The Fundamentals of Credit Risk for the Private Banker
Length: 2.5 Days
This session provides an introduction to credit risk management for the private banker. Participants are provided with a basic grasp of the risks in involved in lending to individuals and focuses on individuals whose wealth is derived from ownership in a small or medium sized business enterprise.
The seminar is divided into the following five sections:
Module I – Introduction to Credit Risk
Includes the Five C’s of Credit Analysis, Sources of Wealth/Wealth Life Cycle, Risks of Lending to Wealthy Individuals, Overview of Personal Financial Statements
Module II – Fundamental Credit Analysis
Includes Individual Income/Cash Flow Analysis, Adjusted Net Worth/Contingent Liabilities, Leverage/Liquidity/Financial Ratios
Module III – Critical Credit Knowledge
Includes Forms of Business Organization, Lending to Business Owners, Lending to Professionals (Physicians and Attorneys), Loan Documentation Basics
Module IV – Loan Structure
Includes Typical Borrowing Needs/Requests of Wealthy Individuals, Loan Structure Fundamentals, Collateral/Guarantees/Covenants, Loan Compliance/Monitoring
Module V – Making the Client Call
Includes Call Preparation and Exploring Additional Banking Opportunities for Existing and Prospective Clients, and Understanding the Perspective of the Underwriter at the Bank in Making Credit Risk Management Decisions.