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Wall Street Prep

Bank & FIG Modeling

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Bank & FIG Modeling

Developed for FIG-focused investment bankers, equity research analysts and corporate finance teams at banks, this course guides trainees through a bank's financial statements, unique drivers, and regulatory framework. Please note, this bank & FIG modeling course is sold as a PDF E-Book and no video component.

Course Objective

At completion, trainees will have built a fully integrated financial statement model, RI model and DDM

The analysis of banks is different from that of most other types of industries. As a result, analysis requires adjustments and different approaches from traditional valuation methodologies. Wall Street Prep’s bank modeling course will guide you step-by-step through a bank’s financial statements, unique drivers and regulatory framework. You will build a fully integrated financial statement model, a residual income (RI) model, and a dividend discount model (DDM) using Valley National Bank as a case study.

This course is used to train new hires at:

What You Will Learn

  • Build an advanced bank forecast model, projecting asset and liability balances, interest rates and spreads for key assets and liabilities, using industry best practices
  • Learn to effectively forecast the loan portfolio, investment securities, and deposits
  • Understand the modeling and forecasting of allowances for loan losses and net charge offs (NCOs)
  • Model regulatory constraints and analyze effects on leverage, capital ratios, and profitability
  • Forecast net interest income (NII), asset yields, funding costs and interest earning assets (IEA) and liabilities (IBL) using an approach that takes into account typical disclosure gaps, is internally consistent, and avoids common modeling pitfalls
  • Build an advanced bank forecast model, projecting asset and liability balances, interest rates and spreads for key assets and liabilities, using industry best practices
  • Learn common forecast approaches for the non-interest income and expenses such as fees, and compensation
  • Identify the most appropriate “plugs” in a bank model to ensure the model balances, and address circular reference issues in the model
  • Using the results derived from the forecast model, build a residual (excess returns) income model
  • Build an adjusted dividend discount model using the prevailing beset practices for banks (not the same as non-banks)
  • Analyze how regulatory capital constraints effect valuation
  • Develop assumptions about return on equity (ROE), risk weight assets (RWA), cost of equity, and minimal capital ratio that are internally consistent for a multiple stage model
  • Compare the other valuation approaches such as comps and DCF and identify strengths and limitations of each approach

Course Highlights

Real World “On the Job” Investment Banking Training

The Bank Modeling Self Study Program bridges the gap between academics and the real world to equip industry professionals with the practical financial skill set they need on the job. The program utilizes a case study format, as students follow their tutorial guide alongside the Excel model templates, and are directed to the appropriate external documents (SEC filings, research reports, etc.) in order to build complex financial & valuation models the way they would on the job.

Support Center

Upon enrollment, students gain 24-month free access to Wall Street Prep’s Online Support Center, where they receive answers to questions, free downloads, and important updates.

Prerequisites

This course does not assume a prior background in Bank & FIG Modeling. However, those who enroll should have an introductory knowledge of accounting (e.g. interaction of balance sheet, cash flow, and income statement) and proficiency in Excel. Students with no prior background in Accounting should enroll in the Accounting Crash Course. Students with limited experience using Excel should enroll in the Excel Crash Course.

Earn CPE Credits with WSP Online Courses

Wall Street Prep is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.

The Wall Street Prep Quicklesson Series

7 Free Financial Modeling Lessons

Get instant access to video lessons taught by experienced investment bankers. Learn financial statement modeling, DCF, M&A, LBO, Comps and Excel shortcuts.