Part of identifying risk within your loan portfolio should include an annual review process where you review updated financial statements for your borrower, assess the health of the borrower, and make changes to the Credit Rating if necessary. The Suntell Loan Managment System includes tools to help you with your annual review process. In order to effectively use these tools, your organization should consider the following:
- Ensure that the Credit Ratings are configured to mirror your loan policy.
- Establish a Watch List range for those credit ratings to identify borrowers that should be included on the Watch List.
- Create a Customized Report associated with your Annual Review process and include information that is pertinent to a review of your borrower’s credit file.
- Configure a Documentation Tracking item to track required Annual Reviews.
Once the above items have been completed, your Annual Review process within the LMS can include some or all of the following:
- Updating financial information by adding new periods to your Spreads. The updated financial data can be used within the Commercial or Agricultural score. Score parameters can be used to assist you in determining a Credit Score for the borrower.
- Update Narrative analysis. Change the date of the analysis and update the information on your borrower. These may include narrative analysis of the financial statements, updated strengths and weaknesses or more.
- Review outstanding Documentation Exceptions. This may include your Annual Review tracking item. When a review has been completed, update the Document Date and Next Due Date for the annual review. You can use the grace period to control when this item becomes an exception: either before the Annual Review is due to work the item proactively, or after the review is due to give your office time to complete the review or the borrower time to provide you with updated information.
- If the borrower now falls onto the Watch List as a result of your review, use the Watch List Plans to create a plan to correct the Watch List status. You can also include the plan on your customized Annual Review report.
You can learn more about the functionality above by watching the recording of our most recent Lunch & Learn session (log-in required). Lunch and Learn sessions are free training sessions conducted by our knowledgeable training staff on the first and third Wednesday of each month.
