Review of loans is an important function of credit management that saves the bank from the risk of default. The review involves monitoring the current loans and taking care of bad loans. Banks may segregate the duties. One is the monitoring of the current loan by reviewing the documentation, perfection of charge on securities, pricing of the loan, and covenants of agreement that are being complied with. The business of the borrower is performing as per expectation and the return and principal is being paid regularly. No early warning signs have been noted. The business is a going concern and meets its obligations.  Bank may create a separate division for tackling bad/ problem loans. It is termed as Special Asset Management Division (SAM). The loan usually turns out to be bad due to poor selection of risk, improper loan structuring, incomplete credit information, technical incompetency, over-lending, emphasis on income, and unforeseen changes in economic conditions. Experts in this division are different in approach to the borrower while negotiating rescheduling, call-off, Asset/ security liquidation, or recommending a legal course for recovery.  SAM may suggest the borrower for infusion of capital, and renegotiate the terms of credit. Bank may let the borrower gain time to reinvigorate his business and pay the loan amount. rescheduling.