ROBUST CREDIT ANALYSIS IN EXCEL B

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Berenice Douglas
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1 ROBUST CREDIT ANALYSIS IN EXCEL B

2 F1F9 financial modelling training is trusted by the world s leading financial companies. We train our clients to build robust models that allow them to collaborate effectively and make better decisions. We run public courses in cities including New York, London, Antwerp, Rotterdam and Toronto. All of our courses can be run in-house, and an increasing number are available online. Course participants continue to learn from us long after classroom sessions have ended. They are able to revisit course material through online videos, printed course notes and additional case studies. Many use our support forums to get answers to their specific questions from our dedicated team of FAST financial modellers. We offer specialised courses in a number of sectors, delivered by industry experts. Public In-house Online F1F9 is accredited by the FAST Standard Organisation Ltd to deliver FAST training courses. See: for details

We run public courses in cities including New York, London, Antwerp, Rotterdam and Toronto. All of our courses can be run in-house, and an increasing number are available online.

3 The value added for me was the focus on the link between business reality and what we had modelled in Excel... Participant, Credit Agricole, December 2013

4 ROBUST CREDIT ANALYSIS IN EXCEL A two day intensive skills development course for credit practitioners: Applied learning: Maximise your skills by learning to use powerful credit analysis tools on existing financial models Progressive skills development: Prepare with our custom pre-course modules, then work with a typical financial model in class to develop credit decision making skills Acquire industry best practice: Learn model design and build skills from an instructor with many years experience in banking and credit analysis Gain efficiency: Deepen your knowledge of building models that can be shared and easily understood by others by using the FAST Standard Benefit from ongoing support after the course: Take advantage of unlimited online post-course support

skills Acquire industry best practice: Learn model design and build skills from an instructor with many years experience in banking and credit analysis Gain efficiency: Deepen your knowledge

5 ROBUST CREDIT ANALYSIS IN EXCEL/ WHAT KIND OF COURSE? Outline This course will teach you design and build techniques for credit segments of a financial model. You will then work with a live financial model to make effective credit decisions. You ll start with an existing financial model including integrated financial statements, historic numbers and forecasts. After testing the robustness of Cash Flow Available for Debt Service and Repayment via Excel analysis of key identified business, industry and operational risks, you will model-build for sensitivity and scenario analysis using industry best practice and the FAST Standard. You will then focus on the financing proposition, including using the model to draw conclusions on the appropriateness of the overall interest bearing debt amount, facility type, maturity, structure and returns available to the lenders for the risks being assumed. The modelling of an appropriate, relevant and effective financial covenant package is also covered.

You ll start with an existing financial model including integrated financial statements, historic numbers and forecasts.

6 ROBUST CREDIT ANALYSIS IN EXCEL/ WHAT KIND OF COURSE? Key Considerations has the client asked for sufficient funding? is the senior debt appropriately sized? is there a requirement for subordinated debt financing? is the company positioned to generate returns in excess of costs? Key Lessons The course will teach you how to build the credit aspects of the model including: sensitivity and scenario analysis; senior and subordinated debt-sizing; analysis of returns versus costs, and credit reports (including graphs). I found the link between the effective business reality and the spreadsheet s options to be very valuable.

Key Lessons The course will teach you how to build the credit aspects of the model including: sensitivity and scenario analysis; senior and subordinated

7 ROBUST CREDIT ANALYSIS IN EXCEL/ WHO IS IT FOR? Target Audience The course is designed for credit practitioners who wish to maximise their skills by learning how powerful credit analysis tools can be applied to existing financial models. It is particularly appropriate for credit officers who need to work with financial models built by others (including clients or colleagues) so that the models are fit for purpose and credit decisions may be made. Teaching Approach This is a highly practical and applied course. You will begin the course with an existing financial model including integrated financial statements, historic numbers and forecasts. Following the course instructor, you will build credit aspects of the model including: sensitivity and scenario analysis; senior and subordinated debt sizing; and analysis of returns versus costs. You will then learn to use the model for credit decision-making purposes.

