Our lending policy defines the main approaches of the Bank to corporate customer financing. When making a credit decision, the bank authorities are guided by the provisions of the credit policy.
The scope of the lending policy is the basis for making credit decisions.
The main targets of the Bank’s lending policy are:
- financing of the most profitable projects with good potential;
- diversification of loan portfolio and acceptance only of risks, which would enable good quality assets;
- initiation of the Bank’s activity in target industries with the purpose of attracting new customers
The Bank does not finance:
- production of any types of arms,
- the gambling industry,
- production of geneticly modified products and/or materials,
- non-commercial organizations,
- production, storage, cleaning and utilization of atomic fuel,
- production with a high level of environmental risk.
General conditions of financing:
The Bank aims to reduce the amount of financing to customers who are systematically late in making their principal and interest payments.
The Bank aims to reduce the amount of loans to customers who use barter forms of payment in their businesses.
The Bank finances customers who are residents of the Republic of Belarus.
A preference is given to customers who have current accounts with Priorbank, and a turnover via these accounts. For customers of other banks, the bank will make decisions about financing on a case by case basis.
Collateral:
According to Priorbank’s standards, loans must be fully collateralized as per legislation of the Republic of Belarus and local standard acts of Priorbank. As collateral the Bank uses: deposits, pledges of securities, pledges of goods and fixed assets (buildings, technological, trade and office equipments, motor transport, etc.), assignment of receivables, pledges of third-party property, mortgage, transfer of legal title, bank guarantee, default risk insurance.
Cost of financing:
The following principles build the base of our interest-bearing policy:
- expense approach, allows us to consider the direct cost of each product to the Bank,
- market method, considers the level of rates in financial markets for similar products,
- estimation of level of the risks accepted by the Bank.
The following facts influence the interest rates:
- cost of funding,
- level of assignments to the National Bank of Belarus according to local standards,
- Bank transaction costs,
- term of financing.
Interest rate fluctuation depends on the cost of funding on international markets (LIBOR rate) and of the home market (refinancing rate, cost of funds on interbank marker, level of interest rates for deposits for individuals and legal entities.)