In terms of communication no. DBR: BP: No. 1775 /21.06.007/2018-19 dated 30th August, 2018, RBI has directed that “The CRA shall obtain bank statements of the rated entities and critically analyse these as an input to determine the debt serving capacity of the entity”. The matter was discussed among CRAs and RBI officials as well. Based on the consensus arrived at, INFOMERICS has decided to follow the following procedure in this regard:

1. All the clients shall be advised to submit their Bank loan statement for the preceding six months at the time of bank loan rating and annual surveillance/review provided more than six months have passed since last rating/surveillance.

2. In case of large consortium advances/multiple banking, statement of account shall be obtained from the major lenders covering minimum of 50% exposure being rated.

3. The statement of account pertaining to prime operative accounts such as Current Account, Cash Credit/Overdraft and Term Loan Accounts shall be obtained.

4. The analysis on bank statements by Analysts will largely confine to the following:

i) Overdrawing in the account beyond the limit sanctioned, periodicity, regularity and clearance.

ii)Checking imposition of penal interest and penal charges, if any, and ascertaining the reasons thereof.

iii)Servicing of monthly/quarterly interest

iv)Average Utilization of limits which will support the debt servicing capacity of the client.

5.INFOMERICS shall compile a list of such clients who have partially or fully not submitted the bank loan statements at the time of initial rating/surveillance/review and submit to RBI designated office after the expiry of each calendar quarter.