Financial institutions are often managing portfolio risk by initiating new lending products, participating in credit arrangements originated and managed by other lending institutions, and by acquiring or participating in credit arrangements originated by non-financial institutions. These products often have risk characteristics specific to the loan type or structure, and it may be prudent for the financial institution to have a loan review directed to any such portfolio(s).
Types of specialty lending include Asset Based Lending (ABL); Factoring; leveraged lending; Government Guaranteed programs, which include Government guaranteed loans (SBA, USDA, EXIM), purchase of a guaranteed loan strip only, and Government bond issues (SBA 504); Acquisition Development Construction (ADC) loans relative to controls and HVCRE; student loans; New Market Tax Credits; and other loan programs by third-party originators with a target audience of smaller financial institutions.
Different loan types will have specific risk attributes to be addressed and will often require credit policies to address those risk parameters and the financial institution’s risk tolerance for that loan pool. Our team of experienced loan reviewers have a wealth of experience with different loan products and types and can complete a targeted review with the appropriate focus. We work with the Client to determine any such loan populations, to determine an appropriate level of risk assessment, and to complete a thorough review.
As with our typical review process, the Client will receive a narrative report on each loan reviewed, which will include specific reference to the applicable risk factors, as well as our standard daily reports identifying any deficiencies. The Client will receive a Management Letter, which will describe the portfolio review, discuss the results, and will include commentary on any areas to be addressed through credit policy, Client practices, or best practices. Our Directors are available to review the Management Letter with the Client and to assist in developing any additional Policy enhancements or other risk management protocols.