Bad Loans – Early Warning Signs & Effective Actions
The emergence of potential problem loans within a lending portfolio is an inevitable risk associated with the lending activity undertaken by any bank. However, when the credit quality of lending assets deteriorates to the point where they are “Non-Performing”, the consequences for a lender’s capital base and reputation can be severe.
Through the extensive use of practical exercises and case studies, this 2 day workshop conducted by an experienced City practitioner, will introduce delegates to the common causes and impacts of credit deterioration. It will then focus in detail on how to identify and respond to the early warning signs of an emerging problem in relation to an individual credit exposure; providing high level instruction on how to determine whether it may be possible to restructure or rehabilitate the loan to halt the decline that has been identified.
What will you learn
By the end of this course you will:
- A clear understanding of the negative effects of credit migration from a lender’s perspective
- An understanding of common causes of business failure and the most appropriate responses
- The key skills to support effective exposure monitoring and the early identification of credit deterioration
- An understanding of the options available to a lender in response to adverse credit migration
- An understanding of what conditions are required to facilitate the rehabilitation or restructure of a deteriorating lending asset
Main topics covered during this training
- The Impacts of Problem Debt
- Early Warning Signs of Credit Deterioration
- Accounting as Problem Indicator
- Matching Early Action to Early Warnings
- Management and Other Stakeholders
- Formulating a resolution strategy
- Implementing an Action Plan
Who should attend
This workshop is targeted primarily at staff working in the financial services sector, especially:
- Risk managers and credit analysts
- Middle and back office personnel involved in portfolio monitoring
- Regulators and supervisory professionals
- Business managers and team leaders
- Internal auditors and Loan Quality Assurance staff
Bad Loans - Early Warning Signs & Effective Actions - A 2 Day Course
- What are the characteristics of a Non Performing Loan
- Accounting and Capital Impacts of NPLs for lenders?
- Reputational and other implications for lenders
- The decent into distress – The importance of timely action
- Effective loan monitoring – the principles of good credit control
- Common causes of business failure
- The Credit Cycle – Evaluating changes to the business environment
- Identifying business operational failings
- Changes in Management Behaviour – a clear EWS!
- Possible Indications of Fraud
- How to use borrower credit metrics in detecting early warning signs
- Beware of off-balance sheet exposures – what they might hide
- Liquidity vs. Solvency Risks – causes and effects
- Hiding negative trends – Creative accounting – what and why?
- A review of common accounting tricks
- The benefits of setting internal triggers to prompt action
- Proactive monitoring – Assessing the threat from an EWS
- Quantifying potential losses – the requirements of IFRS 9
- The insecurity of security – understanding collateral
- Reviewing the options – exit or restructure?
- Engaging and assessing management. What is their view of the problem, and are they capable of delivering a resolution?
- Dealing with Equity Sponsors – their likely agenda and attitude to the holders of debt
- The potential agendas and concerns of other lenders
- Identifying other key commercial stakeholders
- Establishing control – immediate protective actions
- Establishing the crisis timeline – how long have we got?
- The importance of value preservation
- Information is key – possible sources and uses.
- Structural considerations – Who is subordinated and who might need to be involved?
- Establishing the result required – what is the preferred course of action?
- Consider the delivery options – Insolvency or Consensual solutions?
- Establishing roles and responsibilities in a restructure
- Managing conflicts of interest
- Stakeholder Management – core principles
- Monitoring the outcome
- Working through a comprehensive case study
Tim has a banking career spanning almost 40 years, during which period he has worked for RBS Group, Santander Group and Moody’s Corporation.
The first 12 years of his career were spent in RBS retail banking where he rose quickly through the ranks to become Operations Manager of a large UK provincial branch. He subsequently moved into a Senior Credit Risk role, where he was responsible for the establishment and management of a new of a new centralised team that used technology solutions to monitor the bank’s small business customer base across England & Wales; the objective being to identify and initiate remediation strategies for emerging problem loans.
In the early 1990’s Tim moved into Corporate Banking, and initially spent 4 years in a debt restructuring role. He subsequently moved to the world of Corporate & Structured Finance and spent the following 15 years originating, structuring and managing the credit risk related to complex leveraged transactions. In that capacity he was involved in negotiating both Senior Debt and Mezzanine lending positions, both as a bi–lateral lender or as part of a syndicate.
In 2009, Tim returned to Corporate Debt Restructuring, initially as a transaction lead banker, but subsequently as the Global Head of Technical Learning & Development for the Restructuring Division of a major bank with operations in 23 countries worldwide.
