RBB Assistant Manager key terms

A loan on which the borrower has stopped making scheduled payments for a set period, typically classified as substandard, doubtful, or bad loss. Banks must provision capital against such loans, reducing profitability and lending capacity.

An expense set aside from earnings to absorb estimated losses on loans that may not be recovered. The size of the provision depends on the loan's classification and the value of available collateral.

An asset pledged by a borrower to secure a loan, which the lender may seize and sell if the borrower defaults. Common forms include land, buildings, vehicles, gold, and fixed deposits.

The loan amount expressed as a percentage of the appraised value of the property or asset securing it. Higher ratios mean more risk to the lender and usually trigger stricter conditions.

The structured assessment a lender performs before approving a loan, covering repayment capacity, character, collateral, capital, and business conditions. It concludes with a recommendation on amount, tenor, pricing, and conditions.

A standard framework for judging a borrower: character, capacity, capital, collateral, and conditions. Each dimension helps the lender decide whether the borrower can and will repay.

A measure of a borrower's ability to cover loan instalments from operating income. It divides net operating income or cash flow by total debt service, with a ratio above one indicating a surplus.

Short-term credit used to fund day-to-day operations such as buying inventory and paying wages while awaiting customer receipts. Common forms include overdrafts, cash credit, and bills discounting.

A revolving facility allowing a business to draw funds up to an approved limit as needed and repay from collections. Interest is charged on the amount actually used, not the full limit.

A facility permitting a customer to withdraw more than the available balance up to a sanctioned limit. It is usually short-term and secured, with interest charged on the daily debit balance.

Changing the original terms of a loan, such as extending the tenor or lowering the rate, when a borrower faces temporary repayment difficulty. Restructured accounts often attract extra provisioning and closer monitoring.

A regulatory requirement obliging banks to direct a minimum share of credit to designated sectors such as agriculture, small enterprises, and deprived groups. Shortfalls may require contributions to a specified fund.

Loans provided to farmers and agribusinesses for crop production, livestock, irrigation, and equipment. Such credit is often seasonal, secured by land, and supported by subsidised interest schemes.

A short-term loan to finance the inputs of a single cropping season, such as seed, fertiliser, and labour, repaid from harvest proceeds. Repayment schedules are aligned to the crop cycle.

The process of identifying customers and verifying their identity, address, and beneficial ownership before opening accounts or providing services. It underpins monitoring, reporting, and risk management.

Ongoing checks on a customer's identity, transactions, and risk profile, scaled to the perceived risk. Enhanced measures apply to high-risk customers such as politically exposed persons or cash-intensive businesses.

The natural person who ultimately owns or controls an account, company, or transaction, even if a nominee or another entity appears as the legal holder. Identifying them prevents concealment of true control.

A person entrusted with prominent public functions, along with close family and associates, who presents a higher money-laundering risk. Such customers require senior approval and enhanced ongoing monitoring.

A confidential report filed with the financial intelligence unit when a transaction appears linked to illegal activity. Filing must be timely, and staff involved are prohibited from tipping off the customer.

A report submitted for cash or specified transactions above a regulatory amount, regardless of suspicion. It creates a data trail for the financial intelligence unit and supports later investigation.

Laws, rules, and internal controls designed to stop criminals from disguising the origin of illegal funds through the financial system. Banks implement it through identification, monitoring, reporting, and record-keeping.

Measures that prevent funds from reaching terrorist individuals or organisations, including screening against sanction lists and reporting suspicious flows. It is enforced alongside anti-money-laundering controls.

Checking customers, counterparties, and transactions against national and international watchlists before processing. A match triggers escalation, freezing, or rejection according to policy and legal instruction.

Binding instructions issued by the central bank to regulated institutions on matters such as capital, liquidity, lending, and reporting. Compliance is mandatory and breaches can attract penalties or licence restrictions.

A bank's capital expressed as a percentage of its risk-weighted assets, showing how much cushion exists against losses. Regulators set a minimum, and shortfalls limit dividends and expansion.

