalized service and customer
satisfaction, leveraging technology to enhance accessibility and convenience. This approach has
helped AU Small Finance Bank build a loyal customer base across its operational areas.
3. Digital Transformation: Like many modern banks, AU Small Finance Bank has embraced
digital transformation to streamline operations and improve service delivery. This includes digital
banking solutions, online account management, and mobile banking apps.
4. MSME Focus: AU Small Finance Bank supports MSMEs by providing them with financial
products such as business loans, working capital finance, and trade finance. This is crucial for the
economic growth of small businesses, which are the backbone of India's economy.
5. Regulatory Compliance: As a small finance bank, AU Small Finance Bank operates under the
regulatory framework of the Reserve Bank of India (RBI). Compliance with these regulations
ensures financial stability and trust among stakeholders.
6. Expansion and Growth: Since its inception as a small finance bank, AU Small Finance Bank has
expanded its footprint across India. It continues to grow both organically and through strategic
initiatives, aiming to reach more underserved communities and contribute to inclusive economic
development.

2
AU Small Finance Bank exemplifies the evolving landscape of Indian banking, particularly in promoting
financial inclusion and supporting economic growth through its focus on MSMEs and underserved
populations. As it continues to innovate and expand its services, AU Small Finance Bank remains a
significant player in the sector, contributing to India's journey towards a more inclusive financial
ecosystem.

3
Profile of the Organization

Mr. Sanjay Agarwal, a C.A. and the first-generation entrepreneur, who was burning with a determination
to serve as a nation builder, shouldered the responsibility to VIA the unencumbered and unbanked bottom
strata of India by financing their entrepreneurship aims. While the idea was maturing, the urge became
real and in 1996 the Au Financiers came into existence, on 19th April. Smaller than Vijay Mallya's more
well known, flagship brewery, Whitbread's Burton business was not headquartered centrally, but rather
locally, in Jaipur, Rajasthan, and was retail-focused, having provided specialist, quick and tailored
financial solutions to the rural and urban population for the last two decades.

Following in the footsteps of SHF, Au Financiers gained the license of SFB (Small Finance Bank) in the
year 2015 and opened the doors to operate as an SFB on 19th April 2017. However, on 1st November
that year, it was upgraded to the Scheduled Bank status while on 26th November the Company was
included in India’s Fortune 500 list. During the transition from NBFC to Bank, it has been more
concentrated on the tailored made solutions, that will be satisfying the needs of businesses and
individuals. As a mandate for the corporate and personal depositors of the Bank is to ensure the greatest
levels of compliance both through and beyond the pandemic and come out as a well-governed and trusted
financial institution based on the guiding principles of progress for all, simplicity, and urgency & action.
In 2021, the Bank became the Largest Small Finance Bank of the country and evolved its positioning
from ‘Chalo Aage Badhein’ to ‘Badlaav Humse Hai’. The new tagline, which is 4 | P a g e also the
Bank’s first integrated brand campaign, resonates well with its spirit of challenging the status quo. Along
with the launch of the brand campaign, digital platform AU 0101, Credit Card and QR Code with Sound
Box were also unveiled. With technology writing the rule book and demand of customer’s shifting
rapidly, the Bank is putting its best foot forward in becoming a Tech-led Bank.

4
444444
The Bank, at this juncture, looking back at the last seven years of banking as a scheduled commercial
bank, realized that it has been a one of growth, impact, and innovation. Through incorporating technology
and providing financial inclusion, as well as creating robust customer relations, the Bank has improved
the livelihoods of the citizens and contributed towards the growth of the economy of the country. The
reach increased thence from 403 Touchpoints in 8 States and 2 Union Territories in 2017 to 2383
Touchpoints covering 21 States and 4 Union Territories as on 31st March 2024. Looking forward, the
Bank continues to pursue its mission being ready to act and learn responsively to satisfy the diversified
customers and changing needs, striving to secure the welfare and better lives of the people.

1.1 Mission, Vision and Goal

MISSION

• Making every customer feel supreme while being served.

• Aspiring that no Indian is deprived of banking.

• Bias for action, dynamism, detail orientation and product-process innovation.

VISION

To be the world's most trusted retail bank and coveted employer, where ordinary

people do exceptional things to impact society at large, ensuring Trust,

Confidence, and Customer Delight.

GOAL

Aim to empower every Indian with financial freedom and digital literacy and the most effective
way to achieve this is by bridging the gap between the cosmopolitan India and the emerging
India.

