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Risk Management Training Program

Loan Analysis School

Program Overview

Loan Analysis School introduces participants to the loan review process. Through a combination of computer-based instruction and participation in a related skills-practice workshop, participants learn how to review and classify individual loans. Specifically, participants learn how to analyze financial statements, calculate and interpret cash flow, and assess the appropriateness of loan structure, pricing, and documentation. Participants analyze a series of loans, prepare for and conduct loan discussions, make loan classification decisions, and compose loan write-ups.

Key Objectives

Upon completion of this course, participants will be able to:

• Review a loan file for creditworthiness
• Analyze financial statements
• Document any weaknesses or issues on a loan line sheet
• Prepare for, and conduct, a loan discussion
• Determine appropriate loan classification
• Prepare a loan write-up using the 6 P format
• Identify apparent violations of lending laws, rules, and regulations

Instructional Format

Computer-based instruction, facilitated classroom discussion/lectures, and small group activities.

Duration

This school consists of a 20 hour precourse computer based instruction and a two week instructor led workshop.

Level

Basic

Target Audience

The course is designed for RMS Risk Management assistant examiners (associate and pre-commissioned) who generally have 24 months of risk management bank examination experience. Participants must have demonstrated competent performance in balance sheet analysis, investment portfolio analysis, earnings analysis, internal routines and control analysis, Call Report analysis, and Uniform Bank Performance Report analysis. This also includes unassisted preparation of Report-quality comments for Capital, Earnings, Liquidity, and Sensitivity to Market Risk. Participants must have a firm working knowledge of Microsoft Word and Excel, and be able to work effectively in a team environment.

Note: The minimum interval between the Asset Liability Management School and the Loan Analysis School is four months.

This course is open to appropriate staff of the FDIC and partner government regulatory agencies. This course is not open to the public or staff of private banks.

Prerequisites

Under the guidance of an experienced examiner, students must have participated in the following loan-related activities:

• Reviewed the documentation contained in a typical commercial loan file
• Observed a loan discussion
• Read several loan write-ups included within a Report of Examination and discussed the write-ups with an experienced examiner (minimum of two)
• Prepared practice (or actual) write-ups (minimum of two)
• Read the Loan section of the Risk Management Manual of Examination Policies

Pre-Course Assignment

Prior to attending the workshop, students are required to do the following:

• Complete the Commercial Loan Analysis computer-based instruction modules and successfully pass the Workshop Qualification Examination.
• Complete the Participant Profile.

Special Requirements

Participants will need to bring a Hewlett Packard 12-C financial calculator or its equivalent to use during class. Additionally, bring your work assigned laptop, and cable lock. The laptop needs to have loaded the following programs for use in the class: Microsoft Word, Microsoft Excel, Microsoft PowerPoint, and Adobe Acrobat.

Post Course Recommendation

The participants should review and discuss loans at several upcoming examinations, as well as be given the opportunity to prepare loan write-ups to reinforce skills learned at this school.

Post Course Feedback

A written assessment of the participant's performance is submitted to each participant's field supervisor or district office approximately 30 days after the conclusion of the school.

Credits

Continuing Education Unit (CEU): 7.0
Continuing Professional Education Unit (CPE): 83.5

For more information concerning course content and administration, please contact Senior Bank Examination Training Specialist Judy Long at julong@fdic.gov or (703) 516-5534 or Kristine Fisk at kfisk@fdic.gov.

More Information

For information regarding administrative policies such as complaints and refunds, please contact Corporate University, Attn: NASBA Representative Ava Livas, Room A-3025, 3501 North Fairfax Drive, Arlington, VA 22226 (703) 562-2463.

The Federal Deposit Insurance Corporation is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: NASBARegistry.org

The FDIC has been approved as an Authorized Provider by the International Association for Continuing Education and Training (IACET) (www.iacet.org), 1760 Old Meadow Road, Suite 500, McLean, VA 22102.

 

For more information concerning course content and administration, please contact Senior Bank Examination Training Specialist Robert Shingleton at (703) 516-5672 or Petra Nelson at (703) 516-5491.