20+ Executive Ship Management Interview Questions and Answers

I would assess the situation and try to find alternative ways to verify the client's identity and creditworthiness.

• Ask the client if there are any other forms of identification they can provide

• Check if the client has any existing accounts or relationships with the bank

• Ask for references or guarantors who can vouch for the client's credibility

• Consider alternative credit scoring methods such as social media or utility bill payments

• Evaluate the risk and potential consequences of...read more

I will check the client's financial history, credit score, business plan, collateral, and repayment ability.

• Check the client's credit score and financial history to assess their creditworthiness

• Evaluate the client's business plan and long-term project to ensure it is viable and profitable

• Assess the client's collateral to determine its value and potential for resale

• Verify the client's repayment ability through income statements, cash flow projections, and other financial docum...read more

Before sanctioning a loan, I check various information and documents.

• Credit score and credit history of the borrower

• Income and employment details of the borrower

• Collateral offered by the borrower

• Purpose of the loan

• Legal documents like ID proof, address proof, and income proof

• Bank statements and tax returns

• Credit reports from credit bureaus

• Business plan and financial statements for business loans

I would assess the applicant's creditworthiness based on their credit history, income, and debt-to-income ratio.

• Check the applicant's credit score and credit report

• Verify their income and employment status

• Calculate their debt-to-income ratio

• Consider any past delinquencies or bankruptcies

• Assess the purpose of the loan and the likelihood of repayment

• Review any collateral offered as security

I will check liquidity, profitability, and solvency ratios before granting a loan to a company.

• Liquidity ratios such as current ratio and quick ratio to ensure the company has enough short-term assets to cover its liabilities

• Profitability ratios such as return on assets and return on equity to assess the company's ability to generate profits

• Solvency ratios such as debt-to-equity ratio and interest coverage ratio to evaluate the company's long-term financial health

• Examples of ...read more

Reading a balance sheet involves analyzing a company's assets, liabilities, and equity.

• Start by identifying the assets, which are listed in order of liquidity.

• Then, identify the liabilities, which are listed in order of maturity.

• Finally, analyze the equity section, which shows the company's net worth.

• Compare the assets and liabilities to determine the company's financial health.

• Look for trends over time to identify changes in the company's financial position.

• Examples of asset...read more

Yes, I have some information about tractors.

• I know that tractors are commonly used in agriculture for plowing, tilling, and planting.

• Tractors come in different sizes and types, such as utility tractors, row-crop tractors, and compact tractors.

• I am aware that some tractors are equipped with attachments like loaders, backhoes, and mowers.

• I also know that tractors require regular maintenance and repairs to ensure their optimal performance.

Working capital is the amount of money a company has available to fund its day-to-day operations.

• Working capital is calculated by subtracting current liabilities from current assets.

• It is important for a company to have enough working capital to pay for expenses such as rent, salaries, and inventory.

• If a company has negative working capital, it may struggle to meet its financial obligations.

• Examples of current assets include cash, accounts receivable, and inventory.

• Examples o...read more

Cash credit and bank overdraft are two types of short-term credit facilities offered by banks.

• Cash credit is a type of loan where the borrower is given a credit limit and can withdraw funds as needed, usually for working capital purposes.

• Bank overdraft is a facility where the borrower is allowed to withdraw more money than they have in their account, up to a certain limit.

• Both cash credit and bank overdraft are short-term credit facilities and are usually secured by collatera...read more

Lending policies are guidelines set by financial institutions to determine who can borrow money and under what conditions.

• Lending policies are based on factors such as credit score, income, debt-to-income ratio, and collateral.

• Financial institutions use lending policies to manage risk and ensure that borrowers are able to repay their loans.

• Lending policies may vary depending on the type of loan and the institution offering it.

• For example, a mortgage lender may have stricter l...read more

Fund based lending involves actual transfer of funds to borrower, while non fund based lending involves guarantee or letter of credit.

• Fund based lending involves direct transfer of funds to borrower for use, such as term loans or working capital loans

• Non fund based lending involves providing guarantee or letter of credit to borrower without actual transfer of funds

• Examples of fund based lending include cash credit facilities, overdrafts, and term loans

• Examples of non fund bas...read more

Check points for assessing loan proposals include financial stability, credit history, repayment capacity, collateral, and purpose of the loan.

• Financial stability of the borrower

• Credit history of the borrower

• Repayment capacity of the borrower

• Collateral provided by the borrower

• Purpose of the loan

Points to check in CIBIL report include credit score, payment history, credit utilization, and credit inquiries.

