Seven Strategies for Achieving Balanced Loan Growth – Part 2
In part one of our series on the seven lending strategies to achieve balanced growth, we took a look at the ways that CRM systems help you drive efficiency in your loan origination process and how they are valuable for understanding your customers. Today’s focus is on efficiency in financial analysis.
Efficiencies Needed within Accounting, Tax Returns & Financial Statement Processing
Beyond an effective CRM, financial institutions must also look for ways to streamline their financial analysis processes with a dynamic statement spreading solution embedded in their loan origination system. By leveraging a loan origination system that offers automated tax return and financial statement processing, institutions can eliminate the tedious data entry work of entering financial statement and tax return data (often multiple times) which also ensures an accurate and consistent analysis of financial risk. This allows your analysts to be analysts; not just data entry clerks. Financial institutions can use automation to improve the quality and consistency of financial analysis in their loan origination processes as well as annual reviews.
A statement spreading solution within your loan origination system should facilitate reporting, data collection, global cash flow, covenants, a comprehensive credit memo and more. This creates the power to gain valuable insight into the commercial lending underwriting process – all within your loan origination system. Your loan origination system should also include a reliable source of comparative data and provide direct access to the complete database of the latest version of the RMA's Annual Statement Studies® within it’s statement analysis software.
Flexible formats in statement spreading are also important. Your loan origination system’s statement spreading and financial analysis should offer a wide range of formats. Standard as well as specialized industry templates should be built in. The ability to add covenants quickly and easily without having to leave the application is also critical to create efficiency.
When your loan origination system supports a dynamic structure in statement spreading, your underwriters and credit analysts will be empowered with the reporting and date they need to make good, consistent credit decisions. For example, in commercial real estate lending a customized charts of accounts should contain multiple levels of analysis for various types of borrowers and properties. This enables credit analysts and underwriters to group properties based on ownership or other types of underwriting criteria. Beyond CRE, this approach could apply to any category of specialized lending.
Baker Hill NextGen® Statement Spreading is a proven 30-year solution that offers unprecedented insight into the commercial lending underwriting process. This core component of the Baker Hill NextGen® platform facilitates reporting, data collection, global cash flow, covenants, a comprehensive credit memorandum, and more—all in one central location.
Stay tuned for the next installment in this series. If you’d like to learn more now, download our full eBook with all seven lending strategies.
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Seven Strategies for Achieving Balanced Loan Growth – Part 1
Posted on Friday, April 23, 2021 at 8:15 AM
by Baker Hill