Global cash flow
What is global cash flow in a credit assessment?
ONE OF 80 TERMS · FREE · NO SIGNUP
BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED
// THE SHORT ANSWER
Global cash flow is the combined reading of a business and its owners as one economic unit: the business's cash flow after its debt service, plus the owners' personal income and commitments, plus any related entities that lend to, borrow from or trade with the business. A desk reads it wherever an owner's guarantee is part of the security, or where drawings, related-party loans and personal debt make the company's own accounts an incomplete picture of who can pay what.
BASIS Practitioner judgment from sixteen years in commercial banking, set out in How Bankers Think (Highbank Press, 2026). Every borrower on this site is a composite constructed for teaching, not a client. The market is mid-market commercial lending as practised in New Zealand and Australia; where a convention differs elsewhere, the page says so.
// WORKED IN
// NEXT TO IT
- 5 Cs of credit
- Cash conversion cycle
- Working capital facility
- Quality of earnings
- Debtor days
- Borrowing base
- Covenant headroom
- Second way out
- Personal guarantee release
- Customer concentration
- Multi-currency facility
- Bankability
- Commitment fee
- Clean-down
- Self-liquidating
- Balloon payment
- Amortisation
- Debt service cover ratio (DSCR)
- Interest cover ratio
- Debt to EBITDA (leverage)
- Dilution (receivables)
- Advance rate
- Hardcore (overdraft)
- Loan to cost (LTC)
- Presales
- Standstill agreement
- Break cost
- Expected loss
- Dividend payout ratio
- Debt per kgMS
- Fixed charge cover ratio (FCCR)
- Interest reserve
- General security agreement (GSA)
- Negative pledge
- Condition precedent (CP)
- Event of default
- Covenant waiver
- Reservation of rights
- Watch list
- Risk grade
- Loan loss provision
- Going concern
- Management accounts
- Term-out
- Subordination
- Intercreditor agreement
- Club facility
- Unsecured lending
- Loan to value ratio (LVR)
- Forced-sale value
- Related-party transactions
- Capitalised costs
- Quantity surveyor (QS)
- Retention (construction)
- Peak debt
- Cash sweep
- Finance lease
- Adjusted EBITDA
- Interest rate swap
- Forward exchange contract
- Maturity transformation
- Risk-weighted assets
- Net interest margin
- Credit cycle
- Yield curve
- Transaction exposure
- Information barrier
- Conflict of interest
- Material non-public information
- Tipping off
- Suitability
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