Principles of bank lending to small and medium-sized enterprises

The subject of this thesis is the credit risk and management methods applied in the lending process to small and medium-sized enterprises. Significant attention is paid to stages of credit process, organizational structure of credit department and division of authority, credit policies, rules and procedures, which are applicable in bank for identification, measurement, control and possible reduction of the negative impact of credit risk on bank activities. In this context, there are also discussed methods of assessment of the counter-parties' creditworthiness, which are based on the principles of rating and financial analysis and help bank analytics in decision-making process. The regulatory requirements of the Czech National Bank and innovation in ways of calculation of capital adequacy, which brought the current concept Basel II, have very important role and considerable influence on the management of risks. In the application part of this work the complex analysis of Znovín Znojmo ltd. for illustration of basic banking procedures