• Credit score: Check if the score is within the acceptable range.

• Payment history: Ensure all payments are made on time and there are no defaults.

• Credit utilization: Verify the percentage of credit limit being used.

• Credit inquiries: Check for any recent inquiries which may impact the credit score.

A Bank Guarantee is a promise from a bank to pay a specified amount if the beneficiary fails to fulfill their obligations.

• It is a type of financial instrument used to secure payment in international trade

• It is often used in construction projects to ensure completion of the project

• The bank issuing the guarantee is liable to pay the beneficiary if the terms of the guarantee are not met

• It is commonly used in import/export transactions to ensure payment to the exporter

Check points while underwriting

• Evaluate the borrower's credit history and credit score

• Assess the borrower's income and employment stability

• Review the borrower's debt-to-income ratio

• Analyze the borrower's collateral or assets

• Consider the borrower's repayment capacity

• Verify the borrower's financial documents

• Assess the borrower's payment history and credit utilization

• Evaluate the borrower's industry and market conditions

Current ratio is a financial ratio that measures a company's ability to pay its short-term liabilities with its short-term assets.

• Current ratio is calculated by dividing current assets by current liabilities.

• A ratio of 2:1 is considered healthy, indicating that the company has twice as many current assets as current liabilities.

• A ratio below 1:1 indicates that the company may have difficulty paying its short-term debts.

• Current ratio is important for creditors and investors to...read more

Debtor days refer to the average number of days it takes for a company to receive payment from its customers.

• It is a measure of a company's accounts receivable efficiency

• Calculated by dividing accounts receivable by average daily sales

• A lower debtor days ratio indicates better cash flow management

• Example: If a company has $100,000 in accounts receivable and its average daily sales are $10,000, its debtor days would be 10 days

Risk is the potential for loss or harm resulting from an action or decision.

• Risk is the likelihood of an event occurring and the impact it will have.

• It involves identifying potential hazards and assessing their likelihood and impact.

• Examples of risks include financial risks, operational risks, and reputational risks.

• Risk management involves taking steps to mitigate or avoid risks.

• Effective risk management can help organizations achieve their objectives while minimizing potent...read more

Quick ratio is a financial ratio that measures a company's ability to meet short-term obligations with its most liquid assets.

• Quick ratio is also known as acid-test ratio.

• It is calculated by dividing the sum of cash, marketable securities, and accounts receivable by current liabilities.

• A quick ratio of 1:1 or higher is considered good.

• It helps in assessing a company's liquidity position and ability to pay off short-term debts.

• Example: If a company has $100,000 in cash, $50,00...read more

I process an average of 50 files per day.

• On average, I handle 50 files daily.

• The number of files I process per day is around 50.

• I typically deal with approximately 50 files each day.

DSCR stands for Debt Service Coverage Ratio, which is a financial ratio that measures a company's ability to pay its debts.

• DSCR is calculated by dividing a company's operating income by its total debt service obligations.

• A DSCR of 1 or higher indicates that a company is generating enough income to cover its debt payments.

• A DSCR below 1 means that a company may have difficulty meeting its debt obligations.

• Lenders often use DSCR to assess the creditworthiness of a borrower befo...read more

The 5 C's of credit are character, capacity, capital, collateral, and conditions, used by lenders to evaluate a borrower's creditworthiness.

• Character: Refers to the borrower's reputation and credit history.

• Capacity: Refers to the borrower's ability to repay the loan based on income and existing debts.

• Capital: Refers to the borrower's assets and net worth.

• Collateral: Refers to assets that can be used as security for the loan.

• Conditions: Refers to external factors that may affe...read more

Ratios used in credit analysis

• Liquidity ratios: current ratio, quick ratio

• Profitability ratios: return on assets, return on equity

• Debt ratios: debt-to-equity ratio, debt service coverage ratio

• Efficiency ratios: inventory turnover, accounts receivable turnover

• Examples of industry-specific ratios: net interest margin for banks, occupancy rate for hotels

I handle credit products for various industries.

• I manage credit lines and evaluate creditworthiness for clients in different sectors.

• I analyze financial statements, credit reports, and other relevant data to assess risk.

• I collaborate with sales teams to establish credit terms and conditions for customers.

• I monitor credit limits, payment terms, and collections to ensure timely payments.

• I provide recommendations for credit limit adjustments and credit risk mitigation strategies...read more