The Expert Solution for Lending, Risk Management, and Analytics

Eau Claire, Wisconsin for a week in January, Super Bowl in frigid Minneapolis, March madness and broken brackets, a week frozen solid in Rochester, New York, a bitter cold St. Patty’s, half a foot of snow on Easter (courtesy of Mother Nature and her cruel April Fool’s joke), sweaters and umbrellas at The Masters. “Cummon’ man!” It’s been a long Winter and even a longer Spring!

To the extent of what they can, financial institutions have been processing the requirement demands being cast upon them with the new “Current Expected Credit Loss” (CECL) standard to be implemented. Through a process assessment, most institutions have slowly started to form a picture/plan of how to satisfy the requirements. The 2006 Interagency Policy Statement notes, “The loan loss allowance should take into consideration all available information existing as of the financial statement date, including environmental factors such as industry, geographical, economic, and political factors.”

Most financial institutions know that their lending processes need improvement.  Unless the current lending process is automated from start to finish, there will always be room for process improvement.