Leveraged Lending Solutions

Given a sustained global economic downturn, we expect the default rate for leveraged loans to increase significantly. Banks will need to strengthen their current monitoring framework due to the higher credit risk in these portfolios. Renewals, refinancing, waivers, maturity extensions and amendments requests will increase, and banks will be required to ensure that risk is factored in appropriately.

Navigate this crisis with the power of credit insights and improved monitoring framework.

Benefits and Impact

Maintain a comprehensive monitoring framework

Compliant with SNC review and internal credit policy

A robust “dashboard” for faster decision making

More time for client-/risk-differentiating activities

Improved risk governance

Acuity Knowledge Partners’ Leveraged Lending Solutions Suite

Underwriting / re-underwriting

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Underwriting / re-underwriting

Financial model updates with projections
Detailed free cash flow analysis with de-leveraging trajectory
Base case, downside case, debt repayment analysis
Sensitivity analysis
Liquidity and working capital analysis
Enterprise Valuation (EV) analysis

Credit Performance update

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Credit Performance update

Financial model updates
Revisit Projections
Review of base case, downside case, debt repayment analysis
Covenant headroom trends
Liquidity and debt maturity trends
Refresh Enterprise Valuation (EV)
Tracking credit events and impact analysis
Annual and quarterly credit reviews

Early Warning Mechanism

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Early Warning Mechanism

Build triggers to track performance at portfolio level
Sector level reporting to track performance
Variance analysis on actual performance vs. original projections and borrower budget
Covenant headroom trends and analysis
Heat map analysis
Actual exposure vs. hold limits