First National Federal Bank Case Study Example | Topics and Well Written Essays - 1500 words - 2

outset National Federal Bank - Case Study ExampleIn business today, the antiquated adage about honesty is the best policy still holds true and it is more important than ever.Problem this case deals with an ethical leave regarding the business practices of the First National Federal Bank located in the state of Wyoming. Loan officers are now required by the bank to adhere to changes implemented by and by the savings and loan debacle with regard in neighborhoodicular to ethical business practices. This emphasis on ethics is to avoid those problems that arose due to unsavory policies and procedures concerning the commendation of bank loans. In this particular case, the issue at hand is whether to let a loan applicant pay for the cost of the officers out of town sex purposely to inspect the hard collateral offered by a client for his loan. It is a standard practice in the banking industry to require collaterals in supersede for a loan. A bank requires collateral as a guarantee f or refund because a loan client would rather not be in a position of abandoning his hard-earned collateral and lose it through foreclosure if a loan turns sour (bad). There is also ambiguity between what is legal and what is ethical (moral).Inputs - the issue that bothered Shelby Grant the most was the question of whether to let one of their potential loan clients (Mr. Doug Whitton) pay for their trip to a ranch he owns as part of the banks due diligence process of conducting an on-site evaluation (appraisal) of the offered collateral. At this point, it may seem unethical to let a client shoulder the expenses since there is no assurance the loan would be granted. Besides the collateral, there are factors that may work against loan approval such as credit history and repayment capacity (source of income to pay back the loan). If the two loan officers, Shelby Grant and Ben Garrison, would allow or accept the clients offer to pay for their trip, it may appear a piece awkward for them .