It is particularly appropriate for credit officers who need to work with financial models built by others (including clients or colleagues) so that the models are fit for purpose and credit decisions

8 ROBUST CREDIT ANALYSIS IN EXCEL/ BEFORE & AFTER Pre-work Participants are expected to have completed the pre-work specifically tailored for credit practitioners using client and colleague models. The pre-work is designed to develop the modelling skills needed to work with and adapt client and colleague models to answer core credit questions. The pre-work also covers the basics of the FAST Standard for financial modelling. As soon as we receive your booking we will send you an invitation to our exclusive online classroom where all course material will be available as well as joining details and course files. Post course support Your course fee includes unlimited access to the F1F9 Academy. This includes access to video tutorials on the topics that we teach in class, plus additional topics that we may not be able to cover within the classroom sessions. All post-course questions are answered within 24 hours, usually much quicker. In short, we don t just give you two days of tuition and leave you to it we are by your side as you put your new learning into practice.

The pre-work also covers the basics of the FAST Standard for financial modelling.

9 ROBUST CREDIT ANALYSIS IN EXCEL/ CLASS SESSIONS Day 1: includes specific sessions focused on: Conceptual Modelling: The purpose of a credit model and how the purpose influences credit model design & construction. Analysis of business, industry and operational risks in Excel. Use of sensitivity and scenario analysis to determine the robustness of cash flow to changes in key variables. Use of scenario analysis to produce base-case, best-case, and worst-case scenarios. Day 2 You will use the financial model to develop your understanding of how cash flows are generated and used under the business strategy. There will also be time to explore how cash flow dynamics influence the assessment of an optimal debt structure. You will: Determine senior debt capacity based on: Discounted value of forecast future cash flows; and Discounted value of sustainable future cash flows. Identify the requirement for working capital financing, and model this via a revolving credit facility. Assess the requirement for subordinated debt financing and size the subordinated debt element of the financing using relevant market-based techniques. Model the cash flow waterfall for revolving credit, senior debt and subordinated debt interest payments and principal repayments. Design and model covenants in Excel and learn to set model alerts for breaches in covenants. Generate summary data and charts throughout the course and in the final session produce a credit report using data generated from the model.

Use of scenario analysis to produce base-case, best-case, and worst-case scenarios.

10 ROBUST CREDIT ANALYSIS IN EXCEL/ REQUIREMENTS Tools & Setup Participants should have a basic understanding of Excel and will need to complete a short online pre-course. They will also need to bring a laptop with them, ideally one that they are familiar with. It should have a Microsoft Windows operating system with Excel loaded (Excel 2003 or later) and Analysis ToolPak available. Laptops may be rented from F1F9 for an additional charge. The instructors made this training very interesting Modeling the business value and key cash flow drivers was very useful.

It should have a Microsoft Windows operating system with Excel loaded (Excel 2003 or later) and Analysis ToolPak available.

11 FIND OUT MORE ABOUT OUR FINANCIAL MODELLING TRAINING/ INFO.F1F9.COM/31-DAY-FINANCIAL-MODELLING-COURSE INFO.F1F9.COM/WHAT-OUR-CLIENTS-SAY BLOG.F1F9.COM/ SOME OF OUR SOME REGULAR OF OUR TRAINING CLIENTS: REGULAR TRAINING CLIENTS: BANK OF TOKYO MITSUBISHI

12 F1F9 teaches the best financial modelling courses available on the market today, training our clients to build better models themselves through courses delivered worldwide. We also build and maintain financial models used by leading corporates, advisors, banks and funds. Our team of over 40 modellers constantly use the techniques we teach on our courses. Financial modelling is our core business. It s what we do. To discuss how we can meet your training needs, call Alex Arnold on or alex.arnold@f1f9.com Bedford Row, London WC1R 4JS

Our team of over 40 modellers constantly use the techniques we teach on our courses. Financial modelling is our core business. It s what we do.

FAST CORPORATE FINANCE MODELLING B WWW.F1F9.COM

FAST CORPORATE FINANCE MODELLING B WWW.F1F9.COM F1F9 financial modelling training is trusted by the world's leading financial companies. We train our clients to build robust models that allow them to collaborate