Quality Seal Emagister EMAGISTER CUM LAUDE

Commercial Loan Portfolio Management

London Financial Studies
En London (Inglaterra)

£ 3.435 - (4.075 )
+ IVA

Información importante

  • Short course
  • London (Inglaterra)
  • Duración:
    3 Days
  • Cuándo:
    06/03/2017
Descripción

A comprehensive toolkit for the effective management of a commercial loan portfolio, covering best practice credit analysis, loan structuring and pricing, risk management and distressed workouts. Focused on practical application, the course covers 6 workshops and 18 case studies taken from a variety of UK, European and US companies.

Información importante
¿Qué objetivos tiene esta formación?

Day 1 focuses on credit analysis, financial modelling and stress testing from a commercial lender’s perspective, together with credit risk mitigation through security packages, covenants and guarantees.

Day 2 focuses on distressed loan workouts, from early warning signals, entry into distress and lender preparation for distress, through short term and long term restructuring options, culminating in exits of post reorganization debt and equity. The economics of non performing loan sales are also evaluated.

Day 3 focuses on portfolio issues in commercial lending, namely an evaluation of returns in an economic value added framework, risk limit setting, other risk management tools (including securitisation) and governance.

¿Esta formación es para mí?

Officials responsible for handling problem loans at the bank
Credit analysts and Credit risk managers
Portfolio managers
Head of problem loan restructuring
Head of loan desk
Accountants
Head of distressed debt trading
Central bankers and regulators

Requisitos: A basic knowledge of finance and credit.

Instalaciones y fechas

Dónde se imparte y en qué fechas

Inicio Ubicación
06 marzo 2017
London
34 Curlew Street, se12nd, London, Inglaterra
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¿Qué aprendes en este curso?

Retail
Risk
Accounts
Best Practice
Risk Management
Portfolio Management
Securitisation
Cash Flow
Financial Modelling
Transactions
IFRS
Options
Loans
Credit
Testing
Quality
Economics
Sales
Global
Financial
Industry
Credit Risk Management
IT risk
Quality Training
Equity
Financial Training
Sales Training
Stress Testing
Commercial Loan
Financial statement
Cash flow analysis
Risk Governance
Syndication
Credit Analysis

Temario

Day One

Commercial Loans – Products, Credit Analysis And Structuring
Introduction
  • Course overview
Commercial Loan Products
  • Term loans
  • Revolving credit facilities
  • PIK and PIK toggle facilities
  • Accounts receivable / borrowing base facilities
Credit Analysis of Commercial Loans
  • Components of credit analysis – business, financial and loan assessments
  • Business assessment – macroeconomic sensitivity; industry structure and risks; firm specific risks; management and ownership; SWOT analysis
  • Financial assessment – financial statement analysis; cash flow analysis; key credit metrics
Case Study 1: A banker’s cash flow template and different measures of cash flow – New Look Retail Group Limited (UK clothing retailer)
  • Loan assessment – corporate structure; security package; guarantees; capital structure; covenants; loan agreement documentation; intercreditor agreement
Case Study 2: Credit analysis – New Look Retail Group Limited (UK clothing retailer)

Workshop 1: Credit analysis – Seadrill Limited (offshore deepwater rig company)

Financial Modelling
  • Financial modelling for commercial bankers – best practice model layout, use of Excel techniques (labelling, vlookups, sumifs, index matching, sensitivity analysis) and desired outputs
  • Testing covenant compliance
Case Study 3: Financial modelling – New Look Retail Group Limited (UK clothing retailer)

Stress Testing
  • What does it take to “break” the company?
  • Stress testing – calibration and implementation; stressed credit metrics; stressed covenant compliance; stressed liquidity position
  • Altman Z Score
  • Deriving probability of default from expected default frequency in Merton/Merton variation models
Case Study 4: Stress testing – New Look Retail Group Limited (UK clothing retailer)

Case Study 5: Financial modelling and stress testing of cyclical businesses – Freeport McMoRan Inc (US metals, mining and energy group)

Workshop 2: Financial modelling and stress testing Seadrill Limited (offshore deepwater rig company)

Credit Risk Mitigation In Commercial Loans
  • Fixed and floating charges
  • Security packages – share collateral, deposits, property/land, inventory, accounts receivable, intellectual property
  • Collateral risks – perfecting security; substantive consolidation; voidable preferences; bankruptcy stays; security release clauses
  • Realizing security – triggers for enforcement; claims priority from enforcement proceeds
Case Study 6: Security package analysis – Garfunkelux 3 Holdco SA (UK and German consumer NPL debt purchaser and collector)

