Credit Risk Analysis from Udemy

This highly practical course has been specifically designed for candidates aspiring for a career in Commercial and Retail Finance, Credit Appraisal, Credit Monitoring, Credit Ratings and Credit Strategy.

Credit risk is a lender's potential for financial loss to a creditor, or the risk that the creditor will default on a loan. Lenders consider several factors when assessing a borrower's risk, including their income, debt, and repayment history.

redit risk analysis is the process of evaluating the likelihood of a borrower defaulting on a loan. Lenders use various techniques and models to assess the creditworthiness of individuals and businesses. Credit risk analysis helps lenders to minimize losses, optimize interest rates, and diversify portfolios. Credit risk analysis also benefits borrowers by enabling them to access credit, improve their credit scores, and negotiate better terms.

This course will cover relevant and practical topics like Liquidity Analysis, Stress Testing, Comparison: Sector versus Global, Liquidation Scenario and Event, M&A/LBO, Banker’s Angle to Credit Analysis, Bank CMA Format and Credit Policy Formulation, Preparation of Credit Proposal and Credit Appraisal, Capital Budgeting Methods, Loan/Bond, Behavioral Aspects of Credit officer, Pre-sanction Methodologies and Analysis, Know your Customer (KYC) requirements, ESG Analysis for Loans/Bonds, Case studies.

This course will will enable the students to Perform credit appraisal with global best practices, Generate better trade ideas & identify problem loans, Amplify their credit monitoring system, Enhance Basel based internal rating system, Make lending and investment recommendations and Design credit strategy and credit portfolios.

What's inside

Learning objectives

Understand credit risk analysis
Be able to prepare various stressed scenarios and interpret the economic outcome from them

Will be able to evaluate acquisition targets meaningfully

Understand credit risk analysis
Be able to prepare various stressed scenarios and interpret the economic outcome from them
Will be able to evaluate acquisition targets meaningfully

Syllabus

Covers Liquidity basics, concept of Solvency, Liquidity measures, Analysis tools and Debt Maturity Schedule

This lecture introduces the faculty and the structure of the course

This lecture covers the fundamentals of Liquidity, helps a student differentiate between liquidity and solvency and describes the various measures of liquidity.

At the end of this lecture, the student will be able to understand the phenomena leading to financial stress, identify and explain the key steps in stress testing, List and explain the framework for developing scenarios, understand Revenue drivers, cost drivers and leveraged balance sheets with respect to financial stress, identify the internal, industry and environmental considerations for financial stress and explain the stressed scenarios for commodities.

This lecture demonstrates a stress testing model with base case scenario.

This lecture demonstrates stress testing models with bear and bull case scenarios.

Student will be able to understand the need for peer comparison and identify suitable peers for a meaningful analysis

This lecture will help the student understand Seniority and subordination in Debt, Hierarchy of Seniority and Liquidation scenarios

This topic discusses the credit analysis in case of special events such as Mergers and Acquisitions and also lists the steps that an analyst should take in order to do an in-depth credit analysis of an Acquirer post acquisition.

This topic shows the credit model to do the credit analysis in case of special events such as Mergers and Acquisitions and also discusses Leveraged Buyouts

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Read about what's good

what should give you pause

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Enables learners to perform credit appraisal using global best practices, which is essential for roles in commercial finance and credit monitoring

Covers Basel-based internal rating systems, which are used by financial institutions to assess credit risk and determine capital adequacy

Explores stress testing models with base case, bear, and bull case scenarios, which are used to evaluate the impact of adverse events on financial institutions

Examines liquidity analysis, solvency concepts, and debt maturity schedules, which are fundamental for assessing a company's financial health

Includes a discussion of credit analysis in special events such as mergers, acquisitions, and leveraged buyouts, which is relevant for investment banking

Requires learners to understand the need for peer comparison and identify suitable peers for meaningful analysis, which is essential for benchmarking

Reviews summary

Practical foundation for credit risk careers

According to learners, the Credit Risk Analysis course is highly practical and directly relevant to careers in finance, particularly credit roles. Many students find the course content comprehensive, effectively covering key areas like liquidity analysis, stress testing, and M&A/LBO credit analysis. The instructor is often praised for clear explanations. While widely seen as providing a solid foundation and being excellent for beginners or those new to the field, some reviewers with prior experience felt parts were basic or desired more advanced modeling techniques. Overall, the course provides actionable insights and includes useful case studies and quizzes that reinforce learning.

Aids learning and reinforces concepts.

"The case studies were particularly helpful in applying concepts..."

"The quizzes helped reinforce learning."

"The practical examples were useful..."

"The quizzes are helpful for checking understanding."

Instructor is knowledgeable and clear.

"The instructor clearly knows the material inside out."

"Some slides were a bit dense with text, but the lectures explained them well."

"The M&A/LBO section was well explained."

Covers key credit risk topics effectively.

"Solid overview of credit risk. Covers all the key areas mentioned in the syllabus."

"The breakdown of topics like debt seniority and liquidation scenarios is very clear."

"The sections on M&A/LBO and ESG analysis were particularly valuable..."