5
444444
 CHAPTER 2
Organizational Design

444444
2.1 Organizational Chart (Hierarchy)

444444
2.2 Products and Competitors

Competitors

Ujjivan Small Finance Bank

Ujjivan Small Finance Bank Limited is a RBI licensed small finance bank. It is a fully owned subsidiary
of Ujjivan Financial Services Ltd., a well-known microfinance company that was one of the ten banks
granted licenses to provide small loans in the initial round. has a network of more than 160 branches
spread throughout 24 states, offering all banking services with an emphasis on neglected markets. Ujjivan
Small Finance Bank serves in the B2C, Social Impact space in the Financial Services market segments.

ESAF Microfinance bank

Under the name Evangelical Social Action Forum, ESAF Microfinance began operations as an NGO in
1992. It was regulated by the Reserve Bank of India (RBI) as a non-banking financing company and
microfinance institution (NBFC-MFI). In March 2017, it transformed into a small finance bank, and in
January 2018, it opened for business. The modern social bank, ESAF Small Finance Bank (ESAF SFB),
is constantly reinventing banking for all of its stakeholders. Although we are a bank for everyone, with
presence in urban, semi-urban, rural, and unbanked rural areas, our primary goal is broadening the
banking horizon to include new unbanked and underbanked areas.
8

444444
Utkarsh Small Finance Bank

One of the 10 organizations that received the initial batch of small finance bank licenses from the RBI is
Utkarsh Small Finance Bank, which is registered with the RBI. After beginning with credit under the JLG
model, the parent business Utkarsh Micro Finance Pvt. Ltd. expanded its product line to include
microenterprise loans, housing loans, and micro pension products. provides a variety of banking goods
and services in the contemporary banking structure, such as deposit accounts, insurance, mutual funds,
remittances, debit cards, ATMs, point-of-sale payments, and loans for small businesses and homes.
Utkarsh Bank serves in the B2C, Social Impact space in the Financial Services market segments.

Equitas Small Finance Bank

A small finance bank registered with the RBI; Equitas Small Finance Bank opened for business on
September 5, 2016. As one of the top MFIs in the nation, Equitas Holdings is the parent company of this
company. It is Tamil Nadu's first private sector bank to open for business after India gained its freedom.
has operations throughout all of India and offers MSMEs and individuals the complete spectrum of
banking services and products.

2.3 Business Model

A business model refers to the plan which a company designs to earn profit for its survival and
growth in the long term. The company decides on the types of products or services they wish to
sell, the audience they are targeting and related costs for rendering the products/services.

AU Small Finance Bank's business model revolves around inclusivity, innovation, and
sustainability, aimed at making a positive impact on the lives of its customers and contributing to
the economic development of India.

444444
 CHAPTER 3
Functional Areas
AU Small Finance Bank operates across several functional areas, each playing a crucial role in ensuring
the bank's efficiency, profitability, and ability to serve its customers effectively. Here's a detailed
overview of the functional areas of AU Small Finance Bank:

1. Retail Banking:
o Savings Accounts: AU Small Finance Bank offers various types of savings accounts
catering to different customer needs, such as basic savings accounts, salary accounts, and
specialized accounts with additional features.
o Current Accounts: Designed for businesses and enterprises, current accounts facilitate
smooth fund management and transactions.
o Fixed Deposits: Provides customers with an opportunity to invest their savings for a fixed
period at competitive interest rates, offering stability and guaranteed returns.
o Digital Banking: Includes online banking platforms, mobile banking apps, and digital
payment solutions to enhance customer convenience and accessibility.
2. Corporate Banking:
o Business Loans: AU Small Finance Bank offers tailored financing solutions for MSMEs
and corporate clients, including working capital loans, term loans, trade finance, and
financing for business expansion.
o Cash Management Services: Helps businesses optimize their cash flow and liquidity
management through services such as collections, payments, and account reconciliation.
o Trade Finance: Provides services like letter of credit, bank guarantees, and export-import
financing to facilitate international trade transactions.
3. Rural and Agri Banking:
o Farm Equipment Loans: Provides financing for purchasing agricultural equipment and
machinery to enhance productivity in rural areas.
o Kisan Credit Card (KCC): Offers credit facilities to farmers for agricultural and allied
activities, promoting rural development.
o Microfinance: Provides small loans to low-income individuals and micro-enterprises in
rural and semi-urban areas to support their livelihoods and entrepreneurial ventures.

