Credit Analysis | Process | 5 C's of Credit Analysis | Ratios

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In this video on Credit Analysis, we look at Credit Analysis from Beginner’s point of view.

𝐖𝐡𝐚𝐭 𝐢𝐬 𝐂𝐫𝐞𝐝𝐢𝐭 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬?
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Credit analysis is a process of drawing conclusions from available data (both quantitative and qualitative) regarding the credit – worthiness of an entity, and making recommendations regarding the perceived needs, and risks.

𝐂𝐫𝐞𝐝𝐢𝐭 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬 𝐏𝐫𝐨𝐜𝐞𝐬𝐬
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1. Proposal
2. Inspection
3. Financial security
4. Market Review
5. Presentation of Proposal
6. Sanction for assessment
7. Data Collection
8. Analysis of various parameters
9. Credit Rating
10. Presentation for sanction
11. Terms & Condition Established
12. Proposal Approved

𝐓𝐡𝐞 𝟓 𝐂'𝐬 𝐨𝐟 𝐂𝐫𝐞𝐝𝐢𝐭 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬
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1. Character
2. Capacity
3. Capital
4. Collateral (or guarantees)
5. Conditions

𝐂𝐫𝐞𝐝𝐢𝐭 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬 𝐑𝐚𝐭𝐢𝐨𝐬
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1. Liquidity ratios
2. Solvability ratios
3. Solvency ratios
4. Profitability ratios
5. Efficiency ratios
6. Cash flow and projected cash flow analysis
7. Collateral analysis
8. SWOT analysis

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1. Proposal 2.inspection 3. Financial scrutiny 4. Market review 5. Presentation of proposal 6. Sanction for assessment 7. Data collection 8. Analyses of various parameters 9. Credit rating 10. Presentation for sanction 11. Terms and conditions established 12. Proposal approved.
1. Character: trust? Experience?
2. Capacity. Ability to pay loan back from cash flow in future.
3. Capital. Borrowers skill of assets. If business faults, it creates trust.
4. Collateral. Fe from friends or family. Mitigate initial risk.
5. Condition. Working capital, long term investment, inventory etc.

FleurOlivia
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Awesome ! explained each and every term in detail.

baonavalta
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Well explained & at a very good speed (pace)

mohammedmuzibur
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What is this strange accent? Sounds like Scottish or Welsh...

danielstoykov