"Engaging content, especially the stress testing models."

Offers directly applicable skills for finance roles.

"Excellent course! Very practical and relevant for my job in credit analysis."

"Highly relevant, practical, and well-structured."

"Practical, actionable insights. This course delivers exactly what it promises."

"I learned how to use practical tools and strategies that I could apply immediately to my work."

"Provided a good framework... a worthwhile investment."

Excellent for beginners, potentially basic for advanced.

"Decent course, but felt the level was quite basic in some areas. If you have prior experience, you might find parts repetitive."

"Disappointed. The course felt like a broad overview rather than an in-depth analysis. Expected more complex case studies and modeling. Perhaps better for beginners."

"Good introduction to the concepts."

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Credit Risk Analysis with these activities:

Review Accounting Principles

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Solidify your understanding of fundamental accounting principles to better interpret financial statements during credit risk analysis.

Browse courses on Financial Accounting

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Review key accounting concepts and terminology.
Practice analyzing sample financial statements.

Review 'Financial Statement Analysis & Valuation'

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Deepen your understanding of financial statement analysis techniques to improve your credit risk assessment skills.

View Putting Knowledge to Work on Amazon

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Read the chapters on ratio analysis and cash flow analysis.
Work through the examples and practice problems.

Practice Ratio Analysis Calculations

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Reinforce your understanding of key financial ratios by practicing calculations using different financial statements.

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Gather sample financial statements from various companies.
Calculate key ratios such as liquidity ratios, solvency ratios, and profitability ratios.
Compare the ratios to industry benchmarks.

Three other activities

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Create a Credit Risk Analysis Template

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Develop a reusable template for conducting credit risk analysis, incorporating key ratios, metrics, and considerations.

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Identify the key elements of a credit risk analysis.
Design a template that includes these elements.
Populate the template with sample data.
Refine the template based on feedback.

Analyze the Credit Risk of a Public Company

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Apply the concepts learned in the course to a real-world scenario by analyzing the credit risk of a publicly traded company.

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Select a public company to analyze.
Gather the company's financial statements and other relevant information.
Analyze the company's liquidity, solvency, and profitability.
Assess the company's credit risk using various ratios and models.
Write a report summarizing your findings and recommendations.

Review 'Credit Risk Management'

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Expand your knowledge of credit risk management techniques and best practices.

View Financial Engineering: The Evolution of a... on Amazon

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Read the chapters on credit risk modeling and mitigation.
Take notes on key concepts and techniques.

Career center

Learners who complete Credit Risk Analysis will develop knowledge and skills that may be useful to these careers:

Credit Analyst

A Credit Analyst evaluates the creditworthiness of individuals or businesses applying for loans. This role involves analyzing financial statements, assessing risk, and making recommendations on loan approvals. This course, with its focus on understanding credit risk analysis, will help a Credit Analyst to perform credit appraisal using global best practices. The course covers topics such as liquidity analysis, stress testing, and peer comparison, which are fundamental skills for a Credit Analyst, enabling them to form better judgements and identify problem areas. The course's exploration of M&A/LBO scenarios further equips the Credit Analyst with tools for comprehensive risk assessment.

See salaries and explore the career path for Credit Analyst

Commercial Loan Officer

A Commercial Loan Officer works with businesses to provide loans and other financial products. This role requires a deep understanding of credit risk and the ability to analyze financial information to make sound lending decisions. This course provides an understanding of credit risk, which is crucial for a Commercial Loan Officer, and will prepare them to assess the liquidity, solvency, and overall financial health of a business. The course also delves into the generation of trade ideas and identification of problem loans, which will make a Commercial Loan Officer a more astute decision maker.

See salaries and explore the career path for Commercial Loan Officer

Credit Underwriter

A Credit Underwriter evaluates the risk of lending money to individuals or businesses. Credit Underwriters assess creditworthiness based on various financial and non-financial factors. This course will help a Credit Underwriter to perform credit appraisal using global best practices and will aid in the development of a more robust approach to assessing applicants. The course’s emphasis on loan analysis and stress testing helps build a foundation for effective underwriting decisions. The inclusion of topics like Basel based internal rating systems will also be beneficial for a Credit Underwriter.

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Credit Risk Manager

A Credit Risk Manager is responsible for developing and implementing credit risk policies and procedures within an organization. This role needs in depth knowledge of credit-related topics. This course directly aligns with the responsibilities of a Credit Risk Manager, with its emphasis on credit strategy and portfolio design. The course’s detailed coverage of credit appraisal, stress testing, and scenario analysis gives a Credit Risk Manager the needed insights to enhance their internal rating system and inform risk management strategies. Furthermore, the course will allow a Credit Risk Manager to perform credit appraisal with global best practices.

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Credit Rating Analyst

A Credit Rating Analyst assesses the creditworthiness of organizations and debt instruments, assigning a rating that signifies their level of risk. This role requires in depth knowledge of credit risk, financial analysis, and rating methodologies. This course is a strong fit for a Credit Rating Analyst, as its core focus aligns very closely with the work of this role. The course covers topics such as liquidity, stress testing, and credit appraisal, all of which are vital components of the rating process. The course provides both theoretical and practical knowledge needed to build a solid foundation for a successful career as a Credit Rating Analyst.

