Introduction

The financial landscape has evolved far beyond traditional banking, with a growing and complex 'shadow banking' system playing a critical role in providing credit. This sector, encompassing a wide range of non-bank financial institutions and market-based activities, operates with different regulatory oversight and risk profiles than conventional lenders. As a result, assessing the creditworthiness and risks within this opaque and interconnected system requires a new set of skills and analytical frameworks. This course is designed to provide you with the strategic insights and practical tools to effectively navigate this new frontier of credit analysis.

This comprehensive program provides a deep dive into the theoretical and practical aspects of shadow banking credit. You will explore the interconnected nature of these fields, learning to assess the creditworthiness of non-bank financial institutions and the unique risks inherent in their financing activities. The course emphasizes the quantitative and qualitative tools required to analyze a shadow banking entity, from credit scoring models to dynamic risk assessment and portfolio management. By the end of this training, you will be proficient in using advanced analytics to make smarter decisions, manage the unique risks of this sector, and unlock significant value in your investment and lending activities.

Duration: 10 Days

Target Audience

• Financial risk analysts
• Investment fund managers
• Financial model developers
• Data scientists
• Regulatory compliance officers
• Credit risk managers
• Financial technology (fintech) professionals
• Business development officers
• Investment bankers
• Legal and compliance officers

Objectives

• Understand the core concepts of shadow banking.
• Master the principles of shadow banking credit risk assessment.
• Analyze the key risk variables in a shadow banking portfolio.
• Learn to build and validate credit scoring models for this sector.
• Use quantitative tools for portfolio optimization.
• Understand the regulatory framework governing these practices.
• Optimize financing solutions for shadow banking entities.
• Develop a framework for shadow banking risk analysis.
• Assess the impact of macroeconomic shocks on this sector.
• Understand the ethical implications of financial transactions.

Course Modules

Module 1: Foundations of Shadow Banking

• The importance of shadow banking in the economy
• The unique challenges of shadow banking
• The difference between traditional and shadow banking
• The role of technology in shadow banking
• The impact of a changing economic environment

Module 2: Shadow Banking Credit Risk Assessment

• The principles of credit risk assessment for shadow banking
• The use of financial statements and non-traditional data
• The importance of qualitative factors
• The role of credit ratings and alternative data
• The challenges of assessing risk in this opaque sector

Module 3: Credit Scoring Models for Shadow Banking

• The principles of a credit scoring model
• The use of statistical methods and machine learning
• The importance of a reliable dataset
• The validation and back-testing of models
• The challenges of working with limited historical data

Module 4: The Shadow Banking Ecosystem

• The different players in the ecosystem: hedge funds, private equity, etc.
• The types of financing solutions
• The role of government and development finance institutions
• The importance of a collaborative approach
• The impact of regulatory changes on the ecosystem

Module 5: Securitization and Derivatives

• The principles of securitization
• The role of derivatives in risk management
• The use of credit default swaps
• The importance of a robust legal framework
• The challenges of a fragmented and opaque market

Module 6: Fintech and Alternative Lending

• The concept of alternative lending platforms
• The role of technology in automating lending decisions
• The benefits for both lenders and borrowers
• The importance of a robust technology platform
• The challenges of implementing these solutions

Module 7: The Regulatory and Legal Landscape

• An introduction to key financial regulations
• The role of regulators in overseeing shadow banking
• The legal challenges of cross-border transactions
• The importance of a robust compliance program
• The ethical implications of financial transactions

Module 8: Hedging and Mitigation Strategies

• The types of hedging instruments for shadow banking risk
• The use of credit insurance
• The importance of a robust hedging strategy
• The challenges of implementing a dynamic hedging program
• The role of derivatives in managing risk

Module 9: Portfolio Risk Management

• The concept of portfolio risk management
• The role of diversification in reducing risk
• The types of portfolio optimization techniques
• The importance of a data-driven approach
• The challenges of a rapidly changing market

Module 10: Capstone Project Part 1: Design

• Defining a specific portfolio of shadow banking assets for modeling
• Mapping the data requirements and model architecture
• Outlining the key technical and analytical requirements
• Creating a detailed project plan
• Presenting the design to a mock review board

Module 11: Capstone Project Part 2: Development

• Implementing a credit scoring model for a chosen asset
• Using the model to evaluate a sample of transactions
• Analyzing the model's performance on key metrics
• Building a presentation to explain the analysis
• Documenting all assumptions and data sources

Module 12: Capstone Project Part 3: Presentation

• Presenting the full analysis of the chosen shadow banking portfolio
• Discussing the risks and benefits of the model
• Proposing a plan for model improvement
• Q&A and peer feedback session
• Receiving expert recommendations and insights

Module 13: Emerging Trends

• The use of blockchain in shadow banking
• The role of AI in risk assessment
• The evolution of lending instruments
• The impact of new data sources on risk assessment
• The future of shadow banking

Module 14: Case Studies

• A case study of a major fund's lending division
• A case study of a non-bank financial institution's risk management
• A case study of a financial institution's regulatory challenges
• The lessons learned from past credit cycles
• The importance of a robust framework

Module 15: Course Certification

• A final comprehensive assessment
• A final review of key concepts and objectives
• Issuance of a certificate of completion
• Post-course career guidance and networking
• A final Q&A with instructors

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 10 working days before commencement of the training.