Why Is That Revolving Line of Credit Not Revolving?

On-Demand Webinar:
StreamedMar 12, 2024Duration90 minutes
  • Unlimited & shareable access starting two business days after live stream
  • Available on desktop, mobile & tablet devices 24/7
  • Take-away toolkit
  • Ability to download webinar video
  • Presenter's contact info for questions
See Registration Options

Is a revolving line of credit (LOC) meant to be static or dynamic?

What should happen if a borrower’s short-term LOC becomes permanent working capital? Do you understand the asset conversion cycle? Join this insightful webinar to learn the answers to these questions and even more about revolving LOCs for commercial borrowers.

  • Educate borrowers on the proper use of a line of credit
  • Determine the proper amount of a line of credit
  • Understand what causes a line of credit to become permanent working capital
  • Analyze the asset conversion cycle to determine the impact on borrowings under the line of credit and to properly structure credit facilities
  • Identify how much of the line of credit should be converted to a term loan at maturity


How many times have you made available a revolving line of credit for commercial borrowers who borrow up to the maximum credit limit and keep the balance at that point all year? When this occurs, it is often referred to as an “evergreen,” “floored-in,” or “permanent” line of credit – and often frustrates lenders.

To be repaid, financial institutions must convert all or a portion of the LOC into a term loan. LOCs should be used to fund short-term obligations, such as payments to suppliers, payroll, taxes, and other immediate operational needs until the current assets are converted to cash. The conversion of assets to cash, known as the asset conversion cycle or the operating cycle, is key to understanding why that revolving line of credit is not revolving.
This session will examine in detail what causes a borrower’s short-term line of credit to become permanent working capital - whether intentional or unintentional. The presentation will distinguish between the two and provide a deeper understanding of the impact and interrelationship of sales, current assets, profits, cash flow, and creditors on the line of credit.


This informative webinar is designed for credit analysts, branch managers, consumer lenders, commercial lenders, loan review personnel, senior lending officers, senior credit officers, chief financial officers, and senior loan committee members.


  • List of reasons why revolving lines of credit stop revolving
  • Formula to determine the proper amount to offer under a line of credit
  • Employee training log
  • Interactive quiz
  • PDF of slides and speaker’s contact info for follow-up questions
  • Attendance certificate provided to self-report CE credits

NOTE: All materials are subject to copyright. Transmission, retransmission, or republishing of any webinar to other institutions or those not employed by your institution is prohibited. Print materials may be copied for eligible participants only.

Presented By

NormandCarolynCarolyn Normand
Bankers Insight Group, LLC