Presentation Summary LESE 306 Fall 2008

Presentation Process Identify startup business/bank. Assumptions for spreadsheet model made by borrowing teams:  Unit costs and returns  Capital expenditure  Attitude towards risk Assumptions made by lending teams:  Credit standards  Scorecard evaluation weights

Borrowing Criteria Economic performance as measured by financial indicators, including ability to cover scheduled loan payments. Managing cash balances. Determining LOC needs. Evaluation of NPV. Potential impacts of alternative external shocks to baseline assumptions.

Lending Criteria Establishing bank credit standards Weights associated with specific standards. Examination of borrower’s baseline projections, including project feasibility. Examine impacts of alternative external shocks to baseline on financial indicators linked to bank credit standards.

Executive Summary

Borrowing Teams Limited background information on firm. economic analysis Focus primarily on economic analysis. Key assumptions in baseline scenario, including risk-adjusted discount rate, annual net cash flows, terminal value and capital expenditure. Summarize trends in financial indicators Summarize trends in financial indicators. Choice of shock and impact on the economic feasibility of the startup firm. Choice of shock and impact on the economic feasibility of the startup firm.

Lending Teams Limited background information on bank. Focus primarily on economic analysis Focus primarily on economic analysis. Credit standards required, including use of credit scoring and weights on standards. Evaluation of borrower’s baseline scenario. Nature of shocks used to analyze the feasibility of the loan under risk. Credit decision and why? Higher interest rate? Credit decision and why? Higher interest rate?

Content Text should be no longer than 2-3 pages in length. Can attached some screen captures of key graphs in your ppt slide show. Make sure focus is on economics. Spell check. clarity of expositionEmphasis on clarity of exposition.