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Understanding How CRE Portfolio Stress Testing Works Using Methods and Models
Webinar
11 AM CT
Speaker: Peter Cherpack
Duration: 1 hour
Pricing:
$299 - Live, Download or CD
$249 - (for Affiliation Members)
$349 - Live + Download or Live + CD
The stress level for community bankers is about to rise another notch – literally. Federal regulators revealed recently that they are planning to introduce new guidance early next year establishing stress testing criteria specifically for community banks. It appears that smaller banks may no longer be exempt from the stress testing requirements that, until now, have applied only to the nation’s largest financial institutions. Will your institution be prepared to do the comprehensive analysis examiners will want to see?
Required or not, stress testing is a good idea for banks of all size – especially for community banks with significant exposure to commercial real estate loans. And stress testing of commercial real estate loan portfolios has become more sophisticated and more complex, as multiple market and valuation models have replaced the old spreadsheet analysis of the underwriting for individual loans. This webinar will explain how these new stress testing models work, identify industry best practices, and show you how to ensure that the stress testing you do provides the information and insights you need to understand your institution’s risk profile. This session will:
- Describe the various models and methods appropriate for
- Appraisal values;
- Interest rates;
- Income;
- Cap rates;
- Debt service; and
- Vacancy change
- Review the merits of different models and their applicability to specific CRE loan types
- Illustrate the impact of using different stress testing models on a sample portfolio
- Explain how to interpret the testing results
- Explain what regulators will want to see in bank reports of their stress testing results
BIO: Peter Cherpack
Senior Vice President, Principal, Credit Technology Solutions
Ardmore Banking Advisors, Inc
Peter provides over twenty five years of experience serving the banking market in information technology, operations, business analysis, strategic planning and high level project management. He specializes in Credit/Risk processes, systems and technology best practices. Peter delivers and supports the installation of Ardmore Banking Advisors’ credit portfolio management tools for banking institutions across the United States including CreditInsight and CREInsight. He is a subject matter expert on Commercial Real Estate, regulatory guidance and CRE portfolio stress testing and is a featured speaker at national banking events as well as authoring several articles on Commercial Real Estate portfolio management.
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