Stress testing and capital planning are important for financial institutions in good times, but they are even more important in times of economic uncertainty. With the right support in changing conditions, banks and credit unions can provide top stakeholders with a range of expectations and quickly develop contingency plans.
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Scenario Analysis & Planning Solution
Proactively understand your portfolio’s behavior.
Pinpoint your risks.
Stress test results can help inform decisions in other risk areas, such as the ALLL/CECL, asset/liability management, valuation, and more. Satisfy examiners with multiple types of analysis, and easily identify different trouble spots at your bank or credit union.
Features and Functionality of Abrigo Stress Testing
Stress test different levels in your portfolio.
Abrigo offers banks and credit unions an easy-to-use stress testing platform that you can leverage to quantify different types of risk under a variety of scenarios.
Identify risk at different levels, with borrower-, concentration-, and institution-level stress tests.
Duplicate and edit scenarios to run stress tests at different severity levels in one analysis.
Use key factors: interest rate, cash flow, and collateral value to model different environments.
Improve strategic planning and easily manage capital ratios to evaluate safety and soundness.
Create reports to effectively communicate risk to management, the board, and examiners.
Use forecast models to view ranges of outcomes on future ALLL levels and periodic losses.
"Abrigo Stress Testing is an efficient way to stress different levels of our portfolio. Since purchasing the solution, examiners have been very happy, making life easier for us. "
Kristen Beggs, West Texas National Bank
Advantages of Abrigo Stress Testing
Keep stakeholders informed with the
power of a single system.
Identify all potential risks that management and examiners need to know about with Stress Testing. A single connected system enables proactive behavior and increases efficiency within your risk management program.
Stress any loan in the system, including CRE loans, using one platform. Fully integrate with other Abrigo solutions, such as Sageworks ALLL, Sageworks Insights, and more to get a seamless view of data across your institution.
Satisfy your board, management, and examiners with a borrower or economic-based stress test. Identify potential trouble spots in the portfolio for risk management to stay prepared.
Leverage economic-based scenarios to make more informed capital planning and lending strategy decisions based on stress results. Reduce manual tasks through monthly archived data and automated calculations.
Streamline Your Process
“The other thing that helped us was that we were using the Abrigo Stress Testing model. Because of that, we were already putting in additional data on debt service coverage, so when Abrigo ran our CECL data assessment, there wasn’t a lot of information that we had to go back and fill in.” Read More.
Andrew Reid, Executive Vice President and Chief Credit Officer, Bank of San Antonio
Integrated Systems with Abrigo
Gain more data efficiency at your institution.
Entering the same data inputs for multiple risk analyses at your institution can be both time-consuming and laborious. With our interconnected systems at Abrigo, users only have to enter information once. Different functions that were once siloed can now seamlessly integrate with each other, all within one trusted platform.
Abrigo Asset/Liability Management Model
Abrigo Asset/Liability Management (ALM) is a web-based model designed to help you optimize net interest margin, assess risk exposure, and develop contingency funding plans. The Abrigo ALM model fully integrates with other Abrigo solutions, such as Stress Testing and Sageworks ALLL.
Resources on Stress Testing
Portfolio Stress Testing
The need for stress tests to understand current risks is critical for community institutions.
Your economic stress testing estimates can help to inform your CECL calculations.
Stress Testing Best Practices
Stress programs should consider their tests on a one-year time horizon measured in mild/severe scenarios.