Warning Signs and Lesson Learned
Developing knowledge and skills to identify heightened risk of credit deterioration across the bank’s portfolio of clients.
Drawing upon lessons learned from recent credit crises, we develop participants’ ability to conduct a rigorous and consistent approach to identifying early signs of credit deterioration. We demonstrate how early intervention and the implementation of effective responses to signs of deterioration can help reduce the bank’s exposure, enhance recovery rates, and ultimately limit loss to the bank.
On completion of the course, participants will have the knowledge and skills to:
- Use a structured approach to recognise early signals of credit deterioration
- Recognise the impact of changing sector fundamentals and market conditions on the risk profiles of different companies
- Identify vulnerabilities in a client’s business model, balance sheet and performance which could result in distress and potential loss to the bank
- Distinguish sustainable debt levels for companies operating in various sectors / markets and recognize when a company is over reliant on debt funding
- Draw upon lessons learned to evaluate management competencies and corporate governance
- Appreciate the key structural features of a company’s financial obligations and their potential effect on the company’s financial flexibility, debt servicing ability, cash flows and credit quality/rating
- Evaluate alternative actions to reduce risk / exposure and various solutions to stabilise the business and minimise future problems
