Accredited by the Chartered Institute of Bankers Scotland
Business Issue - In the past, most lenders learned their craft through an informal process of apprenticeship—by watching and listening to the more experienced lenders. But few lenders have learned a consistent and systematic approach to corporate credit analysis. Experienced lenders rarely explain their techniques and seldom have time to train junior staff thoroughly. The Credit Skills Development (CSD) programme fills the need for systematic, consistent training.
Omega Performance’s Solution - The CSD programme modules are designed to help bankers learn and develop basic corporate lending skills and provide them with a step-by-step strategy for making sound commercial credit decisions. Participants learn how to gather data needed for analysis and decision-making, assess the risks of a prospective loan and structure and document a commercial loan package. The chief emphasis of the programme is on risk analysis—identification of credit risks associated with a corporate loan and the development of strategies to manage identified risks.
The programme is aimed at both credit and relationship management teams—in short, at all those involved in the writing and assessment of credit proposals. It aims to give them a solid foundation in the identification, assessment and management of credit risks, essentially those factors contributing to the probability of default under Basel II. It also deals with facility structuring and so (if for example, combined with your own policies on security taking and valuations), could also contribute to the assessment of exposure default and loss, given default.
What Is Included
The Credit Skills Development modules teach the technical skills (such as cash flow analysis) needed to become proficient in this area. The material places strong emphasis on qualitative analysis of a customer’s products, the market in which it operates and the company’s management expertise, as well as specific quantitative analysis methods.
CSD modules provide corporate lenders with the skills and information they need to make sound, well-informed loan decisions. The 18 modules cover the following:
- Introduction to Business Lending
- Forms of Business Organisation
- Screening the Loan Proposal
- Introduction to Accrual Accounting
- The Asset Conversion Cycle
- Industry Risk Analysis
- Accounting for the Operating Cycle
- Accounting for the Capital Investment Cycle
- Accounting for Liabilities and Equity
- Financial Reporting and Full Disclosure
- Financial Statement Analysis
- Borrowing Causes
- Loan Structure and Documentation
- Opportunity Assessment
- Business Risk Analysis
- Cash Flow Analysis
- Projections
- Loan Management
Delivery Options
Omega Performance offers flexible delivery options, which are self-study or self-study plus workshop.
Credit Skills Development is also available online, including pre- and post-testing.
Modules generally require 3–6 hours of self study plus assessment time.
Prerequisites
Participants should have a solid grasp of accounting fundamentals. Omega Performance’s Credit Skills Assessment can help you determine if training in accounting is necessary.
Results You Can Expect
Credit Skills Development helps you and your lenders:
- Identify and evaluate a customer’s needs for both short-term and long-term financing
- Analyse and evaluate the financial and non-financial risks of lending to a particular customer
- Evaluate the risks inherent in the customer’s industry and business environment and in the company’s business cycle
- Project and analyse the customer’s ability to repay the proposed loan
- Explain the basis of a decision to lend or not to lend • Identify and evaluate loan structures and appropriate covenants
- Examine and determine ways of managing the lending relationship
- Understand both the bank’s and the customer’s requirements in a corporate lending relationship
- Understand and apply the banking, legal and regulatory requirements placed on the bank when maintaining a lending relationship
Who Should Be Trained
CSD is recommended for:
- Entry-level and mid-career commercial lenders
- Entry-level and mid-career credit analysts
- Credit administration staff
- Loan review staff
- Management trainees
The training has also proven effective for officers in international lending, regional loan administration, credit policy, business development, and other departments that support the commercial lending function.