Thursday, January 23, 2023
2:00 – 3:00 pm (Eastern Time)
1:00 – 2:00 pm (Central Time)
12:00 – 1:00 pm (Mountain Time)
11:00 – 12:00 pm (Pacific Time)
How the 5 C’s (capacity, conditions, capital, collateral, and character) are used to evaluate borrowers.
Bankers have relied on the 5 C’s of credit—capacity, conditions, collateral, capital, and character for many years, but what do these terms really mean, and how do lenders use them to determine whether a potential borrower is creditworthy? Once you understand what and how, this simple credit model is simple and easy to use. Attend the session to C the big picture for credit.
Areas to be discussed include:
1-capacity measured by ability to repay from cash flow with emphasis on global ash flow
2-conditions evaluated in terms of how borrowing needs change over the business cycle and what makes some industries more vulnerable to downturns than others, especially during this pandemic
3-collateral analyzed in terms of relative liquidation values based on liquidity, marketability, perishability, security, and other factors
4-capacity considered in terms of the borrower’s equity cushion and the degree of relative leverage possible
5-character assessed in terms of willingness to repay as evidenced by payment history as well as tips for fraud prevention
What can be learned from this session?
- The first four C’s—capacity, conditions, collateral, and character-- evaluate a borrower’s ability to repay, but character forces the lender to examine closely the borrower’s willingness to repay.
- Learn how to employ the first four C’s to analyze repayment ability
- Learn how to use the fifth C—character—to judge a borrower’s willingness to repay
Who can benefit from attending this session?
- Credit Analysts
- Credit Managers
- Credit Risk Managers
- Risk Managers
- Enterprise Risk Managers
- Chief Credit Officers
- Senior Lenders
- Senior Lending Officer
- Bank Director
- Chief Executive Officer
- Board Chairman
1.0 CPE Credits & 1.2 AAP Credits