Risk Rating - Hurdle Group

Commercial Banks Have Increased Credit Risk Standards

Posted on August 5, 2016July 6, 2018 by Alan_Lee

Commercial Banks need tools for loan pricing

Commercial Banks Have Increased Credit Risk Standards Commercial Loan Pricing Tools According to a report released by the Office of the Comptroller of the Currency, commercial banks have increased credit risk standards in approximately 30 percent of commercial loan products. This means that many banks will accept riskier ventures for financing and will relax some underwriting guidelines in ...

Getting the Most From Your Loan Pricing Model

Posted on September 4, 2015July 6, 2018 by Alan_Lee

Getting the Most From Your Loan Pricing Model Loan Pricing Model Banks price commercial loans in one of two ways. They either calculate their loan pricing based largely on what their competitors are doing and what current market conditions seem to indicate, or they make use of a loan pricing model. Choosing which option to use may initially seem fraught with difficulty. Proponents of tren...

Are You Using Your Loan Pricing Model Or Is It Using You?

Posted on June 12, 2015July 6, 2018 by Alan_Lee

Are You Using Your Loan Pricing Model Or Is It Using You? Loan Pricing Model Inputs Typically, for a commercial loan pricing model to work effectively, a concerted effort is involved. Since a one-size-fits-all approach is rarely truly useful, loan pricing software must be customized to specific goals and objectives of your bank. Assumptions must be set, Return on Assets (ROA) targets mus...

3 Components of an Effective Commercial Loan Pricing Model

Posted on December 19, 2014July 6, 2018 by Alan_Lee

3 Components of an Effective Commercial Loan Pricing Model Beyond using loan-pricing models to price loans, banks benefit from using models to differentiate the poorly priced loans from the well-priced loans offered in the marketplace. An effective Commercial loan pricing model requires three components: The bank should maintain pertinent data on fees, origination and cost of servicing thei...

What Is A Risk Rating?

Posted on December 12, 2014July 6, 2018 by Alan_Lee

What Is A Risk Rating? More and more loans are being granted every day. Before approving the next loan, ask yourself: is the risk worth the ROI? Where is the line between reaching portfolio goals and knowing when to walk away? Studies have been conducted to educate and encourage financial institutions to implement loan pricing models. These models are designed to incorporate the analytics req...