The managing partners at Artisan Advisors are especially qualified to help their customers with their loan review requirements due to their many years as banking executives. Our organization brings a unique perspective to loan reviews, one that is much more in depth and comprehensive than general financial consultants or accountants can provide. Our loan review services are done for bankers, by bankers.

Why Conduct a Review?

There are a number of reasons why a community bank will conduct a loan review:

  • Regulatory requirement.
  • Request from Board of Directors.
  • Anticipation of a bank sale or merger – Due diligence.
  • Best practices.
  • Other loan risk considerations.

Services

Our loan review services are very customizable and can be tailor fit to the unique business needs of any community bank.  Here are some of the key areas our process will evaluate.

Risk Quality & Structure

Our highly experienced team will assess the overall risk quality of the bank’s loan portfolio from a variety of perspectives. In addition, we will evaluate the strength and consistency of the bank’s credit underwriting. 

Asset Quality

Loans, both consumer and commercial, make up the majority of revenue-producing assets on a bank’s balance sheet and, as a result, require a high level of management’s attention. Our loan review philosophy is derived from years of credit origination and approval experience. We assess the borrower’s historical financial and payment performance and estimate the borrower’s ability to perform going forward based on available information. We also assess how well the bank structures its loans and identify important technical exceptions. 

Risk Rating System

Most community banks have developed their own loan rating system, whereby they assign a risk factor to each loan based on established credit risk criteria. The managing partners at Artisan Advisors have extensive experience developing and evaluating risk rating systems. Our loan review will not only assess the integrity of the bank’s credit risk rating program as a whole, but also how accurately individual loans are being assigned rankings, based on the bank’s loan risk definitions. 

In addition, we will also evaluate how consistently a bank is following its own rating polices. It is very critical for a bank to always bear in mind that its loan rating system can directly affect the level of its allowance for loan and lease losses and overall capital reserves. 

The loan review services provided by the banking experts at Artisan Advisors are conducted at both the micro and macro levels. Our evaluation will assess a meaningful sample of individual borrowers as well as the composition and concentration of the entire loan portfolio. Our process gives community banks the benefit of seeing their book of business from both an aggregate perspective, as well as at the detail level.

We provide a comprehensive report summary to our bank customers with the loan review findings, as well as any recommended action steps for necessary changes. One of the main objectives of our loan review program is to help our customers develop the most effective and accurate risk rating systems possible. Following our loan review efforts, our bank clients find themselves in a much better position to gauge the risk levels of their loan portfolios and justify the integrity of their rating systems.

The loan review process is a critical part of ensuring that your bank’s business objectives are on the path to success. Let the highly experienced partners at Artisan Advisors put their unique expertise to work in your lending operations. 

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Expert Consultative Services For Bankers By Bankers

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