Credit Decision-making Criteria & Bad Debt Management

Introduction:

In the rapidly changing world of finance and business, credit decision-making represents one of the most significant challenges facing financial institutions and banks. A single credit decision can have a significant impact on an institution’s financial sustainability. Furthermore, managing distressed debt is a critical task to ensure continued liquidity and mitigate risk.

This training program aims to provide participants with the knowledge and skills necessary to understand and analyze credit decision-making criteria and acquire innovative strategies for effectively managing distressed debt. Through a combination of interactive lectures and practical studies, participants will have the opportunity to develop their risk analysis skills, assess creditworthiness, and develop plans to address distressed debt in line with global best practices.

Overall Objectives:

• Enhance participants’ understanding of credit decision-making criteria and creditworthiness analysis.
• Develop their ability to manage distressed debts in a systematic and effective manner.
• Empower participants to apply global best practices in reducing credit risk.
• Develop skills in analyzing financial data and making informed strategic decisions.

Detailed Objectives:

• Identify the key stages of the credit decision-making process, including information gathering and risk analysis.
• Learn how to assess customers’ creditworthiness using advanced indicators and tools.
• Study practical cases of dealing with distressed debts and how to negotiate with customers for rescheduling or settlement.
• Understand the legal and regulatory aspects related to managing distressed loans.
• Acquire effective strategies for dealing with distressed debts, including recovering amounts due and maintaining customer relationships.
• Apply practical models and modern techniques used to predict future financial risks.

Program Audiences:

• Employees in credit departments at banks and financial institutions
• Loan officers and creditworthiness analysis experts
• Collection and distressed debt management teams
• Employees in financial management, internal audit, and risk management at banks and financial institutions
• Credit managers at banks
• Managers interested in investment management and dealing with financial distress
• Department managers at banks

Program Topics:

Day 1: Basic Concepts and Financial Statement Management

• Introduction to Financial Statements: Balance Sheet and Income Statement
• Fundamentals of Foreign Trade Finance (Documentary Credits and Bills of Collection)
• Bank Guarantees

Day 2: Financial Analysis and Credit Management

• Financial Analysis and Cash Flow Analysis
• Financial Analysis as a Credit Decision-Making Tool
• Asset Conversion Cycle: Assessing Capability and Associated Risks

Day 3: Risk Management and Credit Policies

• Defining and Measuring the Acceptable Level of Risk
• Types of Risk (e.g., Inventory, Collection, Exchange Rate, Political, Legal)
• Credit Policies and Credit Management

Day 4: Strategies for Dealing with Default (Credit) Risk and Factors for Selecting Remedial Strategies

• Strategies for Dealing with Distressed Debts (e.g., Foreclosure, Liquidation, and Renegotiation)
• Debt Monitoring and Evaluation and Follow-up Objectives

Day 5: Practical Case Studies and Finance Management

• Basel Committee Decisions and Risk Management
• Medium-Term Financing and Investment Costs
• Preparing estimated financial statements and various practical cases for risk analysis

Practical exercises and applied cases