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Press Release
New Product Helps Serve SMEs Better: The Covarity Dashboard
(Kitchener, Ontario, January 10, 2005)
For commercial credit union lenders, the majority of borrowers represent SMEs (small
and medium sized enterprises) -- a market sector that is often underdeveloped in financial
skills and resources.
These lenders often find it difficult to gather timely financial reports, even from relatively
sophisticated borrowers. Currently, information is usually received in paper format and
requires input conversion on the part of the lending staff, so once the process is complete,
the information can be outdated. In addition, the amount of time consumed by processing
lessens the amount of time lenders have to establish valuable relationships with their
borrowers.
Now credit unions will have easier access to a tool that standardizes credit risk
management practices associated with loan review, monitoring and portfolio
management. The Covarity Dashboard was designed by Central in conjunction with
Covarity, a Waterloo software company. The SME lending automates financial
statement gathering, credit risk analyses and financial reporting for SME credit products.
The Covarity Dashboard also provides historical and future trending analyses for both
lenders and borrowers.
The tool offers significant savings by reducing the regulatory and administrative
processes associated with SME commercial portfolio management by retrieving financial
information directly from the borrowers' accounting packages in electronic format. It also
provides immediate, automated processing of the information and reporting on borrowing
parameters, financial ratios and covenants/compliance issues. The Covarity Dashboard
automates for lenders aggregated portfolio measurements such as industry diversification
or portfolio breakdown by branches.
By automating many of the monitoring and control functions, it provides effective
portfolio risk and time management tools. At the same time, it generates monthly
projections for both lenders and borrowers on a continuously adjusting basis. These
trending tools are provided in graph form for optimum usage.
With less processing time and more information being supplied, credit unions can now
take a proactive approach to enhance their customer relations. This type of approach to
SMEs offers credit unions an effective way to distinguish themselves within the SME
market, particularly at a time when most financial institutions are moving towards
automated formula lending with little client interaction.
The Covarity Dashboard enables credit unions to provide a more supportive and
prospective role to their borrowers. Members receive diagnostic and trending information
on a regular basis, which provides the groundwork for an ongoing and constructive
dialogue between borrowers and lenders. With automated monitoring processes for the
lenders, more time is available to nurture the relationship, solicit new business or focus
on problem areas. A more informed and responsive borrower will lead to reduced risk,
improved time management and enhanced yields for the credit union.
"Our first member upload was a complete success. It took my borrower minutes to upload
all of their information, and I was immediately able to assess how they were performing
against their covenants. It was easy for my borrower, it made my job easier, and I was
able to be more proactive with them," said Barb Everett, commercial account manager, Northern Lights Credit Union.
The software has been endorsed as a nationally branded credit management tool by
members of the National Lenders Advisory Committee (NLAC). Canadian Central has
agreed to share the licensing costs and to standardize the agreements across the system. A
system-wide agreement paves the way for credit unions across Ontario to quickly deploy
the The Covarity Dashboard solution and provide its benefits to their SME borrowers. It
also significantly reduces the delivery cost for each member credit union by enabling
them to access a common platform. However, each credit union can still customize their
product to accommodate their business rules and requirements. The The Covarity
Dashboard interface will be branded with their credit union's logo as will all
communications generated by the software.
The Covarity Dashboard was launched across Canada earlier this year and has been
activated in credit unions throughout Nova Scotia, Ontario, Manitoba and Alberta. The
deployment for both the credit union and the commercial member is both straightforward
and user-friendly with Covarity providing step-by-step support.
Andre Schroer is the director of commercial lending and product development at Credit Union Central of Ontario. On the web at http://www.ontariocreditunions.com.
About Covarity Inc.
Incorporated since 2001, Covarity is the leading provider of commercial loan management software solutions. The Covarity Dashboard helps financial institutions attract new business by harnessing the internet to improve customer service, while reducing the risk and effort associated with capturing borrower financial statement data and monitoring commercial loans. Please see http://www.covarity.com for additional information.
All company and/or product names are trademarks and/or registered trademarks of their respective owners.
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