The Effectiveness of credit analysis and intelligence in commercial banking credits (application: Gaziantep carpeting sector, 1999-2004)

ABSTRACTTHE EFFECTIVENESS OF CREDİT ANALYSIS AND INTELLIGENCE INCOMMERCIAL BANKING CREDITS(APPLICATION: GAZİANTEP CARPETING SECTOR, 1999-2004)ÖZTÜRK, İsmetM.A. Thesis, Department of EconomicsSupervisor: Assist Prof. Dr. Metin YILDIRIMJuly 2005, 153 pagesOne of the most important procedures of commercial credit applications in banking isthe credit analysis and intelligence reports prepared for the firms applying for credit. The creditanalysis and intelligence is a comprehensive study to assess the credibility of the firm by theinformation about the character, capacity, liquidity, financial position, profitability and sectoralactivities of the firm. When evaluating a credit application, the decision mainly depends on thesecurity, liquidity and profitability principles. Repayment period and conditions, collaterals,credit amount, and pricing must be carefully selected based on the needs of the client. Thesemeasures help minimize the risks taken by the bank. The financial analysis and intelligence studyof our case firm is based on the balance sheets and income statements approved by the Ministryof Finance between 1999 and 2004. The financial analysis study involves two periods, the firstone covering the years 1999 through 2001 while the second one covering the years 2002 through2004.Keywords: Credit analysis and intelligence, Commercial credit, Carpeting sector