2 questions reported in PNC interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
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Model builds
Built in the spreadsheet grid
Leverage capacity, documentation, downside cases and portfolio construction. 1 question
A distinct discipline from cash flow lending, and common in retail and distribution credits.
How does asset-based lending differ from cash flow lending? Construct a borrowing base for a distributor with $200m of receivables and $150m of inventory.
Structuring for downside, collateral, priming risk and recovery. 1 question
An asset-based lending scenario that distinguishes collateral availability from headline debt capacity.
An ABL facility has $80m outstanding. Eligible receivables are $60m at an 80% advance rate and eligible inventory is $50m at a 50% advance rate. Is there a borrowing-base shortfall, and what do you…
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
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