Writing an Effective Credit Memorandum

After a detailed credit analysis of a loan request has been performed, it's now time to communicate your findings in writing. Credit memoranda are a primary means of communication within the banking industry. When writing effective credit memoranda, it's not what you say that commands attention, but how you say it. Credit memoranda serve three functions: 1) they provide information on the condition and status of a customer relationship; 2) they provide a record of thoughts and actions; and 3) they support or recommend action.

This course teaches skills required to write an effective credit memorandum. Learn to emphasize important factors and trends without stating the obvious. In short, your credit memoranda should present relevant, material facts, along with your thoughts and opinions. Remember, anything you write in a credit memorandum will become public record if you find yourself in court with a borrower.

Covered Topics:

  • Balance Sheet analysis
  • Income Statement analysis
  • Cash Flow analysis
  • Calculating and interpreting financial ratios and cash flow
  • Using analysis to determine the Financial Impact of changes in financial factors
  • Questions to raise with the customer after the credit analysis is completed
  • Outline of relevant factors to include in a credit memorandum
  • How to report your finding efficiently and effectively in credit memoranda
  • Apply the concepts to a study case
We'll also explore underwriting and reporting on Commercial Real Estate, Construction Loans, Acquisition and Development Loans and Multi-Family Unit loans. Samples of proven credit memos will be examined to insure bankers are covering the areas required by banking regulators. Learn to:
  1. Strengthen your understanding of credit analysis
  2. Clearly describe the Financial Impact of changes in financial factors, and not just report on what changed
  3. Interpret financial trends and financial ratios
  4. Write succinct and focused credit memoranda
  5. Meet with management armed with relevant questions and issues to be addressed
  6. Feel more confident in defending a recommended course of action based on relevant facts and not instinct

Who Should Attend?

  • Commercial Loan Officers
  • Consumer Loan Officers
  • Credit Analysts
  • Loan Review Personnel
  • Compliance Officers
  • Internal Auditors
  • Branch Managers

Participant should have some experience or prior class work in analyzing financial statements and/or credit analysis.


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   OnDemand Recording Only - $295   
   CD-ROM and Hardcopy Handouts - $345