3 Concerns examiners have with C&I lending
Sageworks analyst Libby Bierman and Sageworks risk management consulting staff recently conducted a webinar to discuss three concerns that bank regulators have voiced in recent months regarding increasing competitive pressures in the commercial and industrial (C&I) lending space.
In this video, Sageworks staff discuss the concerns, which center on:
- Inexperience with business entities: Examiners are worried about departments or individuals analyzing C&I for the first time. Have they had adequate experience or training?
- Improper global cash flow analysis: Financial institutions with previous concentrations in CRE or consumer lending might be unaccustomed to the global cash flow analysis necessary for C&I loans.
- Inadequate strategic planning: Are new policies and processes adequate to account for C&I lending? What is the institution’s risk appetite in C&I lending?
Watch the video below.
To learn more about what risks come with additional C&I loans and how a probability of default model can help, download the whitepaper titled: Shifting Credit Concentrations: 6 Ways to Prepare.