How do traditional banks design loan contracts to ensure their own interests?

When designing loan contracts, traditional banks usually adopt the following strategies to ensure their own interests:

1. interest rate setting: the bank will set different interest rates according to the loan term, the borrower's credit and other factors, so as to ensure that it can recover the loan principal and obtain certain income at the same time.

2. Collateral requirements: The bank will require the borrower to provide collateral to reduce the risk, so that if the borrower fails to repay on time, the bank can rely on collateral to recover the arrears.

3. collateral requirements: the bank will require the borrower to provide collateral to reduce the risk, so that if the borrower fails to repay the loan on time, the bank can rely on the collateral to recover the arrears.

4. Loan review: Before designing the loan contract, the bank will review the borrower to assess its credit status and repayment ability, thus reducing the risk.