The Lendability Matrix
What is the Lendability Matrix, and where does it break?
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BY MICHAEL SHANG · SIXTEEN YEARS IN COMMERCIAL BANKING · UPDATED
// THE SHORT ANSWER
The Lendability Matrix is a way of thinking about which industries can support which kinds of debt — how much, at what tenor, against what security — read together with where the industry sits in its cycle and how concentrated its customers and suppliers are. It exists because no borrower can be properly understood without the context around them: the same balance sheet is a different risk in a sector at the top of its cycle than in one at the bottom. Where it breaks is as instructive as where it holds, and the breaks are structural rather than occasional.
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.
// IN THE BOOK
Developed in chapter 5, Reading the Industry, Not Just the Borrower.
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