Credit Analyst how-to
How to Analyze a Company with the Five Cs
The five Cs organize credit thinking.
Quick answer
The five Cs organize credit thinking. In short: character; capacity; capital, then complete the remaining steps below.
Step by step
Character: history and reputation.
Capacity: cash flow.
Capital: owner investment.
Collateral: security.
Conditions: industry and economy.
Weigh them together.
Safety reminders for credit analysts
- Protect borrower information
- Follow fair lending laws
- Avoid conflicts of interest
- Report suspected fraud
Key terms
Spreading · DSCR · Leverage · Liquidity · Collateral · LTV: see the full credit analyst glossary.