= Members Only Content
ABA National Commercial Lending School
Curriculum and Faculty
(Subject to Change)
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Faculty
Cathy Berch Scott MacDonald Merrill Reynolds |
Although the ABA National Commercial Lending School continually updates its curriculum to keep pace with changes within the lending field, it focuses on key areas:
Appraisals Revisited
This course offering addresses the critical regulatory "hot buttons" that are presently causing concern for bankers. Recent examinations indicate that the regulators are spending more time looking at the bank's appraisal process and the prepared appraisals themselves. This course provides attendees with the general knowledge required to understand a commercial real estate appraisal. This course will help bankers evaluate the real estate appraisal as a key component in the credit risk assessment process for commercial real estate loans. The program covers recent revisions to the USPAP as well as any anticipated changes.
Banking and the Economy
Will new federal programs to support commercial real estate loans and business recovery continue? When does the government exit from its monetary stimulus strategy? What extraordinary reshaping of the financial services industry is still to come? Get answers to questions like these and predictions of what's ahead from a Federal Reserve senior research officer.
Bank Loan Simulations
Join breakout groups with fellow students from different banks for bid sessions. Bid sessions meet various times during the School week for teams to prepare credit decisions and bid for dozens of loan applications. You experience, first-hand, the formation of a commercial credit group and develop confidence in maintaining a solid credit culture in the face of potentially profitable but risky opportunities. Your bid sessions will be analyzed by instructors for lessons learned.
Case Studies
Apply various methods of loan evaluation to a real-world commercial loan application. Discuss management's role in the financials. Get a handle on the impact of business cycles on the applicant's financial status, and discuss the role of trend analysis and forecasting in making credit and underwriting decisions. Learn how you might price various loans in today's competitive environment.
Commercial Real Estate Lending
Hotels, convenience stores, churches, warehouses, manufacturing plants, office buildings—all are commercial properties. Understand how different types of properties require different analyses of loan repayment sources, whether from rent, business income, or other borrower cash flows. Understand the major credit risk areas in each property type, as well as the importance of administering and monitoring loans post-closing. See how various property types can help you maintain portfolio diversification.
Commercial Relationship Management
Cross-selling has long been an integral part of retail banking. It's a more recent development on the commercial lending side of the business. Cross-selling to commercial clients boosts revenue for the bank. The deeper the relationship, the greater the profitability. As a Commercial Lender, you are well familiar with the borrowing needs of your clients and how to structure the credit relationship. In today's competitive environment, you must be just as familiar with the transactional, investing, and long-range planning needs of your clients for their business, for them personally, and for their employees. Your role as a Commercial Relationship Manager is to discover diverse financial needs and assemble a sales team of internal business partners with the expertise to serve those needs. Commercial Relationship Management will provide a roadmap for honing your relationship building skills. You will receive practical tools for scheduling and planning contact with clients, documenting relationship information, engaging business partners, and monitoring your sales progress. This is an interactive session in which you will have the opportunity to try out tools and high impact sales techniques.
Effective Negotiations
Whether financing new business or refinancing current loans, build more lasting, profitable relationships with clients by applying a win-win strategy. Learn how to differentiate between relationship-based and transaction-based clients, how to construct successful options, ways to prioritize bank and customer needs, and techniques to present and negotiate offers most effectively. Negotiation planning worksheets used in class can be implemented once you return to your bank.
Evaluating Secondary Repayment Sources –NEW!
Good credit decisions depend on a logical identification of repayment sources. The big three— cash flow, collateral, and guarantors—offer various cushions of protection. Get tips on using each source to ensure your borrowers repay in full, on time, and with the terms you agreed upon at deal closing. Tools will be introduced to help you evaluate the repayment ability of all three sources and how to factor each into your underwriting models.
Inside the Industry: Regulatory Panel Discussion
Gain the knowledge to comply with critical new capital, appraisal, and regulatory requirements in a very changed marketplace. Speak with the regulators directly at this special panel, including officials form the Comptroller of the Currency, Office of Thrift Supervision, and the Federal Deposit Insurance Corporation. Understand lending challenges from a regulators' perspective, and get a better handle on how to address their inquiries and compliance requests. Ample time will be set aside for questions and your suggestions.
Managing Credit Quality
Commercial credit risk significantly impacts the financial performance of a bank, and factors into every commercial loan opportunity that comes across your desk. Understand how to analyze, structure, and monitor opportunities. Get quantitative and qualitative analytic tools and resources, so you can assess all key factors when you and your credit committee make decisions.
The Importance of Cash Flow
Examine the critical elements of the cash flow statement to determine the probability of a loan being repaid. Get introduced to a methodology for cash flow sensitivity analysis that focuses on the quality of various sources of cash flow. Understand the importance of examining historical cash flow statements as well as future, pro forma cash flows as indicators of the borrower's capacity to repay in full and on time.
Underwriting and Structure
How do you determine if borrowers will have enough cash flow to cover loan payments? Learn about the many ways to measure creditworthiness, using tools such as general repayment analysis and ratios, advanced cash flow and ratio analysis, and analysis of various types of financial statements, including interim statements. Understand how the borrower's industry, management, and other non-financial risks factor into your analysis. Find out how to move from conventional credit analysis to underwriting, documenting the policy exceptions and key risks. Discuss and contrast the credit analysis process with the underwriting process.
Program Manager Gloria Pritchard-Becker.
