Acuity Knowledge Partners Delivery Manager Interview Questions, Process, and Tips

Q1. What are Covenants in Commercial Lending
Ans. 
Covenants in commercial lending are conditions set by lenders that borrowers must meet to maintain the loan agreement.
• Covenants are financial ratios or performance metrics that borrowers must adhere to

• They are designed to protect the lender by ensuring the borrower remains financially stable

• Examples include debt-to-equity ratio, interest coverage ratio, and minimum liquidity requirements
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Q2. What is the difference between Bank Guarantee and Letter of Credit
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Bank Guarantee is a guarantee from a bank that a borrower will fulfill their financial obligations, while Letter of Credit is a payment method where the bank guarantees payment to the seller.
• Bank Guarantee is a guarantee provided by a bank to a beneficiary in case the applicant fails to fulfill their obligations.

• Letter of Credit is a payment method where the bank guarantees payment to the seller upon presentation of sp...read more
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Q3. What is Collateral in Commercial Lending
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Collateral in commercial lending refers to assets that a borrower pledges to a lender as security for a loan.
• Collateral can include real estate, equipment, inventory, accounts receivable, or other valuable assets.

• The lender can seize and sell the collateral if the borrower defaults on the loan.

• Collateral helps reduce the lender's risk and allows borrowers to access financing at lower interest rates.

• The value of the col...read more
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Q1. Self Introduction
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Q2. Situation based questions like Conflict of interest amongst team members, How to handle in case of high volumes, Any new updates on Secondary Loan Trading
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Q3. What is a Credit Agreement
Ans. 
A Credit Agreement is a contract between a borrower and a lender outlining the terms and conditions for a loan.
• It specifies the amount of the loan, interest rate, repayment schedule, and any collateral required.

• The agreement also includes provisions for default, late payments, and other consequences.

• Credit agreements can be for various types of loans, such as mortgages, car loans, or personal loans.
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Q1. In depth understanding of accounting
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Q1. Complete Cv screening, ratio analysis, US market, recent financial events, GAAP adjustments
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Any public listed company, make a credit report

Q1. Why acuity, next 5 years, what was your last profile
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Q1. Based on the corporate exposure so far.
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Q2. How to analyse counterparty based on the various parameters considering the industry in which they operate.
Ans. 
Analyzing counterparties involves assessing financial health, operational capacity, and industry-specific risks.
• Financial Stability: Review financial statements, credit ratings, and cash flow to assess risk. Example: A counterparty with a high debt-to-equity ratio may be riskier.

• Operational Capacity: Evaluate the counterparty's ability to deliver on commitments. Example: A logistics company with a robust fleet is more ...read more
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Q1. Same as mentioned earlier
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Q2. Same as mentioned above
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