See salaries and explore the career path for Credit Rating Analyst

Loan Review Specialist

A Loan Review Specialist evaluates the quality and risk of loans within a bank or financial institution. This role includes assessing loan documentation, payment history, and compliance with regulations, and it requires an in depth understanding of the lending process. This course, with its focus on credit appraisal and credit monitoring, will directly benefit a Loan Review Specialist. The course provides necessary insights of credit policy formulation, pre-sanction methodologies, and other important aspects of lending, which a Loan Review Specialist needs in order to provide useful and quality reporting.

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Risk Analyst

A Risk Analyst identifies and assesses various risks that could impact an organization. This role requires a deep understanding of risk management principles, as well as the ability to analyze data and develop risk mitigation strategies. This course is a great fit for a Risk Analyst, as it specifically focuses on credit risk analysis. By diving into stress testing, scenario planning, and liquidity assessments, this course provides a solid backdrop for a Risk Analyst to enhance their understanding of risk and to develop comprehensive risk models. It will also help a Risk Analyst better interpret economic outcomes and make needed adjustments.

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Corporate Banking Associate

A Corporate Banking Associate works to develop and manage relationships with corporate clients, providing them with financial solutions and services. This role needs a thorough understanding of credit risk, financial analysis, and lending practices. This course will be helpful to a Corporate Banking Associate, with its emphasis on understanding credit risk, and its coverage of credit appraisal, liquidity analysis, and the development of credit proposals. This course directly complements the responsibilities of a Corporate Banking Associate, helping them to make sound recommendations and provide valuable advice to their clients.

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Financial Examiner

A Financial Examiner performs audits and examinations of financial institutions to assess their compliance with regulations and their financial stability. This role needs a deep understanding of credit risk management and banking practices. This course provides a solid foundation for a Financial Examiner, as it covers topics such as stress testing, liquidity analysis, and credit policy. The knowledge gained from the course will enable a Financial Examiner to better assess an institution's credit risk management practices and their overall financial health.

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Debt Portfolio Manager

A Debt Portfolio Manager oversees a portfolio of debt investments, aiming to achieve specific return goals while managing risk effectively, utilizing tools like stress testing. This role requires a deep understanding of financial markets, credit analysis, and portfolio management strategies. This course will benefit a Debt Portfolio Manager as it provides a base understanding of credit risk analysis. The course offers knowledge spanning debt analysis, stress testing, and liquidation scenarios—all directly relevant to making informed decisions while managing a debt portfolio, improving performance and minimizing risks.

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Credit Operations Specialist

A Credit Operations Specialist monitors and manages the operational aspects of credit and lending processes. This role requires a solid understanding of credit risk, compliance, and operational procedures. This course may be valuable for a Credit Operations Specialist, as it provides the fundamental knowledge of credit risk analysis. The course will help a Credit Operations Specialist when handling banking operations regarding liquidity, loan analysis, and credit monitoring and when implementing Basel based rating systems. The course's coverage of pre-sanction methodologies also provides relevant insights.

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Investment Analyst

An Investment Analyst researches and evaluates investment opportunities for firms or clients. This role requires knowledge of financial analysis, market trends, and risk assessment. This course may be useful for an Investment Analyst because it provides essential skills for analyzing credit risk and making informed investment decisions. The course will allow an Investment Analyst to evaluate acquisition targets and generate better trade ideas. The focus on stress testing and economic outcome interpretation will also aid in making strategic investment choices.

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Financial Analyst

A Financial Analyst provides analysis and insights to support financial decision-making within an organization. This role requires the ability to analyze financial statements, conduct market research, and interpret data to make recommendations. This course may be useful for a Financial Analyst, as topics such as liquidity analysis, stress testing, and peer comparison are relevant to this role. The course will help a Financial Analyst when performing assessments, making recommendations on various financial matters, and interpreting economic outcomes.

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Portfolio Manager

A Portfolio Manager is responsible for managing investment portfolios, aiming to maximize returns while minimizing risk. This role requires a strong understanding of credit risk, as well as the ability to analyze investment opportunities and make strategic decisions. This course may be useful for a Portfolio Manager, as it covers methods to design credit portfolios and make investment recommendations. The insights from the course on credit appraisal will help a Portfolio Manager assess and manage risk within their portfolios, making them more effective in their role.

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Treasury Analyst

A Treasury Analyst manages an organization’s cash flow, liquidity, and financial risk. This role requires a focus on financial strategy and risk management, with a strong understanding of economic forecasting. This course may be useful to a Treasury Analyst, due to its focus on liquidity analysis, which directly relates to treasury management. Understanding concepts like solvency, debt maturity, and cash management provides a foundation for a Treasury Analyst to develop and implement strategies for managing an organization's financial resources.

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Credit Risk Analysis

What's inside

Learning objectives

Syllabus

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Reviews summary

Practical foundation for credit risk careers

Activities

Career center

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