Research Talent Training Programme: Module 1
Essentials of Credit Risk Analysis
Course Dates: 11, 12, 18 & 19 November 2020 (4 Weekday Evenings, Interactive Virtual Classroom Setting)
Time: 7pm – 10pm
The Research Talent Training Programme is designed to equip participants with the necessary knowledge and skill sets to evaluate companies and develop investment theses and analyses. Please click here for the programme brochure.
Credit risk refers to the probability a borrower fails to make payment on any type of debt. Credit risk analysis considers factors such as sources of cashflows, business risk and capital structure to provide an understanding of the company’s ability to repay its obligations. This module covers practical examples to illustrate key concepts of credit risk analysis and provides the foundation required for Module 2 (Equities Analysis Workshop: A Practical Approach to Modelling and Valuation).
At the end of this module, participants will:
- Acquire skills required to evaluate credit risk of a company
- Identify early warning signals of deteriorating credit quality
- Understand key common accounting techniques used by companies to inflate assets and reported revenues
Business model analysis*
- Asset conversion cycle
- How cash is generated by the firm
- Critical success factors and risk mitigation
- Inherent industry, business and financial risks
- Reasons for business failure
Industry risk analysis*
- Structure of the industry, demand and supply
- Profitability and cost structure
- Competition and regulatory environment
- SWOT analysis (Strengths, Weaknesses, Opportunities and Threats)
Business performance of the company
- Key revenue, profitability and costs drivers
- Understanding the different performance and financial ratios
Financial statement analysis
- Balance Sheet, Income and Cashflow Statements analysis
- Review of key common negative accounting techniques
- Common contingent liabilities
Cashflow and liquidity risk analysis
- Generation and utilisation of cashflow
- Quality and strength of operating cashflow
- Early warning signs of cashflow crunch
- Debt maturity profile and refinancing risk
- Sources of liquidity for the company
Capital structure and debt servicing capability
- Sources of funding, funding risk and sustainability
- Interest and debt repayment evaluation
- Debt servicing ratios
Financial risk analysis
- Credit risk, interest rate risk, FX risk, commodity risk
Overview of interest rate and FX risk management tools
- Interest rate swap, interest rate cap, FX forward, FX option, cross-currency interest rate swap
- Discounted cashflow valuation method
- Other valuation methods: Price / Book Value ratio, Price / Earnings ratio, Dividend Yield, Earning Yield
*For these sessions in this module, participants are expected to do pre-reading of study materials and perform online research prior to commencement of class. Key learning points will be discussed and reviewed during the class.
Yew Jyu Lan, Chartered Financial Analyst (CFA) and has three Master degrees – a Master of Science (Real Estate) and Master of Social Science (Applied Economics) from the National University of Singapore (NUS) and an MBA (Finance) with distinction from New York University. She also holds a Bachelor of Science (Mathematics) from NUS and has a Certificate of Proficiency in Business Mandarin for Banking Professionals, awarded by the Singapore Chinese Chamber Institute of Business.
Jyu Lan has more than 24 years of banking experience gained at various major foreign and local banks covering:
a) Interest rate risk management for corporates;
b) Derivatives financial engineering (using interest rate, FX and commodities derivatives);
c) Corporate/real estate lending / Infrastructure project financing;
d) Asset securitization;
e) Distressed debt management / restructuring / recovery, and;
f) Asset/Liability management for banks.
The Financial Training Scheme (“FTS”) provides funding for financial sector-specific training programmes which are recognized under FTS. This scheme is only eligible for company-sponsored participants who are Singapore Citizens or Singapore Permanent Residents, physically based in Singapore, and who have successfully completed a FTS programme. Financial Institutions (MAS licensed or exempt entities), involved in or supporting financial sector activities, are eligible to submit claims for company-sponsored participants.
For all FTS programmes commencing on or after 1 July 2016, Singapore Citizens aged 40 years old and above will be eligible for 90% co-funding of direct training costs, subject to existing grant caps of S$2,000 per programme. Singapore Permanent Residents and Singapore Citizens below 40 years old will continue to be eligible for 50% co-funding of direct training costs for FTS programmes.
For more information, please refer to IBF website.
For further enquiries, please email firstname.lastname@example.org or call 6670-6808.
(Operating Hours: 9.00am to 5.00pm)
Terms and Conditions
Singapore Exchange reserves the right to make changes to the time, date, syllabus, speakers, venue or cancel the course if warranted by circumstances beyond its control.
Cancellation and Transfer Policy
Cancellation for a registration must be made in writing at least 10 business days before the event and a refund (less a 10% administrative fee of total course fee) will be made. No refunds will be given for cancellations received less than 10 business days prior to the event. All requests for replacement must be made in writing at least 3 business days prior to the event.
Register online and make payment via Paypal by clicking on the “Register” button.
For Bank Transfer, account details as follows:
Bank Name: OCBC
Bank Account Name: Salmon Thrust PTE Ltd – SGX Academy
Bank Account No.: 601-249881-001
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Enrolment is contingent upon receipt by Singapore Exchange of full payment and availability of space in the event. A confirmation note will be sent via email 10 business days before the seminar/course commences.