SME Loan Structuring Training Course

Participants can interpret borrower financial statements and identify issues affecting lending decisions.

• Income statement normalization for owner remuneration, one-offs and related-party charges
• Balance sheet recasting to distinguish operating debt from shareholder funding
• Trend analysis using common-size statements and multi-period ratio movements
• Liquidity, gearing and profitability ratios interpreted against peer benchmarks
• Detecting aggressive revenue recognition, expense deferral and unsupported asset values
• Management accounts reconciled to audited statements, tax returns and bank flows

Participants can forecast SME cash flow and test capacity to meet proposed debt obligations.

• Indirect cash flow reconstruction from profit, working capital and capital expenditure
• 13-week rolling cash forecast built from receipts, payroll and supplier data
• Seasonality analysis linking sales cycles, inventory purchases and collection periods
• Debt service capacity measured through DSCR, ICR and free cash flow
• Stress tests for volume declines, margin compression, delays and rate rises
• Forecast assumptions challenged through sensitivity tables and break-even analysis

Participants can select and size working capital facilities that match operating cash cycles.

• Working capital cycle calculated from days sales, inventory and payables
• Overdraft limits sized against peak cumulative cash deficits and seasonality
• Receivables finance eligibility assessed through debtor ageing, dilution and concentration
• Inventory facilities matched to stock turnover, obsolescence and control arrangements
• Borrowing-base formulae defined with advance rates, reserves and reporting triggers
• Trade finance structures selected for purchase orders, imports and confirmed sales

Participants can structure term lending around asset life, cash generation and repayment risk.

• Term loan purpose matched to asset life and repayment source
• Amortisation schedules compared: straight-line, sculpted, bullet and seasonal profiles
• Grace periods assessed against construction, commissioning and cash-generation timelines
• Capital expenditure budgets tested for contingencies, overruns and sponsor contributions
• Acquisition finance assessed through purchase price, goodwill and integration assumptions
• Refinancing proposals tested against maturity walls, prepayment costs and repayment capacity

Participants can design security arrangements that support recovery without replacing repayment analysis.

• Collateral value distinguished from primary repayment capacity and secondary recovery
• Security packages designed using guarantees, charges, assignments and pledges
• Valuation instructions specify basis, marketability, inspection and revaluation frequency
• Personal guarantees assessed for enforceability, net worth and independent advice
• Ranking arrangements address prior charges, intercreditor rights and negative pledges
• Perfection steps cover registration, notices, possession and legal opinion requirements

Participants can price SME facilities and set covenants that provide meaningful risk control.

• Risk-based pricing combines funding cost, operating cost, capital and expected loss
• Risk-adjusted return measured using RAROC and economic capital assumptions
• Covenant packages align with cash generation, leverage and collateral risk
• Financial covenant definitions prevent EBITDA adjustments and accounting manipulation
• Information covenants specify reporting frequency, certificates and management access
• Early-warning triggers connect covenant headroom, arrears and adverse borrower events

Participants can identify and document the contractual terms required for controlled loan drawdown.

• Facility letters state purpose, amount, tenor, pricing and repayment terms
• Conditions precedent verified before drawdown, including authority and insurance evidence
• Representations and warranties tailored to ownership, compliance and financial information
• Events of default drafted around payment, covenant, insolvency and cross-default risk
• Undertakings distinguish affirmative, negative and financial obligations clearly
• Documentation checklists coordinate legal counsel, relationship teams and operations

Participants can prepare approval submissions and control the transition from approval to drawdown.

• Credit memoranda present borrower, structure, risks, mitigants and recommendation
• Risk ratings assigned using obligor assessment, facility loss severity and policy scales
• Approval conditions translated into closing actions, owners and completion evidence
• Exception requests document policy variance, rationale, compensating controls and authority
• Drawdown controls confirm signed documents, security perfection and condition satisfaction
• Post-closing files retain approvals, legal opinions, valuations and monitoring dates

Participants can monitor SME facilities, identify deterioration and plan proportionate remedial action.

• Loan review cadence matched to risk grade, facility type and information quality
• Variance analysis compares actual performance, covenants and forecasts against approval case
• Watchlist criteria identify persistent excesses, deteriorating cash flow and governance concerns
• Remedial options assess restructuring, additional security, sponsor support and exit plans
• IFRS 9 staging indicators linked to significant increase in credit risk
• Individual application plans prioritise documentation and monitoring improvements after return