11
4. Wealth Management:
o Investment Products: Offers a range of investment options including mutual funds,
insurance products, and structured products to help customers achieve their financial
goals.
o Financial Planning: Provides personalized financial advisory services to individuals and
businesses, helping them manage and grow their wealth effectively.
5. Risk Management:
o Credit Risk Management: Evaluates the creditworthiness of borrowers and ensures
prudent lending practices to minimize the risk of defaults.
o Operational Risk Management: Identifies and mitigates risks associated with
operational processes, systems, and human errors.
o Compliance and Regulatory Risk: Ensures adherence to regulatory requirements set by
the Reserve Bank of India (RBI) and other regulatory bodies, minimizing legal and
regulatory risks.
6. Technology and Operations:
o IT Infrastructure: Manages the bank's IT systems and infrastructure to support digital
banking services, data security, and operational efficiency.
o Operations Management: Handles day-to-day banking operations including transaction
processing, customer service, and back-office functions to ensure smooth functioning of
the bank.
7. Human Resources:
o Talent Acquisition and Development: Recruits and develops skilled professionals to
drive organizational growth and innovation.
o Employee Engagement: Fosters a positive work culture and employee satisfaction to
enhance productivity and retention.
8. Marketing and Customer Relationship Management (CRM):
o Brand Management: Develops and implements marketing strategies to enhance brand
visibility and attract new customers.
o Customer Acquisition and Retention: Implements CRM strategies to acquire new
customers, strengthen relationships, and enhance customer loyalty through personalized
service and targeted marketing campaigns.
 12

9. Finance and Treasury:

o Financial Planning and Budgeting: Manages the bank's financial resources through
effective planning, budgeting, and forecasting.
o Treasury Operations: Handles liquidity management, investments, and foreign exchange
transactions to optimize returns and mitigate financial risks.

Each functional area at AU Small Finance Bank operates collaboratively to achieve the bank's strategic
objectives of promoting financial inclusion, providing innovative banking solutions, maintaining robust
risk management practices, and ensuring sustainable growth. By effectively managing these functional
areas, AU Small Finance Bank strives to deliver value to its customers, shareholders, and stakeholders
while contributing to the socio-economic development of India.

Future Plans for Growth

The future prospects of Small Finance Banks in India are promising. As these banks continue to expand
their reach, innovate their product offerings, and leverage technology, they are likely to make
significant contributions to the country's economy. By providing financial services to the unbanked and
underbanked, SFBs can drive consumption, boost entrepreneurship, and contribute to job creation. The
increased availability of credit and banking services will empower individuals and businesses, fueling
economic growth in both urban and rural areas
The growth of Small Finance Banks in India represents a significant development in the banking sector.
These institutions have not only successfully addressed the financial needs of underserved populations
but have also fostered financial inclusion and economic growth. With their rapid expansion, innovative
practices, and digital transformation, SFBs are poised to play a crucial role in shaping India's financial
landscape. By continuing to prioritize the unbanked and underbanked segments of society, Small
Finance Banks can contribute to a more inclusive and robust economy, where individuals and
businesses have access to the financial services they need to thrive.
13
 CHAPTER 4
Analysis and Interpretation
4.1 Ratios

Ratio Values
Current Ratio 0.44
Liquid Ratio 19.27
Cash Position 42.99
Proprietary Ratio 13.61
Solvency Ratio 0
Fixed Assets to Net Worth Ratio 0.11
ROE 12.21
Return on total resources 1.40
EPS 22.98
Interest Coverage Ratio 1.58

Values
Interest Coverage Ratio
EPS
Return on total resources
ROE
Fixed Assets to Net Worth Ratio Values
Solvency Ratio
Proprietary Ratio
Cash Position
Liquid Ratio
Current Ratio
0 5 10 15 20 25 30 35 40 45 50

15
Analysis and Interpretation
AU Small Finance Bank Ltd demonstrates strong financial health, with high liquidity indicators such as a
substantial cash position, liquid ratio, and current ratio, suggesting it can easily meet short-term
obligations. The bank’s profitability is solid, reflected in a good Earnings Per Share (EPS) and Return on
Equity (ROE), indicating efficient management and attractive returns for investors. However, the low
Interest Coverage Ratio and Return on Total Resources suggest potential challenges in covering interest
expenses and optimizing resource utilization. Overall, the bank shows stability and robust liquidity,
though some areas may need attention to improve efficiency.

