Pro approval phase (Controllable Variables):
1. Defectiveness in selection of potential borrower
2. Mistake in selection of business where to finance/not to finance
3. Long-drawn appraisement /approval process
4. Poor appraisal technique
5. End use/purpose not properly tracked
6. Defective structuring of credit
7. Under/over financing
8. Imprudent judgment/wrong conception about sectoral viability/ volatility
9. Unusual attachment of importance on collateral security
10. Wrongly conceived projections and not supported by adequate assumptions
Post approval phase:
1. Poor Monitoring
2. Improper/inadequacy in loan documentation
3. Poor MIS
4. Un favorable Investment Climate
5. Economic Recession
6. Inconsistent and erratic govt. fiscal policy
7. Credit Culture promote loan default