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Taking the Stimulus Out of Credit Analysis

Over the next few years, financial statements provided by customers could include stimulus proceeds that overstate their ability to make their loan payments. While stimulus programs were intended to keep business viable during the pandemic, some industry segments thrived and could use the funds received to reduce debt or bolster their cash position.

Understanding how to dissect the financial statements that you receive will be critical when assigning credit risk going forward. Below is quick guide to help you determine how to include some of the different stimulus programs that were offered during the pandemic.

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