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‎docs/MFL/LAP/Underwriting/DOA.md‎

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<h3>Delegation of Authority (DOA) – Credit Approval Logic</h3>
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<p>
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The loan approval authority is determined based on two key criteria: <b>Loan Amount</b> and <b>Risk Grade</b>.
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The loan approval authority is determined based on two key criteria: the loan amount and the associated risk grade (refer to the DOA logic at the bottom of this sheet)
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</p>
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<h4>Risk Grade Determination</h4>
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<h4>Risk Grade</h4>
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<ul>
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<li>Derived from BRE 0 during the QDE stage</li>
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<li>Identified using output key <b>final_risk_score</b> from Pre Eligibility Check v0.0.8</li>
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<li>Calculated for primary applicant and all co-applicants</li>
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<li>The highest risk score among all applicants is considered for DOA</li>
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<li>This is derived from the BRE 0 during the QDE stage</li>
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<li>The risk grade is identified using the output key ‘final_risk_score’ in Pre Eligibility Check v0.0.8</li>
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<li>‘final_risk_score’ is obtained for the primary applicant and all co-applicants; the highest risk score among them is considered (as Risk grade) for the DOA decision-making</li>
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</ul>
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<h4>Loan Amount</h4>
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<ul>
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<li>Defined by the BCM in the Loan Offer module</li>
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<li>Approval authority is set when the loan offer is created or updated</li>
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<li>Visible on the <b>Manual Credit Review</b> tab</li>
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<li>This amount is defined by the BCM within the Loan Offer module</li>
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</ul>
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<h4>DOA Process Flow</h4>
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<ul>
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<li>BCM initiates DOA by approving or escalating to the next authority</li>
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<li>Once escalated, the application is locked for edits by BCM and others</li>
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<li>Only higher authorities can manage sanction conditions and deviations</li>
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<li>Escalation is allowed only to the immediate next authority</li>
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<li>Authorities at or below approval level can reject with mandatory reason</li>
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<li>Current loan status is shown in the <b>Current State</b> field</li>
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<li>Cases can be returned downward (recommended only to BCM)</li>
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<li>BCM can reinitiate DOA after return</li>
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</ul>
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<h4>Approval Rules</h4>
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<ul>
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<li>Only approval authority or higher can approve</li>
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<li>Each credit manager has an individual sanction limit</li>
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<li>Approval allowed only if individual limit ≥ loan amount</li>
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<li>If limit insufficient, system auto-escalates upward</li>
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<li>On approval, case moves to <b>In-principal sanctioned</b></li>
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</ul>
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<h4>Task Assignment</h4>
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<ul>
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<li>Appears as <b>Manual Credit Review</b> in authority’s task pool</li>
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<li>Authority must self-assign to take action</li>
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</ul>
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<h4>Deviation Rules</h4>
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<ul>
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<li>DOA cannot start unless all deviations are approved</li>
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<li>If any deviation is rejected, DOA is blocked</li>
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<li>If new deviations are raised mid-DOA, approval actions are frozen</li>
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<li>The approval authority (role level) is established whenever the loan offer is created or updated, as per the DOA approval logic</li>
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<li>This authority role is visible on the ‘Manual Credit Review’ tab</li>
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<li>The BCM initiates the DOA process by either approving the loan or escalating it to the next higher authority, the CCM</li>
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<li>Once the BCM escalates the case, the entire application becomes locked for edits by the BCM and all other users</li>
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<li>During this phase, only higher-level credit authorities can add sanction conditions or manage deviations (raise, approve, or reject)</li>
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<li>Each authority can escalate the case only to the immediate next higher authority in the hierarchy until it reaches the final approval authority</li>
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<li>For example, CCM can escalate only to SCM</li>
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<li>Authorities at or below the approval authority have the option to reject the case, with mandatory input of a rejection reason and sub-reason</li>
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<li>The ‘Current State’ displayed on the Manual Credit Review tab indicates the loan sanction status, such as Approved, Rejected, or displays the current DOA assignee (role level) handling the approval</li>
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<li>Any authority may also return the case to a lower authority for further review (MFL suggests this should be exclusively to BCM, pending implementation)</li>
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<li>Once returned, BCM can reinitiate the DOA flow, passing the case upward authority by authority as before</li>
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<li>Only the approval authority and higher may approve the case, provided the user has sufficient individual sanction limits (following modifications suggested by MFL are pending - approval authority shouldn’t be able to send the case further up)</li>
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<li>Each credit manager, regardless of level, holds an individual sanction limit which may be equal to or lower than the role-level sanction threshold</li>
