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Risk Guidance on Commercial Real Estate Concentrations - Webinar

  • ID: 4342160
  • Webinar
  • March 2018
  • 90 Minutes
  • Lorman Business Center, Inc.
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Commercial real estate (CRE) and multifamily concentrations are an area of scrutiny for regulators in the current exam cycle.

The regulatory agencies have gone on record stating that concentrations are bank killers and that most of the banks that failed during the great recession were CRE Concentrated. Community banks due to their lending products and foot print tend to be concentrated by default, and need to recognize that managing concentration risk is a priority. Regulators are concerned that underwriting standards on CRE loans has loosened nationwide and will continue to be focused on in exams. Like in 2006, the agencies are issuing guidance on tightening CRE underwriting standards and enhancing credit concentration management.

This topic will discuss why concentration management is considered so critical to bank health, and what steps to put in place to ensure that proactive concentration management becomes part of a banks credit culture. We will take a holistic view of regulatory context, data management, credit policy and tools like stress testing to support effective CRE concentration management. Takeaways include a road map for the implementation of a successful concentration management program and a live demonstration of a successful CRE concentration based stress test. Ardmore Banking Advisors has been assisting community banks in effectively managing credit risk for more than 25 years, and is a nationally recognized thought leader in CRE credit management.

Learning Objectives
  • You will be able to review how to create a concentration policy.
  • You will be able to define CRE.
  • You will be able to describe credit data management to support concentration management.
  • You will be able to discuss CRE stress testing and sensitivity testing.
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Concentrations
  • Definition
  • Regulatory Context
  • Credit Risk Management Context
Creating a Concentration Policy
  • Value to the Institution
  • Key Components
CRE
  • Definition
  • Why CRE Is Emphasized by Regulators
  • Current CRE Market Metrics, Trends
  • Segmentation
  • Underwriting and Exceptions to Policy
Credit Data Management to Support Concentration Management
  • Concentration Coding
  • Concentration Performance Tracking and Reporting
CRE Stress Testing and Sensitivity Testing
  • Objectives
  • Techniques
  • Live Example
Summary and Conclusions
  • What Your Institution Needs to Do
  • Road Map
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Peter L. Cherpack - Ardmore Banking Advisors, Louis J. Dunham - Ardmore Banking Advisors
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This webinar is designed for attorneys, presidents, vice presidents, loan officers, loan department personnel, branch managers, credit and collections managers, real estate professionals, controllers, accountants and auditors.
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