HND个人及商业信贷.docx

1、HND个人及商业信贷SAMPLE INSTRUMENT OF ASSESSMENTCASE STUDYThis Case Study should be provided to candidates 7-10 days prior to the assessment date. A copy of the Case Study should be provided to each candidate on the date of the assessment along with the questions.All questions must be answered.You are the

2、manager of the West End branch of the Bell Bank plc.Your branch has been asked to train Michael Samuels, a new Graduate Management Trainee. Michael has a degree in Architecture from Glasgow University but has decided that a career in financial services would be more challenging.Michael has now been

3、with you for two weeks and has shown a keen willingness to learn. You have encouraged this willingness to learn by allowing him to sit in during some of your interviews with your customers. You have suggested that Michael take notes during each interview and then use these notes to ask you questions

4、 relating to each of the interviews.Michael has sat through four interviews. Some of the material facts relating to each interview are provided below.Interview 1John and Mary McCusker have been customers of your branch for 18 years. You have got to know the McCuskers quite well during your three-yea

5、r stay at the West End branch.John earns 35,000 per year from his job as a Quantity Surveyor and Mary earns 21,000 per year from her job as a Nurse. The McCuskers have three children aged 14,12 and 10. The two youngest children have always shared a bedroom but the McCuskers now feel the time is righ

6、t to move to a larger house to give all three children their own bedroom.You had agreed at an earlier interview to provide a capital and interest mortgage facility for 120,000 over 20 years, and the McCuskers have since purchased a new four-bedroomed house in Hamilton for 175,000. Their existing hom

7、e in Lanark has been sold for 120,000 and the McCuskers have 40,000 outstanding on their current mortgage loan. The McCuskers have now identified a problem in that they have arranged to move into their new home on 10 May but their buyers will not settle on their old home until 4 June.Michael Samuels

8、 is curious to learn what process you used to decide upon the mortgage facility that you agreed to provide the McCuskers, and to learn what you intend to do to help the McCuskers overcome their new problem.Interview 2You discussed providing a term loan of 80,000 over 15 years to your commercial cust

9、omers, Albion Tyres Ltd. Mark and James Thomas, a father and son, run the company, which has traded successfully for 8 years. Mr Thomas, Senior is 52 years of age and his son is 28 years of age.The business employs four members of staff, three of whom are tyre and exhaust fitters, and one of whom de

10、als with office administration. One of the fitters also deals with matters relating to brake and suspension repairs, a part of the business that accounts for around 15% of the overall turnover.The companys existing premises are now too small for the business and they have identified new premises in

11、the centre of town that would suit their purposes. It is expected that by moving into the centre of town that their turnover and profits should increase by around 20% per annum.The company has produced a substantial and impressive business plan, including a cash flow forecast that shows that the bus

12、iness should be able to comfortably meet the new commitments.The business plan has also incorporated the last three years accounts.You have asked the Thomas to allow you time to examine the information in the accounts before confirming your decision.Interview 3Monica Roberts requested a loan of 8,00

13、0 over 5 years. She has satisfied you that she can afford the repayments but has insisted that the loan be secured in return for a reduced rate of interest being charged by your bank.You have agreed to approve the loan and Monica has offered 2,000 Shares in CIC plc (current market price 450p per sha

14、re). She has also offered 2,000 6% Treasury Stock 2011 (current market price 102).Interview 4You arranged an appointment with your business customer, John Thomson, to discuss some concerns that you have been having with the operations of his business account. You have now made some suggestions to Mr

15、 Thomson to help him to regularise his financial position.Michael Samuels is somewhat confused as to how you were able to identify that there were problems with the operations of the business in the first place.QUESTIONSAll questions must be attempted.1. Following the interview with the McCuskers, M

16、ichael has asked you to explain to him the procedures that a lender would use to ensure that the decision made is sound and justifiable. Summarise the Principles of Lending, identifying the type of information that you would have obtained from the McCuskers during the interview for the mortgage appl