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<li>For instance, a BCM’s role-level sanction limit for risk grades 1, 2, and 3 might be ₹10 lakhs, but a BCM in Vellore could have an individual limit of ₹8 lakhs</li>
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<li>When an approval authority attempts to approve, the system verifies the individual sanction limit</li>
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<li>Approval is permitted only if the individual limit is greater than or equal to the loan amount</li>
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<li>If the individual sanction limit is insufficient, the case is escalated to the next higher authority</li>
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<li>The system repeats the limit check at every level until reaching an authority with an adequate limit</li>
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<li>Upon approval, the case automatically advances to the next stage “In-principal sanctioned”</li>
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<li>Whenever a case is assigned to a higher authority for DOA by BCM, it appears in that authority’s pool under the task name “Manual Credit Review”</li>
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<li>An authority must self-assign the task to perform any actions on the case, such as approval or rejection</li>
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<li>DOA flow cannot initiate unless all deviations are approved</li>
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<li>If any deviation is rejected, the system prevents initiation of the DOA flow</li>
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<li>If any new deviations are raised by higher credit authorities while DOA is in progress, DOA actioning (loan approval/rejection) isn't allowed until all pending deviations approved</li>
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</ul>
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<h4>Credit Approval Hierarchy</h4>
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<p><b>Branch Mortgage:</b></p>
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<ul>
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<li>BCM → ACM → RCM → SCM → ZCM → NCM → CBO</li>
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</ul>
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<p>Branch mortgage hierarchy:</p>
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<p>BCM → ACM → RCM → SCM → ZCM → NCM → CBO</p>
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<p><b>PC Mortgage:</b></p>
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<ul>
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<li>BCM → CCM → SCM → ZCM → NCM → CBO</li>
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</ul>
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<p>PC mortgage hierarchy:</p>
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<p>BCM → CCM → SCM → ZCM → NCM → CBO</p>
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<p>
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RCM level is currently omitted due to lack of users but may be added later.
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Currently, RCM level is omitted due to absence of RCM users but may be included based on future business needs
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</p>
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<h3>DOA Logic Table</h3>
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<h4>DOA logic</h4>
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<table border="1" cellpadding="8" cellspacing="0">
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<thead>
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<tr>
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<th>Credit Family</th>
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<th>Loan Amount</th>
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<th>Loan Amt$</th>
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<th>Risk Grade</th>
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<th>FOIR</th>
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<th>LTV</th>
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</tr>
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</thead>
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<tbody>
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<tr>
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<td>BCM</td>
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<td>10,00,000</td>
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<td>1,2,3</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>BCM</td>
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<td>5,00,000</td>
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<td>4,5</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>CCM</td>
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<td>15,00,000</td>
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<td>1,2,3</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>CCM</td>
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<td>10,00,000</td>
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<td>4,5,6</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>SCM</td>
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<td>25,00,000</td>
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<td>1,2,3</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>SCM</td>
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<td>15,00,000</td>
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<td>4,5,6</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>ZCM</td>
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<td>30,00,000</td>
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<td>1,2,3</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>ZCM</td>
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<td>20,00,000</td>
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<td>4,5,6</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>NCM</td>
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<td>5,00,00,000</td>
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<td>1–8</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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<tr>
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<td>CBO</td>
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<td>5,00,00,000</td>
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<td>1–8</td>
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<td>50%</td>
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<td>60%</td>
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</tr>
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</tbody>
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</table>
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<tr><td>BCM#</td><td>10,00,000</td><td>1,2,3</td><td>50%</td><td>60%</td></tr>
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<tr><td>BCM#</td><td>5,00,000</td><td>4,5</td><td>50%</td><td>60%</td></tr>
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<tr><td>CCM</td><td>15,00,000</td><td>1,2,3</td><td>50%</td><td>60%</td></tr>
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<tr><td>CCM</td><td>10,00,000</td><td>4,5,6</td><td>50%</td><td>60%</td></tr>
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<tr><td>SCM</td><td>25,00,000</td><td>1,2,3</td><td>50%</td><td>60%</td></tr>
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<tr><td>SCM</td><td>15,00,000</td><td>4,5,6</td><td>50%</td><td>60%</td></tr>
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<tr><td>ZCM</td><td>30,00,000</td><td>1,2,3</td><td>50%</td><td>60%</td></tr>
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<tr><td>ZCM</td><td>20,00,000</td><td>4,5,6</td><td>50%</td><td>60%</td></tr>
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<tr><td>NCM</td><td>5,00,00,000</td><td>1,2,3,4,5,6,7,8</td><td>50%</td><td>60%</td></tr>
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<tr><td>CBO</td><td>5,00,00,000</td><td>1,2,3,4,5,6,7,8</td><td>50%</

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