Introduction to Credit Risk Analysis

Credit risk analysis is a fundamental skill that never goes out of style. Whatever your industry or department, a solid grounding in evaluating credit risk is highly advantageous if not absolutely required. This one-day course, enhanced by a hands-on case study, provides a framework and overview of the credit analysis process.

No sessions currently available. Contact client services to get the next available date.
CPE CREDITS
7.0
Individuals who require familiarity with credit basics and the associated language, but who do not necessarily work in a credit or finance function.
No advance preparation required.
Students will be able to:
  • Be introduced to credit vocabulary, the process of business & industry analysis, the calculation of historical financial ratios, and the analysis of both historical ratios and cash flow
  • Use these tools to analyze a public company and draw conclusions
Familiarity with corporate balance sheets and income statements. Financial calculator is required.
"Great overview and first brush at a very involved subject."
"The cases and exercises were very helpful."
"Good overview of this very complex field"
Introduction to Credit Risk Analysis
Introductions and Learning Objectives
  • The Credit cycle - Where are we in the cycle?
  • Market trends
  • Investment grade vs. high yield
  • Fallen angels
  • The 5 Ps and 5 Cs of credit

Business and Industry Discussion

  • The Porter Framework
  • SWOT analysis
  • The Cash Conversion Cycle
  • Business vs. Financial risk
  • The Importance of Management
  • Ownership

Purpose and Payment

  • Primary and Secondary Sources
  • Financial Statement Analysis, including the following:
  • - Ratio Calculation and Analysis: Profitability, Asset Effeciency, Liquidity, Debt Service, and Coverage, Leverage & Capital Structure, Performance
  • The Impact of Accounting Methods
  • Off Balance Sheet Considerations
  • Peer Analysis, Trend Analysis, Industry Benchmarks
  • Cash Flow Analysis

Protection

  • Collateral/Liens
  • Guarantees

Perspective

  • Financial Risk Rating
  • Rating Agencies: Who They Are and What They Do
  • Rating Agency Limitations and Implications for the Analyst

Clients who register for this course will receive a complimentary 4-month subscription to FT.com. The Financial Times is the world's most respected financial newspaper, providing a broad assessment on finance, business and the industrial sector. The move to the electronic version follows an ongoing review of our environmental responsibilities as a global business and as part of the Pearson group. FT.com also has features that are not available in hard copy, such as: Special Reports, Alphaville, editor blogs, education sections and much more! Subscriptions will start within 6-8 weeks of the start of class and are limited to one subscription per client. (Please note: as of May 1, 2011, the electronic subscription replaces the hard-copy 3-month Financial Times subscription.)

Lunch is included for all students taking day classes.