Tim subsequently led a team of Credit Analysts looking at large exposures in the Manufacturing, Mining and Transport sectors on behalf of Santander Global Banking Markets before taking on an interim role as the interim Head of Credit for a fast-growing UK based Challenger Bank, supporting the highly successful IPO of that business. before becoming a full-time financial services trainer and academic lecturer. In that latter capacity he has undertaken numerous assignments right across the EMEA region and also in Asia.
Tim is an Associate of the Chartered Institute of Bankers of England & Wales.
Most of our public courses are run over 2 full days. Some programmes are offered as a 1 or 3 day training.
In-house training is tailored to client’s requirements and can be organised over 1 day, 2-3 weeks or longer.
Public courses are organised mainly in London and Dubai. Occasionally we organise courses in other centres like Paris or New York. Check our public course calendar for the current list of programmes. We use a range of training venues, all in the centre of the cities and with excellent transport links to the airports and train stations.
In London we use venues in the centre (near Oxford Circus station or in Mayfair) or in the City (near Liverpool Street or Moorgate stations).
In Dubai our courses are organised in one of 4-5* hotels in the Deira district. Once you register we will send you detailed information together with accommodation options if required.
Our in-house courses can be delivered anywhere in the world. We work with over 25 trainers worldwide. Contact us do discuss your requirements. Check our list of available programmes.
Our courses are run in central locations from 9 a.m until 5-5.30 p.m. There are 2 coffee breaks and a lunch break. Lunch is always provided in the venue.
Dress code is smart casual.
All our programmes are taught by senior specialists who have spent many years in their respective sectors, working as senior managers and head of departments, so they understand very well the market and the challenges you are facing.
The experience of our trainers allows us to create very practical programmes, focused on current market trends and challenges. You can be sure that you will gain the knowledge which can be instantly applied in your workplace after the course. You will be analysing real life case studies, take part in group exercises and discussions as well as role plays, whenever applicable.
We want our courses to be as practical and interactive as possible so we limit the number of participants in order to optimise your time with the trainer and allow you to ask questions which are important for you.
In order to understand your requirements and expectations, we will send you a pre-course questionnaire.
You will also receive post-course support so if you have any questions after you left the training, you are welcome to contact us.
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After you register, we will send you registration confirmation and an invoice so you can arrange the payment. Please note that your place is not confirmed until we receive it.
If you register within Early Bird discount period, there’s limited time to arrange the payment in order to be eligible for the discount. You will find all the details on the invoice.
We don’t advise to make any travel and hotel arrangements until you receive full course confirmation from us.
We will send you venue and course details as soon as possible but most likely about 3-4 weeks prior to the course commencement.
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The price doesn’t include accommodation, flights, transfers and any additional costs outside of the training venue.
Yes, we always offer Early Bird discount, so the sooner you register the more savings you can make. We also offer group discounts and if you register for 2 or more programmes at the same time.
If you are a full time student or unemployed, we offer a 25% discount of the full price of the training. Student ID or unemployment status confirmation is required to claim this discount.
If you attend one of our courses you will be entitled to a special discount for a year after the last course you attend with us. Also, if you have attended and recommended us to a friend, both you and your friend will receive a special discount. You will receive more information about it after you attend the course.
See our Customer Loyalty Discounts page for more details.
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You can, however, claim the VAT back by contacting UK tax office - HMRC, and filling the relevant form, as long as you comply with the following rules:
For Delegates coming from the EU countries
If you represent a registered business in another EU country, you can use the Refund Scheme to reclaim VAT you pay in the UK as long as all of the following apply:
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You can find some more information here. In order to claim the VAT you have to fill Form 65.
For the Delegates from Non EU countries
If you represent a registered business in a non-EU country, you can use the Refund Scheme to reclaim VAT you pay in the UK as long as all of the following apply:
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If the following rules apply to you, please fill the 65A form and send it to HMRC.
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Alternatively, for cancellations requests received more than 20 working days before the course date we will offer a refund less an administration fee of 10% of the course price.
We regret that no refunds can be given after this period. Non-attendance without any notification will be charged at full rate.
Cancellations must be made in writing and reach our office 20 working days prior to the course date.
Your place on a course is not guaranteed until we receive the payment. All payments must be made in full before the course date.
All our trainers have been working for many years in their respective sectors before they begun to teach so they bring a wealth of practical experience to the classroom.
Most of them used to work for 15 or more years in the financial sector and corporate world, and were holding positions of Directors, VP and Senior Managers. Some of them have published books and have written articles for specialised magazines and newspapers including FT, The Independent, The Times etc. You can find detailed biography of each trainer on the page of the course you want to register for.
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