17、ication.2. Michael is curious to learn how you intend to deal with the McCuskers new problem:a. Identify the most appropriate loan facility that would help the McCuskers overcome their current predicament.b. Explain the main features of this loan facility, and c. Calculate the level of borrowing req

18、uired by the McCuskers.3. You have spent time with Michael showing him how to calculate various ratios from the accounts that Albion Tyres have provided. The following ratios have now been calculated:Ratio Year 2001 Year 2003 Year 2004Current Ratio 2.4:1 2.6:1 2.8:1 Liquid Ratio 0.5:1 0.8:1 1:1Gross

19、 Profit % 56% 58% 57%Net Profit % 23% 21% 20%ROCE % 42% 45% 56%Debtors Ratio 12 days 10 days 10 daysCreditors Ratio 45 days 55 days 55 daysStock Turnover 55 days 65 days 68 daysCapital Gearing 12% 10% 15%Explain to Michael how each ratio would have been calculated and how these figures might be inte

20、rpreted from a lending viewpoint.4. Albion Tyres are planning to move to new premises. You have identified that one of their employees, who specialises in brakes and suspensions, is a particularly important source of the companys sales and profits. Michael is concerned that the business might suffer

21、 temporarily if that employee were to fall ill. a. Identify the most relevant type of ancillary business insurance product that would protect the company against losses incurred due to the employees illness.b. Summarise the main features of this product, clearly explaining why you consider it to be

22、suitable.5. Michael is curious to learn how you intend to go about taking security over the shares and government securities offered by Monica Roberts. Summarise the methods used to ensure that security if effective over these assets.6. Michael was quite impressed that you were able to identify from

23、 John Thomsons business accounts that his business was getting into trouble. List and explain four of the warning signs that a lender can identify from the company accounts of a business. Assessment task1Outcome(s) covered1,2,3,4Suggested solution and making an assessment decisionSuggested Solutions

24、 to Sample Assessment1. The candidate should identify the principles of lending. Preferably the candidate will use one of the recognised mnemonics such as PARSERS, CAMPARI or CCCPARTS to identify the principles. Credit should be given to the student regardless of the mnemonic used. For the purpose o

25、f this solution PARSERS is being used.The principles that should be discussed are:Person - Character, capability and capitalAmount and PurposeRepayment Source and timingSecurityExpediencyRemunerationServices.The types of information that would be obtained under each heading include:Person: Age and d

26、ate of birth (if not already known from files) Childrens names and ages Employment details (although this may be listed on file, it is important to confirm that there have been no changes since the last interview) Salary (although independent confirmation would be required) Expenditure Assets and li

27、abilities Previous payment history.Amount and Purpose: Reason for loan request Amount of loan required Confirmation that purpose is acceptable (survey required to ensure that value and condition of the property is suitable) Term of borrowing Affordability of borrowing.Repayment: Confirmation of how

28、often salary is paid (there is now scope to set up repayment on a two-weekly basis to reduce overall cost of borrowing) Confirmation of receipt of salaries to bank Confirmation from employers that employment is permanent.Security: Standard security over new home required Confirmation that the proper

29、ty can be taken as security Value of property should be confirmed on bricks and mortar and reinstatement basis Confirmation that life cover has been arranged, and assign if required.Expendiency: Should be explained if identified as one of the principles However, it does not really apply in this situ

30、ation.Remuneration: Confirmation how fees, such as solicitors fees, valuers fees, lenders set up or arrangement fees, stamp duty, etc are to be paid Interest rate to be determined by type of facility being taken by borrower Are they looking for variable, fixed, capped rate etc.Services: Other produc

31、ts that might be relevant should be explained eg:o Payment protection insuranceo Buildings and contents insuranceo Life assurance.2. a. The McCuskers will require a closed ended bridging loanb. A bridging loan is required to provide short-term, large capital loans to assist buyers of property, who h

32、ave not yet received the proceeds from the sale of another property.Where the buyer is buying and selling a property at the same time, it may be that the date of entry to the new house will differ from the date of sale of the existing house.Since most buyers need at least some of the proceeds from the sale of their existing house to finance the purchase price