Day Two

Commercial Loan Distress and Workouts
Entry Into Distress
  • Causes of distress
  • Distress early warning signals
Case Study 7: Distress early warning signals in Norske Skogindustrier ASA (Global newsprint and magazine paper producer)
  • Forensic accounting of dubious quality cash flow
Case Study 8: Cash flow quality at Codere SA (international gaming company)
  • Loan classification methodology and changes under IFRS 9 internationally and FASB’s Current Expected Credit Loss (CECL) standard
  • Internal reporting and monitoring of problem credits
Case Study 9: Asset quality framework at Barclays Plc

Commercial Lender Preparation For Distress
  • Can the loan remain performing or will restructuring or liquidation be required?
  • Use of financial modelling and stress testing
  • Strategic options – assessing scope for asset sales; secured financing; sale and leaseback transactions; and equity raising
Case Study 10: Assessing likelihood of impairment at Truvo (European directories business)
  • Lender risks with pre bankruptcy credit risk mitigation measures
Workshop 3: Assessing likelihood of impairment at Countrywide (UK estate agent)

Loan Workouts
Short Term Options – Reduce Free Cash Flow Burn
  • Overdraft facility / borrowing base facility / accounts receivable facility
  • Trust and warehouse receipt and other inventory secured facilities
  • Business restructuring
  • Asset sale options
Case Study 11: Fighting insolvency and extending liquidity run way at Norske Skogindustrier ASA (Global newsprint and magazine paper producer)

Long Term Restructuring Options
  • Approaches – (1) Out of court restructurings – voluntary and coercive exchanges, holdout problems; (2) In court restructurings – pre packaged or pre negotiated vs post petition, process
  • Key elements of bankruptcy law – UK, US, Europe
  • How to estimate the sustainable level of debt for the business around which the restructuring will be designed
  • Business valuation – EBITDA multiple and DCF approaches
  • Estimating recovery value
  • Complexities arising in group structures spanning several legal jurisdictions
  • Tactics in loan workouts
Case Study 12: Evaluating long term restructuring options at Norske Skogindustrier ASA (Global newsprint and magazine paper producer)

Selling Non Performing Loans
  • Evaluation of whether to sell NPLs or attempt restructuring
  • Buyer base for NPLs and their investment considerations
  • Managing the NPL sale process
Case Study 13: Economics of selling an NPL portfolio – Lloyds Banking Group Plc

Exiting Post Reorganization Debt And Equity
  • Bank to bond transactions
  • Selling post reorganization equity – IPOs, trade sales, private equity sales
Case Study 14: Countrywide (UK estate agent)

Workshop 4: Developing restructuring plans for Isolux Corsan (energy, construction and infrastructure company)

Day Three

Managing A Commercial Loan Portfolio
Commercial Loan Economics – Grading, Provisioning, Pricing And Regulatory Capital
  • Developing an internal rating scale
Case Study 15: Internal rating scale at Barclays Plc
  • Modelling Basel 3 Advanced and Foundation Internal Ratings Based (IRB) credit parameters – probability of default (PD), loss given default (PD), exposure at default (EAD)
  • Risk weighted asset exposure and regulatory capital requirements
  • Loan loss provisioning under IFRS 9 and FASB CECL as compared to prior accounting standards
Case Study 16: How IFRS 9 and CECL impact commercial loan economics
  • Return on Risk Adjusted Capital (RORAC) based loan pricing
  • Economic Value Added (EVA) based loan pricing
  • Borrower hedges for interest rate and FX risk on loans – XVA implications and incorporation in pricing
Case Study 17: EVA based loan pricing illustrated
  • Credit Portfolio Management
  • Concentration measurements – industry; single borrower/borrower group; country/region/location; foreign currency; collateral; maturity; funding; correlation
  • Credit limit setting – industry; single borrower/borrower group; country/region
  • Credit limit setting for counterparty exposure on OTC derivatives and securities financing transactions – use of potential future exposure modelling
  • Diversification measurement
  • Syndication of loans
  • Securitisation
  • Use of credit derivatives
Workshop 5: Pricing a variety of commercial loans in an EVA framework

Securitisation
  • Mechanics of securitisation
  • SME securitisations – structuring considerations and economics
  • NPL securitisations – structuring considerations and economics
Workshop 6: Structuring an SME securitisation for a hypothetical in scope commercial loan book

Risk Governance
  • Credit risk management objectives, credit risk culture and appetite
  • Credit risk management organization
  • Credit risk management process
Case Study 18: The case for collections outsourcing in the SME space to specialist credit management services firms. Banco Sabadell SA platform carve out to Lindorff