Credit analysts must understand current regulatory expectations and concerns. Before the onset of COVID-19, asset quality was generally sound. Now regulators are closely watching credit concentrations and weakening underwriting. This webinar will provide insight on those issues and more and on how to prepare for your next safety and soundness exam. Is everything ship shape?
AFTER THIS WEBINAR YOU’LL BE ABLE TO:
- Comment on current regulatory guidance
- Understand regulatory expectations for basic underwriting skills, including:
- Analysis/calculation of the Cs of credit
- Cash flow and liquidity analysis
- Analysis of risk based on the complexity of the credit relationship
- Compliance with your institution’s policy requirements and guidelines
- Identifying policy exceptions and analyzing risk mitigations
- Implement forward-looking credit analysis
- Identify prudent loan workout and modification strategies
- Understand when a modification is considered a TDR
- Evaluate eased underwriting practices that examiners identified prior to COVID-19
- Identify and account for economic and business uncertainty
- Document and defend your credit analysis
- Manage credit concentration issues, including CRE
Prior to the onset of COVID-19, asset quality was generally sound industrywide. However, concerns over deteriorating underwriting standards and credit concentrations continue to attract regulatory attention, accounting for a significant share of matters requiring attention (MRAs) and matters requiring board attention (MRBAs). As the impacts of COVID-19 continue to unfold, it is imperative that credit personnel review policy, procedures, and practices to limit the potential decline in asset quality.
CAMELS ratings are now forward-looking. Therefore, historically low delinquencies and charge-offs will no longer automatically earn an institution a “1" rating in asset quality. Financial institutions are expected to base credit analysis processes on the complexity of each credit and the risk profile of each institution.
Financial regulators will evaluate the quality and depth of your institution’s credit analysis, including the awareness of existing or emerging risk concerns; stressing for an uncertain future; tying current and new underwriting to the institution’s risk appetite statement; and adequacy of post-funding monitoring and analysis.
This presentation will focus on current regulatory credit issues and provide insights on how to prepare for your next safety and soundness exam.
WHO SHOULD ATTEND?
This informative session is designed for those involved in underwriting and approving commercial loans, including executive management on the loan approval committee, commercial loan officers, credit analysts, commercial loan underwriters, branch managers with commercial lending authority, loan review staff, and auditors.
- Employee training log
- Interactive quiz
SPEAKER: Aaron Lewis, Young & Associates, Inc.
Aaron Lewis is a senior consultant at Young & Associates, Inc. With over 15 years in the banking industry, his expertise is now dedicated to the lending division of Young & Associates where he assists financial institutions with loan, ALLL, policy, and credit-process and compliance reviews. He also conducts seminars on credit risk and compliance.
Prior to joining Young & Associates, Aaron was the Vice President Credit Administrator of a community financial institution in southeast Michigan and managed all facets of the lending function, including originations, underwriting, ALLL analysis, servicing, and secondary market compliance. He holds a Bachelor’s in finance from Michigan State University and graduated from the Graduate School of Banking, University of Wisconsin.