A bank's assets adjusted for credit, market, and operational risk, so riskier exposures count more heavily. The total is used as the denominator when computing capital adequacy.

The share of customer deposits a bank must hold as cash with the central bank, earning little or no interest. Raising it reduces funds available for lending.

The minimum share of deposits a bank must hold in liquid assets such as government securities, cash, or gold. It protects depositors and supports liquidity in stressed conditions.

The danger that a bank cannot meet obligations as they fall due without costly borrowing or forced asset sales. It is managed through liquid buffers, deposit diversification, and maturity matching.

The coordinated management of a bank's assets and liabilities to control interest rate, liquidity, and maturity mismatches. Committees review gaps and set pricing and funding strategies accordingly.

The exposure of earnings or capital to changes in market interest rates. It arises when assets and liabilities reprice at different times or in different amounts.

A financial statement showing cash generated and used across operating, investing, and financing activities over a period. Lenders use it to judge whether repayment can be met from real cash.

An account a bank holds with a foreign correspondent bank in that bank's currency, used to settle international payments. Its mirror image, the vostro account, is held by the correspondent for the same purpose.

An arrangement in which one bank provides payment, settlement, and other services to another bank in a market where the latter has no presence. It enables cross-border transfers and trade finance.

A secure messaging network used by financial institutions to exchange payment instructions and related information internationally. It carries messages, not funds, which move through correspondent accounts.

A transfer of money, often across borders, from a sender to a recipient, frequently by migrant workers to family. Service providers must verify identity and report under applicable rules.

A reversal of a card transaction initiated by the issuer on the cardholder's behalf after a dispute, such as fraud or non-delivery. The merchant or acquirer must respond with evidence within set deadlines.

The business of enrolling merchants to accept card payments and settling those funds to them after deducting fees. The acquirer bears merchant risk and handles chargebacks.

The fee a merchant pays on each card transaction, shared among the acquirer, issuer, and network. It is usually a small percentage of the transaction value.

A fee paid by the merchant's bank to the cardholder's bank for each transaction, set by the card network. It forms part of the total cost borne by the merchant.

The structured process for investigating and settling a customer complaint about a transaction or service. It involves evidence gathering, timelines, and escalation to an ombudsman or regulator if unresolved.

A formal system for receiving, tracking, and resolving customer complaints within defined time limits. Effective systems include named officers, escalation levels, root-cause analysis, and reporting to the board.

A documented commitment on response and resolution times for a service or complaint. It sets expectations, supports accountability, and is often used to measure operational performance.

A measurable value used to judge how well a team or process is achieving a business objective. Good indicators are specific, attributable, and reviewed regularly against targets.

A management framework that tracks performance across financial, customer, internal process, and learning perspectives. It balances short-term results with capabilities needed for future success.

Policies, procedures, and checks designed to safeguard assets, ensure accurate records, and prevent error or fraud. Segregation of duties and independent verification are core elements.

The risk of loss from failed processes, people, systems, or external events, including fraud and cyber incidents. It is managed through controls, insurance, and business continuity planning.

A documented plan for maintaining or restoring critical operations during and after a disruption such as a disaster or system outage. It defines roles, alternate sites, and recovery priorities.

Opening accounts or enrolling customers remotely using digital identity checks such as document scanning, biometrics, and video verification. The process must meet the same identification standards as branch onboarding.

A login method requiring two independent proofs of identity, such as a password plus a one-time code. It reduces the risk of account takeover when a password is compromised.

A fraud technique using fake messages or websites to trick people into revealing credentials or authorising payments. Banks train staff and customers to recognise and report such attempts.

A digital account, often linked to a phone number, that stores funds for payments and transfers. Providers must apply identity verification and transaction limits set by the regulator.

A protection scheme that reimburses depositors up to a set limit if a bank fails. It maintains public confidence and is funded by premiums paid by member institutions.