The credit memo structure direct lenders use.
Most private credit case studies end with a written recommendation. This is the structure of a lender's screening memo: a blank Word template, and the same seven sections filled in on a fictional sponsor-backed buyout.
Two .docx files. You also get the monthly Private Credit Brief; one click unsubscribes.
Seven sections, in the order a credit committee reads them
The filled example runs to about 1,150 words on a fourth buyout of a German industrial water treatment company, with the downside case written out.
- 1Deal snapshotCompany, deal type, sponsor, intermediary, deadline
- 2Process and proposed financingOwnership, how the deal was sourced, facility, leverage, pricing, hold size
- 3Business overviewRevenue mix, recurring share, customer concentration, footprint
- 4Industry overviewMarket size and growth, competitors, barriers to entry
- 5Investment thesisThree or four pillars, each with the data behind it
- 6Key deal issuesEach risk, its mitigants, and where leverage and coverage sit in the downside case
- 7Financial summaryThree historical years, LTM and two forecast years: EBITDA, free cash flow, leverage, interest and fixed charge cover, each EBITDA adjustment listed
The memo covers the written part of the case. The Private Credit Interview Guide covers the rest: 80 questions with model answers, three case formats and the lender's reading of each. See what the guide contains