16
CHAPTER 5
SWOC Analysis
Strengths
Strengths are the positive points of the organization that help it to grow its position in the market and lead to
the company’s success. Here are the strengths of AU Bank:
1. Healthy Customer Base: In 2017, AU Bank had a total of 280,349 active loan accounts and
has been growing ever since. It has also listened to its customers’ financial needs and built
strong relationships with them through one-on-one contact.
2. Broad Range of Portfolio: One biggest strength that AU Bank has is that it offers a wide
range of financial and consulting services to its customers ranging from investment banking,
asset management, private banking and insurance, which give it an edge among other Small
Finance Banks.
3. Talent Management: AU Bank has a highly skilled workforce. This is due to their excellent
training and learning programs. Human resources are an integral part of the success of AU
Small Finance Bank in the consumer financial services industry.
4. Strong Brand Recognition: AU Bank’s products and services are highly recognized in the
consumer financial services industry for the last 28+ years. This allowed the company to
charge a premium compared to its competitors in the consumer financial services industry.
5. Government Support: In November 2017, the Reserve Bank of India added the bank to its
list of commercial banks, reducing the cost of short-term funding and improving the ability of
banks to serve, further enhancing the bank’s growth prospects.
6. Limited Competitive Overlap: AU Bank has little geographical overlap with other small
financial banks, limiting competition among existing players.

Weakness

The weaknesses are the negative points on which the brand must improve upon. For AU Bank,
the following are its weaknesses:

1. Worth billions of dollars. AU Bank is mainly focused on the Indian market, which needs to
increase its reach outside the Indian market as well making it gain more customers.

18
 2. Not in Country’s Leading: Due to its majority of income coming from loans, retail and
personal banking only, it somehow lags in presence in India and other continents compared to
leading Indian banks.

3. Declining Market Share: This is due to the consumer financial services industry growing at
a faster rate than the company. In such a scenario, AU Bank needs to carefully analyze
various trends within the financial sector to understand what to do to drive future growth.

4. Concentration Risk: AU Bank has significant exposure in the four major states that make up
about 70% of its loan portfolio.

5. High Cost to Replace Existing Professionals: Few employees are responsible for the
knowledge base of AU Bank, and their replacement will take up a lot of time and money for
the company.

6. Rising Interest Risk: As the company is primarily wholesale-funded, rising interest rates can
negatively impact borrowing costs and thus profitability.

Opportunity

Opportunities are external elements that are in favor of the company and the firm can use it to its
advantage to grow. The opportunities of AU Bank are given below:

1. Advancements in Technology in the Banking Sector: The banking industry has always
functioned based on technology. AU Bank is known for its best-in-class user- friendly digital
banking offerings. Thus, AU Bank should continue to adopt the latest technological advances.
To draw future generations, they should focus on putting out newer banking and financial
service using Digital Marketing skills.

2. Digital Marketing Skills: Digital marketing skills include various subparts of digital marketing
such as website building, SEO, social media marketing, e-commerce, online reputation and
many more. These courses can get you up to speed in as little as 5 days in a range of digital
skills and expertise.
19
 3. Growth Potential: AU Bank operates in under-penetrated sectors such as vehicle finance,
MSME and small enterprise finances which offers it strong growth potential.
4. Product Growth Potential: The bank is yet to launch several other major lending banking
products and hence has greater growth potential.
5. Expanding the Customer Base in Upper Segments: As customers must move from
unorganized operators in the financial sector to licensed players, AU Small Finance Bank has
the opportunity to enter the entry-level market.

