Tuesday, October 18, 2022
12:00 – 1:00 pm (Eastern Time)
11:00 – 12:00 pm (Central Time)
10:00 – 11:00 am (Mountain Time)
9:00 – 10:00 am (Pacific Time)
Financial organizations extend credit to borrowers when the borrowers show the ability to repay the loans extended. Ideally, a request for a five-year loan should be supported by a 5-year cash flow projection, and a request for a seasonal line of credit should be supported by a 12-month cash flow projection to identify when the borrower is likely to borrow and when the borrower can repay the line of credit in full.
One of the most basic analytical and underwriting tools a banker must have is the ability to determine whether a borrower can repay its short-term borrowings based on the financial information available.
- This lending webinar will explain the interrelationships among revenue projections, the expenses needed to support seasonal sales growth as well as the working capital assets, fixed assets, and liabilities necessary to support revenue growth.
- Second, the training will offer tips on how to analyzing underlying assumptions such as profitability, productivity, efficiency, and earnings retention.
Join us in this critical lending webinar as you are shown how to use a borrower’s historic financials to project monthly balance sheet, income statement, and cash flows over the borrower’s fiscal year and seasonal expansion and contraction.
Areas Covered in This Session: Attendees will gain an understanding about:
- The critical role of revenues in projecting financial statements and cash flow
- The projection of income statement, balance sheet and cash flow to calculate loan needed to support projection and ability of the borrower to repay in full
- Evaluating underlying assumptions including the feasibility of seasonal revenue growth rate, profitability, productivity, efficiency, earning retention, and leverage
- Calculating the loan amount needed to support financial projection and borrower’s repayment ability
- Analyzing and assessing asset collateral base available to support repayment
Attendees will also learn:
- How seasonal revenue projection determines income statement and income statement determines balance sheet
- Critical role of working capital assets, capital expenditures and retained earnings in supporting projection
- How to generate 12-month cash flow projection with balance sheet and income statement
- How to estimate size of line of credit needed to realize financial projections
- How to underwrite line of credit needed to fit lending organization’s policies
- How to support loan with appropriate collateral and guarantees
Who Will Benefit: Credit analysts, underwriters, commercial bankers, loan review officers, senior lenders, credit department managers, chief credit officers
1.0 CPE Credits & 1.2 AAP Credits