Professional Documents
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A. What is / are a Business Visions / Objectives?
B. What Should Your Business Plan Include?
1. An Introduction to Your Plan.
2. Who You Are and What Your Business Does.
3. Industry, Competitors & Business Strategy.
4. Financials Past, Present and Future.
5. Other Supporting Documents.
C. Assessment on Borrowers Creditworthiness.
The 5Cs of Credit
1. Character.
2. Capacity.
3. Capital.
4. Condition.
5. Collateral.
D. Checklist for Application of New Banking Facilities
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Type of facility.
Amount required.
Purpose for facility requested.
Repayment ability.
Opportunities
Threats
Character.
Capacity.
Capital.
Condition.
Collateral.
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1. Character.
- Assessing character of the borrower would include
assessment of the character of the shareholders and
management of the borrower under the following
categories:i)
ii)
iii)
iv)
v)
2. Capacity
- Ability of the borrower to generate cash flow to repay
the facility.
- The reliability of the cash flow.
- The Managements capacity to generate the cash flow.
3. Capital
- The sufficiency of financial commitment of
shareholders in the business.
4. Conditions
- External factors that can affect the borrowers ability to
repay the facility.
i)
Globalization factors ability to handle
globalization.
ii)
Competition how competition can affect the cash
flow of the borrower.
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iii)
iv)
v)
vi)
5. Collateral
- Collateral as the second way out. Type of security to
be obtained for the facilities recommended. Eg.
Tangible security like land and building, plant and
machinery, ships, vehicles, quoted or unquoted shares,
stock in trade and receivables.
Apart from all the above the company should at all time keep a clean
record. The company is to ensure that there are no overdue loans with
other financial institutions and no legal action taken against them.
D. Checklist for Application of New Banking Facilities
Thank You