Our Credit Assessment
Process
Our experienced credit risk team conducts robust due diligence and rigorous credit evaluation for all corporate debt opportunities to curate quality opportunities for investors.
01
Pre-Sanction Credit Risk Assessment
02
Deal
Structuring
03
Post-Sanction Monitoring
01
Pre-sanction credit risk assessment
Evaluation Phase
- Assessment of management credibility
- Adherence to legal, regulatory and statutory guidelines
- Review of past conduct with lenders
- Third-party verification
- Corporate governance concerns
Key factors analysed:
- Product and market evaluation
- Competitive analysis
- Financial metrics and margins
- Business risks
- Sensitivity analysis and stress test of operating cash flows
- Ability to infuse and raise money
- Verification of cash reserves for working capital needs, debt obligations and equity fund flows
02
Deal Structuring
Risk identification and mitigation phase
During the process of structuring a potential investment opportunity, the credit risk team identifies the risk associated and designs appropriate mitigants to minimize those risks through the application of various covenants and security packages.
Few covenant examples that Jiraaf may require borrowers to follow
Restrictions on repayment of other loans or corporate guarantees, until repaid to Jiraaf
Maintaining certain parameters such as Revenue, Costs, EBITDA, cash burn, etc.
Adherence to sufficient funds in Reserve Account for Servicing Debt
Restrictions on change in capital structure/management, shareholding pattern, etc.
Preserving credit rating of the company and maintaining pre-determined debt-equity ratio
No fundamental change to company such as Name, Registered Office, Authorised Capital
03
Post Sanction Monitoring
Early stress identification phase
We periodically engage with the counterparty to assess their financial health, monitor covenants,and identify any early stress signals to take pre-emptive corrective actions.