How to Evaluate a Borrower's Industry and Management

This course will explain how a borrower’s industry can impact its ability to repay over the business cycle as well as the borrower’s life cycle.  Further, you will be shown how to evaluate the borrower’s resources to operate and compete successfully within its industry.  You will learn which industries are most vulnerable to and which industries are less sensitive to recession in general and  this pandemic recession in particular. 

Next is how to evaluate management, especially its ability and willingness to repay its debts.  We will examine the skills of successful management and review red flags and warning signs of potential management weaknesses.

Topics covered in this session

• Learn how industry factors influence borrower’s ability to repay from cash flow, collateral and guarantees
• Analyze industry structure, competitiveness, and company’s resources and capabilities to operate in its industry
• Discretionary vs. non-discretionary goods and services
• Durable vs. non-durable goods
• Evaluate how industries respond to business cycles
• Generally, management success depends on this combination of factors:
• Grid for evaluating management by function
• Red flags to detect management problems
• Character and fraud detection

Who Should Attend

• Commercial lenders and business bankers
• Credit analysts and credit approvers
• Commercial banking managers
• Chief credit officers
• Loan review officers
• Senior lender
• Commercial underwriters
• Loan committee members bank directors
• Executive management
• Loan documentation preparers and loan booking support staff