This brief case is all about financially analyzing a firm. You are to prepare a TWO page note to Mr. Matocha, the senior lending officer at Southwest National Bank. Please address the following issues in your report to the bank about Classic Fixtures financial situation:
Why are Classic’s seasonal loan balance of $37M greater than was forecasted for the end of July?
Are the problems at Classic permanent or transitory?
How much should Mr. Matocha worry about the bank’s exposure to the loan at Classic?
What should Mr. Matocha suggest the management at Classics DO to reduce their loan balance?
What are possible negative implications of these suggestions?
