Are you interested in building models yourself? Raising the bar for your modeling journey? Maybe you’d like to see our approach in action? We are happy to share our experience. In the series of articles we present certain modeling cases and situations.

Each PDF article below involves a little bit of theory and a lot of practice, including all the accompanying Excel models.

Financial modelers are the key audience. That said, if you’re an analyst with an acute interest in the topic, you might be interested, too.

Cash flow financial modeling 101 for legacy commercial banking

Fundamentals of modeling cash flows of old-style commercial banks for financial modelers lacking FIG background

Basel III

image credit: Finance Watch

Commercial banking as a business is very specific. It’s different from standard manufacturing, or merchandising, or services. Thus if you’re a modeler with background in modeling mainly manufacturing companies, and banking model is your next project, you need to learn the specifics of banking before diving in. This tutorial article will help you do just that.

Inside, you’ll find the fundamentals of operating modeling for banking in line with good modeling practices. You will learn how to build a correct fully integrated commercial banking model meeting basic regulatory requirements.

The model you’ll arrive to in the end will be a simple yet capable tool for capturing key interrelations in the commercial bank’s cash flow analysis. You’ll be able to build on it in any way you want, like valuation, FP&A, and more, as your project involves.