Solution Overview

Benefits

Portfolio Management - Best Practices

Covarity Overview

Covarity offers a hosted, web-based commercial loan portfolio management solution that enables banks to mitigate credit and operational risk and prepare for regulatory scrutiny fast and efficiently with minimal capital outlay.

Covarity enables banks to:

• Improve Risk Management - Improved loan management enhances data quality and analytical abilities, which allows banks to monitor early warning signs and mitigate credit and operational risk and ensure compliance with regulatory pressures.
• Increase Overall Portfolio Performance - Covarity delivers a consistent framework for tracking financial data, spreading and covenant analysis, and borrowing base analysis, which leads to improved risk management measures. This translates into a healthier portfolio, reduced loan losses and more efficient capital allocation and management.
• Streamline the Commercial Lending Process - By delivering process efficiencies and productivity gains through reduced data entry and automatic uploads, the Covarity solution helps banks ensure long term profitability and competitiveness.
• Build a Long-Term Portfolio Management Platform - Covarity delivers more than just a solution to current regulatory and market demands. The Covarity platform is part of a bigger picture that includes data analysis and reporting, and integration of your banks entire portfolio management process. And, by giving your borrowers visibility into the same ratios and metrics used to evaluate loans, Covaritys solution can improve a borrowers business, enhance your relationship and differentiate your bank by increasing the value you deliver to your commercial customers.

As a condition of credit, commercial borrowers typically must regularly submit their financial statements to their lender for a performance review. Currently, most small and mid-size enterprise borrowers print their financial statements (Income Statement, Balance Sheet, AR/AP, tax returns, etc.) from their accounting systems. The borrowers then mail, fax or hand deliver these statements to their lender, who reviews the performance of the loan and monitors the financial institutions exposure to risk. The loan review process at most financial institutions is manual, resulting in financial institutions typically spending several thousand dollars worth of staff time reviewing each loan each year. As well, with manual review processes lenders and managers have little or no visibility into overall portfolio performance and risk levels. By giving account managers, credit analysts and borrowers an easy-to-use, web-based tool that helps automate cumbersome reporting and monitoring processes, Covarity gives financial institutions a simple way to improve risk management frameworks, while also greatly reducing the administrative burden of loan monitoring and improving the level of service provided to borrowers.

The Covarity Dashboard solution supports the workflow and risk management decisions that comprise loan and lending portfolio monitoring, after credit origination decisions have been made. While there exist many software tools designed to address the origination decision process, financial institutions have not had access to a commercially-available tool designed to support the subsequent loan monitoring and associated risk management decision process.

To learn about how the Covarity solution enables best practices in portfolio and risk management,
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