Interview Question

Commercial Account Manager InterviewVancouver, BC

RBC

What is the most useful metric from the Financial Statements for lenders?

Answer

Interview Answers

5 Answers

1

Free Cash Flow as it helps to determine how much in interest payments the company can afford to make on an annual basis.

Anonymous on
0

I would say DSC (debt/ebitda), current ratio and D/TNW

Anonymous on
0

Sorry I meant .. DSC EBITDA/P+I

Anonymous on
1

In order of priority: 1. Liquidity ratios - should be atleast 1 or above Current ratio Quick Ratio Cash Conversion Cycle = DSO + DIO - DPO ..the lesser the number of days the more liquid 2. Debt Service Ratios: EBITDA/P+I Cash flow from operations/P+I Cash flow from operation - Capex /P+I 3. Leverage Ratios Debt/Equity Debt/Total Assets

Anna on
0

i would say Debt / EBITDA ratio, as a lender, we care more about its debt repayment ability.

Anonymous on

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