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Due
diligence examinations:
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Fitzgerald Financial can rapidly assemble teams of highly skilled credit examiners to
provide quick and comprehensive due diligence to meet your needs. Whether you are considering an acquisition of a bank, a
portfolio or even a sale of your institution involving a stock swap, Fitzgerald Financial has the experience and expertise
that you need. In addition to providing you with a highly skilled assessment of the inherent credit risk, we can provide you
with an objective assessment of the target's management.
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Fitzgerald Financial provides credit and loan review services on a fully outsourced
basis in addition to spot reviews as requested. Fitzgerald Financial believes that outsourcing the credit review function
to a qualified vendor enhances risk management because it brings in expertise that is usually not available in-house. Further,
a qualified vendor, such as Fitzgerald Financial, sees a much broader spectrum of credit risk than what can be viewed
by an in-house staff, so it is much more likely that undue risk will be identified at an early stage. Finally, a qualified vendor
is able to identify areas where “best practices” could be considered in an effort to enhance your institution's
risk management.
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Policy
& procedure development:
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Policies and procedures should be reviewed on an annual basis to
ensure that they are up to date, reflect current practice, and are in compliance with ever changing regulatory requirements.
Joe Fitzgerald has drafted and reviewed scores of credit policies for numerous clients during his career.
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Credit
process design & enhancement:
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Highly competitive credit markets create a slippery slope
of price reductions and waivers of traditional credit requirements in an effort to obtain loan growth and retain existing
customers. However, these actions will ultimately create future credit and earnings problems. Credit policies
alone are not enough to ensure sound operations if they are not supported by a strong credit culture. To maintain
a strong credit culture, credit policies need to be supported by qualified personnel and a strong credit process. Fitzgerald
Financial is eminently qualified to assist your institution in ensuring a credit process that meets your needs.
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Credit
risk rating systems:
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In today’s highly competitive credit markets, robust credit
rating systems are critical to success. Institutions cannot afford to take a laissez-faire approach to credit quality.
Unfortunately, most commercial banks still maintain highly subjective, 10-point rating systems, where most credits are rated
within one or two categories. The largest international banks have implemented credit rating systems that greatly enhance
granularity to comply with the requirements of Basle II. While smaller banks do not need to comply with Basle II, credit
rating system enhancements should be considered for competitive and risk management reasons. Fitzgerald Financial has
implemented rating systems for clients that include objective criteria to determine both borrower and financial ratings that
enhances the objectivity of the rating process, improves risk identification, aids in auditing risk ratings, and complies
with regulatory requirements.
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Allowance
for Loan & Lease Losses (ALLL) methodology & model validation:
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Over the past twenty years, the ALLL has become a focal point
for both examiners and accountants. It is generally one of the highest priorities in both a regulatory examination
and a financial statement audit. And, although there are no RAP/GAAP differences, the regulatory examiners and accountants
are often at odds in relation to this account because regulatory examiners consider capital adequacy of utmost importance
while accountants are more concerned with the accuracy of reported earnings to shareholders. Fitzgerald Financial has
the experience to help you navigate the pitfalls that banks often face in developing their methodologies. Joe Fitzgerald
has personally assisted scores of institutions with their ALLL methodologies and model validations in addition to providing
litigation support and expert witness testimony on the subject.
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