Credit Infrastructure Advisory for
Banks and Companies Outside of Financial Services
Credit Risk & Accounts Receivable Framework (First Line of Defense)
Build Credit Review Departments (Third Line of Defense)
Credit & Accounts Receivable
Representative Activities
Strengthen the 1st Line of Defense – Partner with stakeholders to address gaps, set desired objectives, and implement continuous improvement activities:
- Credit Framework – Developed User Guides, Credit Policies, and new risk rating scorecard
- Credit Approval – Established counterparty and sovereign approval protocols, and enhanced reporting procedures
- Legal Documentation – Developed bank-wide standards for Commercial Loan Documentation to reduce risk, achieve documentation consistency, support workout teams, and enhanced utilization of outside law firms. Implemented procedures and trained colleagues.
- Processes – Implemented best practices under new policy covering end-to-end risk processes; revealed unrecognized systemic credit risks.
- Portfolio Assessment – Developed a strategic risk management approach to identify and monitor the credit portfolio. Quarterly reporting to identify and track risk migration, including high risk exposures.
Credit Review
Representative Activities
Enhance credibility of the 3rd Line of Defense – Evaluate, develop, and implement Credit Review functions to provide actionable insights that align with an organizations risk tolerance:
- Credit Review Leadership – Implemented Credit Review programs in community and mid-size banks requiring significant process and culture change, including modifications to policies, procedures, staffing, and scope.
- Activities included:
- Substantial process reengineering
- Development of procedure manuals
- Deployment of exam software
- Credit review department and bank-wide cultural shift
- Reduced exam cycle-times for more timely insights
- Regulatory Confidence – Increased breadth, depth, and speed of exams to provide management with holistic risk reporting. Provided multiple regulators with confidence in the third line of defense and removal of MRAs.
- Bench Depth – Established skill development protocols of examiners and rotational opportunities that increased demand for CR officers.
Credit Training
Representative Activities
Align skills and expectations across the enterprise – Assessed Strengths, Weaknesses, Opportunities, and Threats (SWOT) to identify knowledge and cultural gaps compared to expectations of strong credit underwriting programs.
- Developed curriculum of both qualitative and quantitative subjects
- Delivered presentations
- Judged case competitions