Commercial Lending Review articles from July 2003

Commercial Lending Review archives from July 2003

Accounting clues to management quality.
July 1, 2003... Accounting has suddenly become a popular subject for seminars, speeches, even cocktail parties. Thanks to the recent spate of accounting scandals that continues to dominate the business press, accountants are no longer depicted as arcane...

Adapting risk management to protect the enterprise.
July 1, 2003... The convergence of regulatory, legislative, technological, and competitive pressures on financial services companies has broadened the focus on effective risk management in our industry. Every key stakeholder group has amplified its questions...

Risk implications of credit derivative instruments.
July 1, 2003... Credit derivatives (CDs) have grown from less than $200 billion in 1997 to more than $2 trillion in 2002. Furthermore, they are projected to more than double by 2005 and represent the fastest-growing segment of the credit market. Initially used...

Proper loan structure requires coordination of multiple areas of law.
July 1, 2003... The recent case of Preferred Funding Inc. v. Jackson (1) provides an excellent illustration of the importance of understanding and coordinating multiple areas of law to properly structure even simple loans. In Preferred Funding, the lender lost...

New technology for credit review.
July 1, 2003... A bank may embrace technological changes for any number of reasons. It may be that the company has gone through a cultural change, perhaps as a result of new management. The availability of new technology may provide avenues enabling the...

Case study: best practices at Hibernia National Bank. (Loan Review).
July 1, 2003... I always begin any discussion of the concept of best practices in bank loan review with the statement that what works best in one bank may not be completely applicable to another bank. What works has to take into consideration the risk...

Noncredit public record data for credit decisions. (Small Business).
July 1, 2003... Recently, sophisticated predictive models based on public-record identity verification and other noncredit data sources have been developed to complement and improve the performance of the traditional credit scoring that financial institutions...

Consolidation of variable-interest entities. (Accounting).
July 1, 2003... The Financial Accounting Standards Board (FASB) recently issued Interpretation No. 46, "Consolidation of Variable Interest Entities," to clarify the application of Accounting Research Bulletin (ARB) No. 51, "Consolidated Financial Statements,"...

Call preparation for the technology industry. (Relationship Management).
July 1, 2003... Many consider technology to be one of the toughest industries to bank, despite the excellent opportunity that may exist with technology companies. Commercial bankers are often intimidated while calling on these companies because they do not...