Continuing one of the MD2MD’s meeting themes of “how businesses are viewed by external financial and commercial professionals”, we were delighted to welcome Steve Bateman, Senior Business Development Manager of The Co-operative Bank Corporate Banking to talk to the group of business owners and managing directors about ‘how a banker might assess a lending proposition’.
Steve started by introducing “CAMPARI & ICE” to the members; an acronym the bank use when assessing applications.
He explained in some detail how he might go about considering the business risks; not only looking at a company’s financial statements, but also looking at its market position and management. A bank will also consider the industry as a whole; its growth, decline, market share and the clients strategic positioning within that.
When assessing financial statements, amongst others the focus will be on revenues, costs and profits for margin trends, cash-flow for any pressure signs, assets and their potential value and any current debts or liabilities.
Steve emphasised that there is no single measure to show whether a company is a good credit risk or not. It is important for lenders to consider non-financial traits as much as financials and that common sense questioning and reasoning is essential; as is customer transparency.
He did, however, point out that presentation can add or detract from a borrowing request and as a result some companies use professional advisors.
The group came away from the meeting with a greater understanding of banks and what they look for, and their basic credit assessments.
Written by Bob Bradley, founder of MD2MD.
At MD2MD we understand that our members and their businesses have varied needs. We have four different membership plans to choose from, each offering a unique blend of our numerous events and services.
At MD2MD we understand that different leaders and different businesses have varied needs. We have four different membership plans for you to choose from. Each membership option offers you a different blend of our varied events and services.
Information about the events we offer as part of our membership, both current and historical, can be found on our events page. This includes our regular, international, world class speaker workshops and webinars.
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If MD2MD sounds right for you and you match our criteria, then we would love to offer you a place at our demonstration meeting – designed for us to demonstrate the power of peer groups and for you to experience first hand how the meetings work.