Traditionally, lenders have faced credit risk in the form of default by borrowers. To this date, credit risk remains major concern for lenders worldwide. The more they know about the creditworthiness of a potential borrower, the greater the chance they can maximize profits, increase market share, minimize risk, and reduce the financial provision that must be made for bad debt. This product provides fundamental understanding of the credit risk analysis process and discusses in detail, various aspects of financial statement analysis, including ratio and cash flow analysis, among others to help in making better credit-related decisions. It also looks at various non-financial factors such as Business Plan, Industry/Sector, Top Management, etc. that could affect the creditworthiness.
Learning Objective:
- Apply credit analysis to assess borrowers in real cases
- Perform ratio analysis and cash flow analysis
- Structure loan products in a competitive way
- Identify and work-out problem loans
Target Audience
Every professional involved in the global financial services industry (as a provider, user, regulator or advisor of product/services, marketplace/exchange) would benefit from KESDEE’s innovative solutions.
Supervisory Agencies
Central Banks
Financial Institutions
Commercial Banks
Investment Banks
Housing Societies/Thrifts
Mutual Funds
Brokerage Houses
Stock Exchanges
Derivatives Exchanges
Insurance Companies
Multinational Corporations
Accountancy Firms
Consultancy Firms
Law Firms
Rating Agencies
Multi-lateral Financial Institutions
Others
Learning Objective:
- Apply credit analysis to assess borrowers in real cases
- Perform ratio analysis and cash flow analysis
- Structure loan products in a competitive way
- Identify and work-out problem loans
Target Audience
Every professional involved in the global financial services industry (as a provider, user, regulator or advisor of product/services, marketplace/exchange) would benefit from KESDEE’s innovative solutions.
Supervisory Agencies
Central Banks
Financial Institutions
Commercial Banks
Investment Banks
Housing Societies/Thrifts
Mutual Funds
Brokerage Houses
Stock Exchanges
Derivatives Exchanges
Insurance Companies
Multinational Corporations
Accountancy Firms
Consultancy Firms
Law Firms
Rating Agencies
Multi-lateral Financial Institutions
Others
Course Content
1. Overview of Credit AnalysisThis course gives an introduction to the concept of credit risk and analysis.Topics covered include:
Stages in credit risk
Importance of credit analysis in credit risk
Principles of credit analysis
Seven Cs of credit analysis
Steps in credit analysis process
2. Lending Process
This course gives an introduction to the lending process followed by banks. It helps the user understand:
Various steps involved in loan appraisal
Components of a bank's lending policy
Loan Documentation
Loan Pricing and Profitability Analysis
Regulations related to lending
3. Financial Statement Analysis-1
This course gives an introduction to the ratio analysis conducted by banks for verifying a companies strength. It helps the user understand:
Various types of ratios including liquidity ratios, turnover ratios, profitability ratios,leverage ratios and market ratios
Importance of these ratios
Comparative analysis
It also has a calculator for calculating various ratios from a Balance Sheet and P & L Account
4. Financial Statement Analysis-2
This course gives an introduction to cash flow analysis. It helps the user understand:
Statement of Cash Flows
Cash flow from operating, investing and financing activities
Direct and indirect method of preparing statement of cash flows
How to interpret cash flows for decision making
5. Non-Financial Analysis
This course explains the importance of non-financial analysis in credit analysis. It deals with:
Economy, Industry and Company (EIC) framework
Models for non financial analysis
Case studies for analysis
6. Asset Classification and Loan Loss Provisioning
Topics covered include:
Need for asset quality assessment
Quantitative and Qualitative Review of asset quality
Categories of asset classification
Special mention assets
Loan classification practices in various countries
7. Borrowing Causes and Sources of Repayment
Topics covered include:
Need for asset quality assessment
Quantitative and Qualitative Review of asset quality
Categories of asset classification
Special mention assets
Loan classification practices in various countries
8. Problem Loans
This course explains the impact of problem loans.It discusses:
Non-performing loans (NPLs)
Methods of resolving NPLs
How to prevent NPLs
9. Consumer Installment Lending
This course introduces the concept of Consumer Installment Lending, which is widely used by lenders. It deals with:
Types and characteristics of consumer installment lending
Various types of Installment loans
Dealer Agreement, Recourse and Dealer Reserve
Common risks faced in consumer installment lending
10. Floor Plan Lending
This course introduces the concept of Floor plan lending which is a specialized revolving line of credit. The course deals with:
Characteristics of Floor Plan Lending
Methods of Floor Plan Lending
Risks Associated with Floor Plan Lending
11. Accounts Receivable and Inventory Lending
This course introduces the concept of Accounts Receivable and Inventory Lending, which is a specialized area of commercial lending used by the lenders. The course deals with the:
Concept of Accounts Receivable and Inventory Based Lending
Risks faced in Accounts Receivable and Inventory Based Lending
12. Participation Loan
This course introduces the concept of Participation Loan used at times of high risk. The course deals with:
The Concept of Loan participation
Need for Loan participation
Process of Loan participation
Risks faced in Loan participation
13. Letter of Credit and Loan Commitments
This course introduces the concept of Letter of Credit and Loan Commitments. The course deals with:
Concept of Letter of Credit (LC)
Types of Letter of Credit
Risks faced in Letter of Credit
Loan commitments, Unfunded lines of credit and their characteristics
Potential credit risk in loan commitments and unfunded lines of credit
