Stressed Asset Management for a Tanzanian Bank

GBRW Consulting, GBRW Group, Problem Loan Management, Risk Management

GBRW was appointed by this leading Tanzanian commercial bank to develop and deliver a detailed suite of policies and procedures for identifying, transferring, and then managing Non-Performing Loans.

GBRW worked on-site with the Bank to deploy turnaround and recovery operating procedures, implement practical early warning indicators, review the bank’s delinquent loans assessment tools, develop the process for monitoring and transferring delinquent loans, and implement an overall framework for performing loan sector analysis.

The process involved reviewing, assessing, and assisting the Stressed Asset Management Unit in CRDB Bank in developing turnaround and recovery operating procedures in line with the prevailing credit policy. GBRW also supported the Stressed Asset Management Unit in developing indicators for assessing potential future default borrowers within CRDB Bank’s current portfolio of performing loans. A key component of the Early Warning System was the design of sectoral analysis frameworks that provide insight regarding appropriate criteria to assess and monitor (proactively) when analysing different industries.
Finally, GBRW also reviewed and made recommendations on top the Stressed Asset Management Unit on the design of a reporting framework that facilitates the Unit’s ability to monitor/manage their responsibilities, and report to Senior Management.

Deliverables included:

- Review and discussion of current turnaround and recovery procedures, and development and delivery of new/modified turnaround and recovery operating procedures in line with the prevailing credit policies of the Bank;

- Review and discussion of current credit appraisal process, and design and delivery of new/modified tools that enhance the appraisal and transfer of loans from the Business Units to the Turnaround Unit and from the Turnaround Unit to the Recovery Unit;

- Development of a list of warning signals for potential defaulters, as well as information regarding appropriate steps (actions) to take when said warning signs occur;

- Development of sectoral framework analysis that provided insight regarding criteria to use when analysing sectors; and

- Review and discussion of the current reporting, and design and delivery of new/modified reporting framework that enhances reporting within the Stressed Assets Management Unit.