Credit Analysis Course

Lesson 1 • Participants in the Credit Market

Identifies lenders, borrowers, guarantors, and intermediaries. Clarifies each party's role and how relationships affect credit decisions.

Lesson 2 • Types of Credit Facilities

Surveys revolving, installment, trade, and structured credit products. Connects product characteristics to distinct evaluation requirements.

Lesson 3 • The Credit Lifecycle

Traces a credit facility from origination through repayment or default. Provides context for where evaluation fits within the full lending process.

Lesson 1 • Analysing the Income Statement

Covers revenue recognition, cost structure, and profit margins. Links earnings quality and consistency to debt-service capacity.

Lesson 2 • Adjustments and Normalisation

Teaches how to restate financials for one-time items and accounting choices. Produces comparable, reliable figures for ratio analysis.

Lesson 3 • Cash Flow Statement Interpretation

Distinguishes operating, investing, and financing cash flows. Demonstrates why cash generation is the primary repayment source.

Lesson 4 • Understanding the Balance Sheet

Explains assets, liabilities, and equity structure. Connects balance sheet composition to a borrower's solvency and net worth assessment.

Lesson 1 • Gearing and Solvency Ratios

Quantifies debt load relative to equity and assets. Connects gearing levels to long-term repayment capacity and financial resilience.

Lesson 2 • Trend Analysis and Benchmarking

Applies multi-period ratio comparison and peer benchmarking. Transforms static ratios into dynamic signals of improving or deteriorating credit.

Lesson 3 • Coverage and Debt-Service Ratios

Measures ability to service interest and principal from earnings and cash flow. Directly links to loan structuring and covenant setting.

Lesson 4 • Liquidity Ratios

Covers current, quick, and cash ratios to measure short-term obligations coverage. Establishes the link between liquidity and near-term default risk.

Lesson 1 • Integrating Qualitative and Quantitative Findings

Combines financial ratios with qualitative factors into a unified credit view. Prepares students to resolve conflicts between quantitative and qualitative signals.

Lesson 2 • Borrower Character and Credit History

Examines payment history, legal background, and reputational factors. Distinguishes willingness to repay from ability to repay.

Lesson 3 • Business and Industry Analysis

Assesses competitive position, industry dynamics, and market risk. Contextualises financial results within the borrower's operating environment.

Lesson 4 • The Five Cs of Credit

Introduces character, capacity, capital, collateral, and conditions as the core qualitative framework. Anchors all subsequent qualitative analysis.

Lesson 1 • Collateral Valuation Methods

Covers market, income, and cost approaches to valuing collateral assets. Enables analysts to critically evaluate third-party appraisals.

Lesson 2 • Perfecting and Monitoring Security Interests

Explains lien perfection, priority, and ongoing collateral monitoring obligations. Ensures analysts understand post-closing security management.

Lesson 3 • Loan-to-Value and Advance Rates

Calculates loan-to-value ratios and applies advance rate haircuts by asset type. Connects collateral coverage to loan sizing and risk appetite.

Lesson 4 • Types of Collateral and Their Characteristics

Surveys real estate, equipment, receivables, inventory, and financial assets as collateral. Links asset characteristics to liquidation value and lender risk.

Lesson 1 • Probability of Default and Loss Metrics

Defines probability of default, loss given default, and exposure at default. Links these metrics to expected loss calculations and pricing.

Lesson 2 • Principles of Credit Risk Rating

Defines risk rating objectives, scale design, and through-the-cycle vs. point-in-time approaches. Establishes the conceptual basis for all rating work.

Lesson 3 • Rating Override and Governance

Addresses analyst override procedures, documentation standards, and rating committee governance. Maintains rating integrity and audit-trail requirements.

Lesson 4 • Scorecard Development and Application

Covers factor selection, weighting, and scorecard calibration for borrower segments. Connects scorecard outputs to credit approval thresholds.

Lesson 1 • Principles of Sound Loan Structuring

Links loan purpose, repayment source, and tenor to appropriate structure. Prevents mismatches between facility design and borrower cash flow cycles.

Lesson 2 • Financial Covenants and Conditions

Covers maintenance, incurrence, and reporting covenants as ongoing risk controls. Explains how covenants provide early warning of borrower deterioration.

Lesson 3 • Credit Approval Processes and Authorities

Maps delegated authority levels, credit committee structures, and approval workflows. Ensures analysts understand how decisions are escalated and documented.

Lesson 4 • Term Sheet Preparation

Guides construction of a term sheet covering amount, pricing, security, and conditions. Translates credit analysis findings into actionable lending terms.

Lesson 1 • Credit Monitoring Frameworks

Establishes periodic review cycles, trigger-based reviews, and watchlist criteria. Connects monitoring intensity to risk grade and facility size.

Lesson 2 • Remediation, Workout, and Recovery

Outlines restructuring options, workout strategies, and recovery maximisation techniques. Prepares analysts to manage distressed credits through resolution.

Lesson 3 • Portfolio Concentration and Diversification

Measures sector, geographic, and single-borrower concentration risk. Applies diversification principles to reduce portfolio-level credit losses.

Lesson 4 • Loan Classification and Provisioning

Covers pass, watch, substandard, doubtful, and loss classification categories. Links classification to provisioning requirements and income statement impact.