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  • Changing Banks is like Driving in Wales: How to make it easier

Lenders are changing banks right and left. Your bank is bought, merged or even seized by the FDIC. Now you have a new lending culture, guidelines and procedures to use. Even if you are a seasoned lender…


The Rules of the road have changed.

The first time I drove a car in Wales I had to get used to driving ‘on the wrong side’ of the road. I am an accomplished driver, but put the steering wheel on the right side of the car and everything changes.

The stick shift is now on the left, so I am shifting left-handed. I know how to drive a stick shift, but it is harder with my left hand.

I have to get used to a changing landscape as well. My experience driving throughout Great Britain is that people in cities everywhere park on the side of the road, even when there is no room. So you can be driving down the street and there really is only room for one car to pass. Ah, but there is now an oncoming car.

After trial and error, I learned that you flash your lights if you are going to give right-of-way to the other car, then as they pass you both wave. Ah, but both my hands were very busy what with the steering wheel and the stick shift. I finally perfected, driving with my right hand, shifting with my left, then moving my left hand to the steering wheel quickly so I could put my right hand out the window and wave cheerily.

Who knew driving could be that hard! It was like starting over.


Back to school…

When you change banks, they may be using different software. It is likely the guidelines are different, and even the risk culture. Their ‘sweet spot’ loan or customer type may be different. There is a lot to learn.

If you are the lender changing banks:

  • Be sure to ask about written guidelines, policies and procedures.
  • Find the time to learn the software.
  • Be wary of just ‘copying’ the approach of the last lender to work on the file. You have no idea if they knew what they were doing. Ask a senior lender whose files you should review for good examples of analysis.
  • Ask for training.

If you are the financial institution:

  • Think about how the new lenders learn the ropes. Make sure guidelines are well written and clearly communicated.
  • Take a look at that worksheet everyone is using. Is it an old one left over from a training years ago? Has it been updated?
  • Systemize training on tax return and financial statement analysis. Don’t wait for a lender to ask for training. When you are a new hire, you don’t know if it is okay that you don’t know and you are trying to make a good impression.

My online training is available year-round and the open-enrollment workshops three or four times a year. Consider either of those options as a way to get new hires trained to a system that works. Or bring me in-house now to get consistency back and ramp up your lender’s analysis skills to be up to the task as the economy continues to challenge financial institutions, your lenders and your borrowers.

It takes time

The first few days, it took four of us to drive. I was at the wheel and my main job was not to kill anyone. My husband was spotter, especially with roundabouts. He’d figure out when to pull out of it. One son in the back had the city map and was watching for the right streets and calling them off. The second son had the regional map in case we accidentally ended up out of the city. It was exhausting.

After awhile I got used to it. I only drove on the wrong side of the road once. And by the time I came across a city-sized bus on a one lane country road, I knew how to back up and get out of the way.

What guidelines, policies or processes do you need to learn or learn better?
Are there changes in risk, loan review and the ‘sweet spot’ due to the economy that you need to understand better to do the best job for your financial institution and your borrowers?

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Linda Keith, CPA

Linda Keith CPA is an expert in credit risk readiness and credit analysis. She trains banks and credit unions throughout the United States, both in-house and in open-enrollment sessions, on Tax Return and Financial Statement Analysis.
She is in the trenches with lenders, analysts and underwriters helping them say "yes" to good loans.
Creator of the Tax Return Analysis Virtual Classroom at www.LendersOnlineTraining.com, she speaks at banking associations on risk management, lending and director finance topics.