ABA Banking Journal - July 2011 - (Page 30)

feature story | CREDIT RISK MANAGEMENT Still on their guard T o the traditional C’s of credit risk management— character, cash flow, and collateral—many banks are adding others: change, communication, caution, and common mistakes to avoid. Even banks that fared well in recent years say they’re making changes and remaining on guard. Sound Community Bank, a $336 million-asset thrift in Seattle, was always fairly conservative, according to President and CEO Laurie Stewart. But when they saw the housing bubble begin to burst in other parts of the country, they reevaluated their credit policies. “We didn’t do anything crazy in concentrations [before the recession], but we were more casual in credits like home-equity loans, so we tightened up there,” she says. “We also added more layers of approval so more sets of eyes were looking at applications than in the past.” Recently, the bank’s executives reviewed their credit management policies and weighed whether, in light of improving delinquency rates, they should rethink their tightened standards. “We decided, no, that we want to err on the conservative side,” says Stewart. “Yet we are sensitive to our clients’ needs—both consumers and small businesses— so the other thing we did was to add a set of eyes to declined loans.” New tools, new procedures Sound Community Bank is among those implementing new software to help manage credit risks. Its choice was Sageworks, which helps with management of allowances for loan and lease losses (ALLL) by identifying certain loans that need attention. “That has saved us some personnel and enhanced our management of that piece and given us some better tools to talk to regulators,” says Stewart. 30  |  ABA BANKING JOURNAL  |  july 2011

Table of Contents for the Digital Edition of ABA Banking Journal - July 2011

ABA Banking Journal - July 2011
Contents
Chairman’s View
Editor’s Column
Bank Notes
The Economy
Inside family banks
Pass the Aspirin
Tech Topics
New gold standard?
Still on their guard
Compliance Clinic
Compliance Inbox
ABA Resources
First Person: Special Edition

ABA Banking Journal - July 2011

https://www.nxtbook.com/naylor/BAKS/BAKS0515
https://www.nxtbook.com/naylor/BAKS/BAKS0415
https://www.nxtbook.com/naylor/BAKS/BAKS0315
https://www.nxtbook.com/naylor/BAKS2/BAKS1014
https://www.nxtbook.com/naylor/BAKS2/BAKS0914
https://www.nxtbook.com/naylor/BAKS2/BAKS0814
https://www.nxtbook.com/naylor/BAKS2/BAKS0714
https://www.nxtbook.com/naylor/BAKS2/BAKS0614
https://www.nxtbook.com/naylor/BAKS2/BAKS0514
https://www.nxtbook.com/naylor/BAKS2/BAKS0414
https://www.nxtbook.com/naylor/BAKS2/BAKS0314
https://www.nxtbook.com/naylor/BAKS2/BAKS0214
https://www.nxtbook.com/naylor/BAKS2/BAKS0114
https://www.nxtbook.com/naylor/BAKS2/BAKS1213
https://www.nxtbook.com/naylor/BAKS2/BAKS1113
https://www.nxtbook.com/naylor/BAKS2/BAKS1013
https://www.nxtbook.com/naylor/BAKS2/BAKS0913
https://www.nxtbook.com/naylor/BAKS2/BAKS0813
https://www.nxtbook.com/naylor/BAKS2/BAKS0713
https://www.nxtbook.com/naylor/BAKS2/BAKS0613
https://www.nxtbook.com/naylor/BAKS2/BAKS0513
https://www.nxtbook.com/naylor/BAKS2/BAKS0413
https://www.nxtbook.com/naylor/BAKS2/BAKS0313
https://www.nxtbook.com/naylor/BAKS2/BAKS0213
https://www.nxtbook.com/naylor/BAKS2/BAKS0113
https://www.nxtbook.com/naylor/BAKS2/BAKS1212
https://www.nxtbook.com/naylor/BAKS2/BAKS1112
https://www.nxtbook.com/naylor/BAKS2/BAKS1012
https://www.nxtbook.com/naylor/BAKS2/BAKS0912
https://www.nxtbook.com/naylor/BAKS2/BAKS0712
https://www.nxtbook.com/naylor/BAKS2/BAKS0612
https://www.nxtbook.com/naylor/BAKS2/BAKS0512
https://www.nxtbook.com/naylor/BAKS2/BAKS0412
https://www.nxtbook.com/naylor/BAKS2/BAKS0312
https://www.nxtbook.com/naylor/BAKS2/BAKS0212
https://www.nxtbook.com/naylor/BAKS2/BAKS0112
https://www.nxtbook.com/naylor/BAKS2/BAKS1211
https://www.nxtbook.com/naylor/BAKS2/BAKS1111
https://www.nxtbook.com/naylor/BAKS2/BAKS1011
https://www.nxtbook.com/naylor/BAKS2/BAKS0911
https://www.nxtbook.com/naylor/BAKS2/BAKS0811
https://www.nxtbook.com/naylor/BAKS2/BAKS0711
https://www.nxtbook.com/naylor/BAKS2/BAKS0611
https://www.nxtbook.com/naylor/BAKS2/BAKS0511
https://www.nxtbook.com/naylor/BAKS2/BAKS0411
https://www.nxtbook.com/naylor/BAKS2/BAKS0311
https://www.nxtbook.com/naylor/BAKS2/BAKS0211
https://www.nxtbook.com/naylor/BAKS2/BAKS0111
https://www.nxtbook.com/naylor/BAKS2/BAKS1210
https://www.nxtbook.com/naylor/BAKS2/BAKS1110
https://www.nxtbook.com/naylor/BAKS2/BAKS1010
https://www.nxtbook.com/naylor/BAKS2/BAKS0910
https://www.nxtbook.com/naylor/BAKS2/BAKS0810
https://www.nxtbookmedia.com