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#2029671 - 07/24/15 06:57 PM Risk Rating on Loan Account
Patrick Lee Offline
Junior Member
Joined: Jul 2014
Posts: 25
Rosemead, CA
Currently our bank utilizes the occup/business code as one of the criteria in determining the risk rating performed by Banker's Tool Box (BAM) on all of the deposit accounts. We do not input occup/business code on loan accounts; therefore, the loan account in BAM does not include this criteria when calculating the risk rating for loan. I don't think this is wrong since credit risk was performed during the underwriting review.

I like to know what others are doing and whether it is normal practice not to perform risk rating on loan account since the credit risk was already performed?

Thank you!

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#2029673 - 07/24/15 06:59 PM Re: Risk Rating on Loan Account Patrick Lee
rlcarey Online
10K Club
Joined: Jul 2001
Posts: 83,005
Galveston, TX
Most banks risk rate at the customer level and not at an individual account level.
The opinions expressed here should not be construed to be those of my employer:

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#2029797 - 07/27/15 01:19 PM Re: Risk Rating on Loan Account Patrick Lee
BC78a Offline
Gold Star
Joined: May 2006
Posts: 311
New York
Our loan take the risk rating of the deposit account relationship; however, if in doing the credit review, the credit officer finds any information of concern, it is referred to BSA and the risk rating of the entire relationship will be increased.

In other words, we risk rate at the customer level, but will adjust based on what we finds out during the loan on-boarding.

Just my opinion for what it is worth

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#2029802 - 07/27/15 01:26 PM Re: Risk Rating on Loan Account Patrick Lee
Elwood P. Dowd Offline
10K Club
Elwood P. Dowd
Joined: Aug 2001
Posts: 21,939
Next to Harvey
Accounts aren't risky; customers are.
In this world you must be oh so smart or oh so pleasant. Well, for years I was smart. I recommend pleasant.

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