When is global cash flow needed? What if a business can qualify for a loan with their cash flow alone? Do additional businesses owned by one or more of the guarantors have to be reviewed? Examiners expect to see a consistently applied global debt service coverage methodology, and your lending staff must be able to provide clear and consistent answers when asked. For example, who should be included? Do you use the EBITDA or UCA method, and why? What level of financial detail is needed for related entities? What numbers are used: operating profit, net profit, or another number? How is debt repayment determined without complete debt schedules from each entity? This presentation will address key decisions and processes in global cash flow calculations.
- Why you should perform a global cash flow
- Key decisions
- Determining whom to include in a global cash flow analysis
- Level of detailed financial information needed for operating entities and guarantors
- Establishing when to perform in-depth versus simplified analysis
- Three methods for computing debt service coverage ratio
- How to calculate global debt service coverage rates (DSCR)
- Depreciation and amortization expense – when NOT to add back
- How to handle net operating loss carry-forwards and carry-backs
- CapEx and DSCR calculation
- Utilizing 1040 Schedule E Page Two information
- Stressing global debt service coverage
- Contingency cash flow illustration – dealing with partial ownership interests
- Impact from change in level of interest rates and sales
- Guarantor support analysis – assessing the strengths/limitations of guarantors
- Employee training log
- Quiz you can administer to measure staff learning and a separate answer key
WHO SHOULD ATTEND?
This insightful program will benefit beginning and intermediate-level credit personnel, including credit analysts, commercial loan underwriters, general loan officers, loan review personnel, loan committee members, and credit-risk managers.
ABOUT THE PRESENTER – S. Wayne Linder, Young & Associates, Inc.
A thirty-year banking veteran, Wayne Linder was formerly the CEO of a community bank. As a Senior Consultant with Young & Associates, Wayne works as a lending and management consultant. He assists financial institutions under regulatory enforcement agreements, develops and implements written lending policies, and develops educational material for in-house lending training. Wayne is a popular seminar speaker with both national and international experience.
Originally recorded on April 25, 2018.
Recorded webinar link is available until October 31, 2018.
Free Digital Copy included with purchase to download and view beyond link expiration date.
Price includes sales tax.