Publications & Resources

May/June 2008
Focus: Mergers & Acquisitions

WIB Service Corporation Update
See Your Portfolio’s Risks Clearer with WIB-Endorsed Inmatrix

By Anne K. Scully, President, WIB Service Corporation

“I can see clearly now, the rain is gone,
I can see all obstacles in my way
Gone are the dark clouds that had me blind
It's gonna be a bright (bright), bright (bright)
Sun-shiny day.”
- Johnny Nash - I Can See Clearly Now

All assessments are not created equal in the world of  projecting credit risk. Community banks that don’t employ a forward-looking, market-based analysis may be exposing their institutions to financial risk and regulatory criticism. Accounting standards are lagging indicators; by the time they reflect shocks, the damage is done.

As a result, stress testing has become a strongly recommended means to approximate the "unexpected loss" in a bank’s portfolio – from concentrations and correlations among borrowers in the same segment to estimated reserve provisioning, ALLL and ensure regulators of Capital Adequacy.

WIB-endorsed VIP Inmatrix can help your bank manage its portfolio. It offers community banks powerful, cost-effective and easy-to-use software to analyze, stress test and manage the credit risk of your entire portfolio, sub-portfolios and even a single credit.

Optimist – Inmatrix’ flagship product  is the only spreading and credit analysis tool that simultaneously allows you to manage risk in your Commercial & Industrial (C&I) and Commercial Real Estate (CRE) portfolios. Its one page financial credit risk “dashboard” enables you to instantly stress test cash flow and other key financial performance measures, analyze projections, model business scenarios (‘What If?’) and test strategies that lead to desirable business results. Credit management is augmented through integration of RMA Statement Studies to compare accounts with industry benchmarks.

Managing Risk Across Both C&I and CRE Portfolios – Optimist provides a wide range of ‘worksheets’ that provide focused analysis on construction projects, income producing property, and property development deals. All worksheets are integrated within Optimist reports, and can be packaged for seamless inclusion in your own credit approval document.

CRE Emphasis – Satisfy regulators by providing greater consistency in forms, templates and access to data, including CRE related schedules (construction draw, tenancy, sub division release etc.). Since all relevant CRE information is maintained within one central database, you have instant access to information by customer, or on a deal by deal basis.

Optimist Offers Front-End CRM Capabilities – Optimist provides front-end relationship management tools that expand your bank’s reach as a trusted financial advisor to prospective and current customers. With Optimist, your bank can differentiate itself from the competition by helping clients understand quickly and succinctly the impact various decisions will have on their businesses and determine the optimal path to increase business results and achieve the objectives sought.

“With Optimist, our ability to do “what ifs” with our business customers provides them with real value and differentiates us from the competition.”  Park Price, President & CEO, Bank of Idaho

Portfolio Strategist – Portfolio Strategist provides scenario modeling to identify deteriorating credit as well as portfolio trend analysis, benchmarking, and stress testing at the industry, portfolio or sub-portfolio levels. The Result: Improved credit quality plus enhanced revenue and profitability.

Portfolio Strategist is compatible with information from numerous third-party systems.  \Your bank’s internal risk-rating system can be integrated with Portfolio Strategist as well.

Meet CRE Guidelines with Portfolio Strategist

  • Proactively monitor CRE portfolio risk: identify and manage concentrations, perform market analysis, and stress testing.
  • Identify CRE exposures
  • Conduct risk migration analysis: identify changes in your portfolio’s risk profile as well as early warning signs of emerging weaknesses.
  • Generate critical reports and loan documentation.
  • Target CRE concentrations and develop watch lists to highlight those that breach credit policy.
  • Assesses a borrower’s/property’s sensitivity to macro economic and project-specific changes (variations in vacancy and rental rates, interest rates, and inflation rates).
  • Determine underwriting standards and the ability to monitor portfolio metrics.

WIB Member Benefit:  WIB Members receive pricing and implementation discounts.

For more information, contact Judy Slimm at jslimm@inmatrixinc.com or (415) 362-7900.

Unauthorized reproduction of all or part of this material without the express written consent of the author is strictly prohibited. All rights reserved.