Challenges:
AU Bank's challenges are:
1. Changing Demographics: The baby boomer generation has retired and the new generation is
having a hard time replacing purchasing power. This may increase the profits of AU Bank in the
short term, but younger people are less loyal to brands and more open to experimentation, resulting
in lower profit margins in the long run.
2. Shortage of Skilled Human Resources: Given the high personnel turnover rate and the rising
reliance on new solutions, AU Bank may face issues in this industry in the near future.
3. Dynamic Competition: In the medium to long term, new technologies created by competitors and
the market may constitute a severe challenge to the sector. Because the target profile of customers
of small finance banks is similar to that of current banks, competition is expected to heat up,
particularly in the area of liabilities.
4. Retention of Key Management Personnel: It can be challenging to develop and keep important
executives when several new banks, fintech startups, and established banks compete for the same
talent pool.
5. Regulatory Requirements: Following its transformation into a small bank, AU Bank must meet a
number of regulatory requirements, including CRR, SLR, and higher priority sector lending, which
may have a detrimental impact on its operating performance during the first three years of
operation.
20
 CHAPTER 6
Suggestions and Recommendations
Suggestions for AU Small Finance Bank Ltd
1. Enhance Financial Statement Analysis Tools: Invest in advanced financial analysis tools and
software that provide real-time insights into financial ratios, profitability, liquidity, and solvency
indicators. Ensure staff is well-trained in utilizing these tools to assess a company's financial health and
repayment capabilities accurately.
2. Strengthen Industry Analysis Framework: Develop a comprehensive industry analysis framework
that includes detailed sector reports, competitive analysis, and market trend evaluations. Provide regular
training for staff on industry dynamics and the impact of market trends on credit risk.
3. Focus on Management Evaluation: Implement a thorough process for evaluating the management
teams of potential borrowers. This should include background checks, performance track records, and
leadership assessments, possibly supplemented by third-party evaluations and expert interviews.
4. Incorporate Future Growth Plans in Credit Assessment: Integrate the assessment of borrowers’
strategic initiatives, expansion plans, and market penetration strategies into the credit evaluation process.
Develop standardized templates and criteria for this assessment to ensure consistency and thoroughness.
5. Evaluate Key Buyers and Suppliers: Strengthen the assessment of a borrower's key business
relationships by performing credit checks on major buyers and suppliers. Analyze the stability and
reliability of these relationships to better understand potential risks and the borrower’s ability to generate
consistent cash flows.
Recommendations for AU Small Finance Bank Ltd
1. Leverage Technology for Improved Analysis: Invest in AI and machine learning technologies to
enhance predictive analytics for financial statement analysis, industry trends, and credit risk assessment.
These technologies can improve decision-making and the accuracy of credit evaluations.
2. Enhance Credit History and Collateral Assessment Procedures: Adopt more comprehensive credit
scoring models and regularly update collateral valuation methods. Utilize third-party credit reports to
ensure accurate and reliable assessments of a borrower’s credit history and the quality and value of
collateral.
3. Regular Training and Development Programs: Offer continuous professional development
opportunities, including training programs and certifications focused on financial analysis, risk
management, and industry-specific knowledge. Keeping staff updated with industry best practices and
regulatory changes will enhance their expertise.

22
4. Strengthen Communication with Stakeholders: Establish regular communication channels with
borrowers, investors, and other stakeholders to gather valuable insights and build trust. Creating a
feedback loop can help the bank make informed decisions and improve its credit assessment processes.
5. Adopt a Flexible Approach to Personal Net Worth Assessment: While personal net worth may not
always be a primary factor, consider it on a case-by-case basis, especially for small business owners or
startups. This flexible approach can help tailor credit evaluations to the specific circumstances of
different borrowers.

23
CHAPTER 7
Conclusion
Based on the findings of the survey conducted among credit professionals in the banking industry,
several key conclusions can be drawn regarding the weightage assigned to different parts in analyzing
a company for credit purposes. Although these findings are not based on real data, they provide
insights into potential trends and perspectives.

1. Financial statement analysis emerges as a main focus for credit specialists, with a strong emphasis on
assessing a company's financial health and repayment capabilities. This highlights the need of
evaluating financial ratios, profitability, liquidity, and solvency indicators.
2. Management evaluation is commonly acknowledged to be critical in credit analysis. The
management team's expertise, qualifications, and track record are viewed as critical markers of a
company's capacity to overcome problems and generate corporate performance.
3. While industry analysis is vital, it may not be given the same weight as financial statement analysis and
management evaluation. Understanding industry dynamics and market trends remains important, but it
may not be the major driver of loan choices.
4. Future expansion plans are moderately emphasized, demonstrating that credit professionals
understand the need of evaluating a borrower's strategic objectives and expansion strategies in order
to assess their potential to create cash flows and meet loan commitments.
5. Personal net worth is seen to be less important than other characteristics, implying that credit
specialists may priorities business-related factors above personal financial stability in credit analysis.
6. The evaluation of significant customers and suppliers is deemed important, emphasizing the
importance of evaluating counterparties' creditworthiness and dependability in order to minimize
potential threats to the borrower's cash flows. Credit history and collateral assessment are
overwhelmingly regarded as highly important, emphasizing the critical role of past repayment
behavior, creditworthiness, and collateral quality in determining credit risk and loan repayment
capacity.
25
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26

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 IJSR.net:

 Author. (Year). Title of the document. International Journal of Scientific Research. Retrieved from URL

 CCHealth.org:

 Author. (Year). Title of the document. CCH Health. Retrieved from URL

 NetSuite:

 NetSuite. (n.d.). What is working capital? How to calculate and why it's important. Retrieved from URL

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Annexures

BBA – Summer Internship Weekly Report

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