Financial Modelling Solutions in Excel

FSMD provides financial modelling solutions in Excel, in the form of training and consultancy for banks, corporates and housing associations detailed under each Sector heading.

Financial modelling consultancy is provided by Model Answers, a wholly owned subsidiary.

Typical projects are summarised below:

Financial Modelling Solutions in Excel – Example Applications

Scenario 1 – Commercial Bank

The client is an international commercial bank. The application is the financial credit analysis of middle market and large corporates using historical data and either the customer’s or bank’s forward projections. The analysis package replicates and dovetails with the bank’s own spreadsheet format.

The output is used by the bank’s corporate relationship managers as an aid to their judgemental credit decisions and is a core part of the credit application process. This is the latest version of a long series of such credit analysis models developed by FSMD for lending banks around the world.

Scenario 2 – European Multinational Corporate

The application was for consolidation and financial analysis of historical accounts and forward projections for M&A purposes. A fully integrated acquisition model capturing, reconciling and analysing five-year’s historical and ten-year’s forecast profit and loss, balance sheet and cash flow data.

The model facilitated the consolidation of target businesses by a predator company to investigate and analyse the optimal funding structure and financial impact of proposed acquisitions.

Scenario 3a – Public Sector Housing Regulators

The model was developed for two public sector regulators in the UK which regulate and channel government funding to Housing Associations (HAs) in England and Wales. The model helps informs regulators’ decisions about direct grants to individual HAs by assessing their past and projected financial performance and estimating debt capacity.

The latest version incorporates advanced sensitivity/scenario analysis plus a sophisticated Monte Carlo simulation facility for testing 30-year business plans against changing macro-economic scenarios.

Scenario 3b – Lender to the Social Housing Sector

The client is a UK-based mutual mortgage bank which lends long term to the Housing association sector. The application is for financial analysis of historical accounts data and forward projections for credit purposes.

The model, which encompasses the society’s entire portfolio of loans, can be used for credit analysis of individual associations, for sector aggregation and peer-group benchmarking and also for geographical mapping of credit exposure by post code across the UK. The total package also includes a risk grading and covenant monitoring function.

Scenario 4 – Transnational Development Bank

The client is a leading development bank which provides a range of debt, equity and quasi-equity investments, as well as grants, to support economic development projects throughout the developing world.

The application is for analysis of the performance of individual investments, total projects and the review and management of portfolio aggregations, for instance, currency, geographical region, sector and type of investment. The model also dovetails the aggregate portfolio with the annual consolidated financial accounts of the total fund.