Loan Pricing | Course Module

Loan pricing is a core part of commercial banking, linking client risk, loan structure, and profitability into one decision-making process. This course introduces the fundamentals of loan pricing and shows how banking professionals assess credit risk, evaluate lending structures, and recommend pricing that reflects both risk and return. The course begins with debt as a funding source and explains how debt fits into a company’s capital structure relative to equity. It then builds into the mechanics of loan pricing, covering secured versus unsecured lending, repayment profiles, senior versus subordinated debt, and how each of these factors influences risk and profitability. You’ll learn how to define and interpret risk-adjusted return and risk-adjusted return on capital, evaluate different loan types, and understand why some facilities are more profitable or more risky than others. The course also explains how lenders think about repayment structures such as amortizing loans, balloon loans, bullet loans, and payment-in-kind loans, and why those structures affect pricing outcomes. The lessons use practical examples to connect theory to real lending situations, including management buyouts, vendor notes, refinancing decisions, and capital stack analysis. You’ll see how pricing decisions are shaped by collateral, subordination, leverage, repayment timing, and the broader commercial banking context. The course also gives you a clearer view of where loan pricing fits within commercial banking, especially in the mid-market, where transactions can vary widely in structure, borrower profile, and complexity. The focus is on building practical judgment that supports stronger credit analysis and more competitive lending decisions. Relevant for: Commercial banking professionals, credit analysts, relationship managers, risk management professionals, and finance learners looking to strengthen their understanding of loan pricing, lending structures, and banking profitability.