Bank Analysis School - Case Study & Resources

APPENDIX B: Cash Flow Projections Cash flow projections are a forward-looking estimate of expected cash inflows and outflows over specific time periods (e.g., 30, 90, 180 days). Purpose: Helps bank management identify potential shortfalls and liquidity needs before they occur, allowing for proactive liquidity management. Key Considerations:  Assumptions matter - critical assumptions such as loan growth and deposit runoff must be realistic.  Stress testing - projections should include “what-if” scenarios (e.g., higher outflows, restricted funding) to ensure resilience under adverse conditions. Example Cash Flow Projection Format:

0-30 days

31-90 days

4-6 months

6-12 months

Expected Cash Outflows: *New Loans/Drawdowns New Investments Deposit Maturities and *Withdrawals Maturing Borrowings (E.g. FHLB) Total Periodic Outflows Expected Cash Inflows: Fed Funds Sold *New Deposit Growth Asset Maturities/Payments/*Prepayments Total Periodic Inflows

Periodic Net Cash Inflow/(Outflow) Cumulative Net Cash Inflow/(Outflow)

Available Liquid Assets: Cash and Due/Excess Reserves Unpledged Liquid Investments Total Liquid Assets External Funding Sources: Lines of Credit FHLB

Brokered Deposits (Internal Limit) Internet Deposits (Internal Limit) FRB Discount Window Total Borrowing Availability * Asterisk indicates critical assumptions which should be supported.