Why you should attend
This program is designed to show bankers, lenders, and credit professionals how to evaluate a borrower's operating performance and financial condition. Good operating performance and a sound financial condition
- Operating Performance:
- how to evaluate a borrower's operating performance-revenue generation, productivity, efficiency, and profitability as they analyze the information disclosed in its income statement.
- how to identify the critical elements of the profit and loss statement and their roles in driving a business borrower's operating performance.
- how to judge a borrower’s operating performance trends and results against industry averages
- Financial Condition:
- liquidity-how to assess a borrower's ability to meet short-obligations
- leverage-how to measure a borrower's ability to meet its debt and owner obligations
- solvency-how to evaluate a borrower's ability to balance needed assets growth, debt repayment, and shareholder expectations
Agenda
- Operating Performance:
- P&L's key components-revenue, cost of goods sold, gross profit, operating expenses, profit before taxes, taxes, profit after taxes
- Revenue growth-actual sales growth vs sustainable growth rate
- Break-even analysis-how much revenue does a borrower need just to cover its expenses?
- Operating leverage-the smaller the gross profit, the more vulnerable a borrower's profitability is to declining revenues
- Production vs. productivity
- Profit margins-gross profit margin, before-tax profit margin, after-tax profit margin
- Analysis of return on sales, return on assets, return on equity
- Profit vs cash flow-why profit is not always equal to cash flow
- A case study is used to demonstrate how to evaluate operating performance
- Financial Condition:
- Liquidity-borrower's ability to meet its short-term obligations
- Current/Quick Ratios
- Working Capital Analysis
- Leverage-borrower’s ability to balance its sources of funds from creditors and owners
- Various ratios to measure the proportion of support provided by owners and creditors
- Ensuring matching of short-assets with short-term debt, long-term assets with L-T debt
- Solvency-borrower's ability to internally sustain its asset base, pay its obligations and reward its owners
- Measures for determining the ability of the firm to simultaneously satisfy the expectations of lenders and owners while maintaining the earning assets of the firm
- Sustainable growth vs. actual growth
- Use of industry ratios to measure borrower's financial condition to its peers
- A case study is used to demonstrate how to evaluate the financial condition
- Liquidity-borrower's ability to meet its short-term obligations
Speaker
Dev Strischek A frequent speaker, instructor, advisor, and writer on credit risk and commercial banking topics and issues, Dev is principal of Devon Risk Advisory Group and engages in consulting, speaking and training on a wide range of risk, credit, and lending topics. As former SVP and senior credit policy officer at SunTrust Bank, Atlanta, he was responsible for developing, implementing, and administering credit policies for SunTrust's wholesale lines of business--commercial, commercial real estate, corporate investment banking, capital markets, business banking, and private wealth management. He also spent three years as managing director and credit approver in SunTrust's Florida commercial lending and corporate investment banking areas, respectively. Prior to SunTrust, Dev was chief credit officer for Barnett Bank's Palm Beach market. Besides stints at other banks in Florida, Kansas City, and Ohio, Dev's experiences outside of banking include CFO of a Honolulu construction company, combat engineer officer in the U.S. Army, and college economics instructor in Hawaii, Missouri, and Florida. A graduate of Ohio State University and the ABA Stonier Graduate School of Banking, he earned his M.B.A. from the University of Hawaii.
Who Should Attend
- Credit Analysts
- Credit Managers
- Loan review officers
- Work-out officers
- Commercial Lenders
- Credit Risk Managers
- Chief Credit Officers
- Senior Lenders
- Senior Lending Officer
- Bank Director
- Chief Executive Officer
- President
- Board Chairman
