A bank’s loan policy forms the foundation for regulatory performance with respect to both compliance and safety and soundness. Having sound and effective policies that are both manageable and measurable are critical in the current economic, regulatory environment. Banks need to be able to adapt and adjust as conditions dictate.
The first rule of policy analysis is that any changes will have both intended and unintended consequences. As such, it is critically important that institutions study and carefully craft policies in order to achieve desired goals while avoiding adverse effects of policy changes. Our firm has the experience and the necessary tools to enhance lending performance, correct deficiencies, foster continuity and consistency, and achieve the primary goal of reducing regulatory risk.
In our experience, many institutions that have been faced with regulatory challenges in regard to fair lending have, in a large part, been a direct result of flawed or outdated loan policies and procedures. Often banks are reluctant to make changes due to the uncertainty in the longer term this may create with respect to the impacts on the bank’s business model and overall lending performance. We understand these challenges and, therefore, take a holistic approach to policy formulation rather than a myopic view of addressing individual issues. Our proven approach helps institutions balance efficiency and risk.