In my previous quarterly blog, I discussed 5 key areas to review as a form of an annual or periodic internal health checkup of your lending environment as a preemptive mitigation of potentially increasing risks resulting from a future economic recession. Because I continue to believe we are near or about to enter a recession in the very near future, I believe it is important to also review your institution’s readiness for your next bank regulatory safety and soundness.

We have experienced a strong and extended period of solid economic growth since 2010 (except for the agricultural sector).  In this period, per my observation as a bank consultant, the banking regulators and examiners have gone soft. This softness has caused the majority of institutions to ease up on their policies, documentation, and other lending procedures and controls in recent years. As a bank consultant and external loan review auditor for several clients, I am asked as to why I am so much tougher on them than the bank examiners have been recently? It’s because when the economic pendulum swings downward, the examiners have been known to go to in the opposite extreme very quickly, resulting in various levels of formal agreements or memorandums of understanding (MOU) or in some more severe cases, levying fines. I want my clients prepared so they avoid these types of actions in the future once the economy slows.

In my nearly 40-year career of banking and related consulting and software activities, I have accumulated a trove of information and guidance from various banking regulators regarding safety and soundness. For the first time, I have attempted to bring all of this information together and supplement with my observations or guidance on how to prepare for your next Bank Exam focusing on Safety and Soundness. I hope you find it useful for years to come!

Preparing for Your Next Bank Exam

With this resource available to you for future reference, you now have insight as to why we founded Suntell in 1996 and developed the Square 1 Credit Suite. Effective Loan Portfolio Management (LPM) requires an effective Management Information System (MIS). Square 1 Credit Suite is your MIS system to efficiently manage all of your institution’s LPM activities and incorporates each and every aspect of effective LPM as I summarized in the attached document – Preparing for Your Next Bank Exam.

Thank you,

Duane Lankard
Suntell CEO and Founder

Makers of the Square 1 Credit Suite