Print This Post

Stress Testing Effeciency

Madison has been quite successful setting up custom stress test reports and analysis for clients. It seems that every organization looks at stress testing a little differently and therefore needs a solution that can be tailored to their specific requirements. Here is an example of a stress test report that we set up for a client. It took between 4 and 8 hours to prepare the stress test from their systems but only seconds once the Stress Test was set up in Madison.

Here is what they wanted to do.

  1. Look at the portfolio of commercial real estate loans based on four scenarios: the current portfolio with no stress, a 5% stress, a 10 % stress and a 15% stress.
  2. Create one set of stresses based on LTV and another set based on DSCR.
  3. For each stress scenario and for both LTV and DSCR separately, show the results broken out by three stressed ranges from least affected to most adversely affected.
  4. Group the data by the region in which the collateral was located.
  5. If a multi property loan had collateral in more than one region, allocate the loan balance to each region based on the most recent collateral value.

We set this up in a single report that presented all the information requested with the simple click of the mouse. It took seconds to produce rather than hours.

In addition, as additional value-added to the report:

  1. Results could be grouped by many other factors in addition to region – collateral type, loan purpose, loan type, loan officer, loan office, etc.
  2. By clicking to display audit details, all the loan-by-loan details were displayed so that the user could verify accuracy and understand how individual loans were treated. And most importantly, these results let the user see the loans that were most adversely affected by the stresses.
  3. An option also allowed the user to change the scenarios from 5% increments to any other increment they desired.

Stress testing is important, but bankers should be spending their time evaluating stress test results, not manipulating raw data to create the analysis. This custom report allowed the client to do just that.

Print This Post

Loan Checklists – Manage Tasks More Efficiently

Many tasks must be completed during loan origination. A large number of documents must be assembled, certain functions need to be completed, analysis must be prepared, approval packages assembled, various approvals and sign offs completed, etc.

To help manage this process the Madison commercial loan software provides a convenient checklist feature.

  • First, you may specify an unlimited number to checklist types such as checklists for various loan types, or collateral types, or loan process steps.
  • Second, for each checklist type you may specify the default list of tasks that users will see when they open the checklist.
  • Third, you may allow (or not allow) users to add or delete checklist tasks for a particular loan so that the tasks are just what needs to be completed for that loan.
  • Fourth, when tasks are completed, users can check them off as being completed, enter the completion date, and enter any comments that are appropriate.
  • Fifth, to enable a tickler report, users can identify a future completion date and it will appear on a tickler report. The tickler report list tasks by date and highlights in red tasks that have passed their completion date and in yellow for tasks that are within 7 days of completion.

The check list feature can be shared by all users on a view only or edit basis, as appropriate for each user. You no longer need to call and play phone tag or send emails to find out the status of task for each loan. Instead, users can go to the checklist reports or checklist module and see the status of each loan.

Print This Post


Each time clients import data from their core system they will want to reconcile totals in Madison to totals in the core. Madison helps this process in two ways.

First, if loans in the import file could not be imported, Madison provides a list of each loan, collateral or borrower that could not be imported along with the reason why it was not imported so that user can easily identify and correct import errors. When that step is done, totals in Madison should be the same as totals in the core.

Second, but that may not always be the case. The import file may not have included a loan or two that should have been in the file. Or some loans that should have been marked as paid off may not have been marked. Issues such as this give rise to reconciliation differences.

To assist in identifying the source of the difference it is useful to present lists and subtotals of loans in Madison that match similar lists and subtotals in the core. For example, most core systems have groupings of loan types that may be called class codes, minors, or other terms that signify a very granular grouping of loans. Madison often has these values in the loan category field so that reports can be grouped by loan category and then the subtotals compared to comparable subtotals in the core to discover the source of the difference. Since there is often a much small number of loans in these grouping it is much easier to identify the source of the difference.

Print This Post

Increase Productivity with Information Sharing

While an important reason for the acquisition of a commercial loan system is the need for better risk management analytics, the impact on productivity should not be overlooked.

With commercial lending, many hands will touch a loan from origination through closing and on to portfolio administration and risk management. In many cases, each set of hands looks at a loan from its own perspective associated with its business function. The information that each set of users wants to see about a loan will be different and the work or analysis that they perform will differ.

Consequently it is not uncommon for each set of hands to rekey information about the loan into a Word document or Excel spreadsheet or Access database. Each time the same information is rekeyed, efficiency is lost.

And when one set of users wants to see information that has been assembled by another user or group of users, the information is requested often by email or a voice mail, with hours or days lost as one person finds time to pass on information to another person. Time lost further reduces efficiency.

The ability to provide effective reporting is diminished when little information resides in a central database so the time is devoted to pulling together information from many sources to support reporting requirements and portfolio risk management analysis.

Operating with information in a central, shared database can have a significant positive impact on productivity. Information can be accessed more quickly, reports prepared more efficiently, and risk management analysis performed that could not have been performed if data were scattered throughout the organization. Productivity can be further improved by metrics that display the time required to complete each step in the lending process and productivity measures such volume per person.

Print This Post

Loan Origination Productivity

Loan Origination Productivity

Loan Origination ProductivityOverview: There are many ways to measure the productivity of the loan origination process. One dimension is the time that is required to complete each step in the process. This information can assist in identifying bottlenecks so situations can be resolved before they become problems.

The Loan Origination Productivity Report calculates and displays the time that was taken to complete each step in your origination process for each loan. The information can then be grouped by a large number of variables (about 24) to assiste in understanding potential problems and their causes.

For example, the report can group loans by loan origination program so you can quickly and easily identify programs that take longer to complete than they should, or steps in origination process for those programs that do not meet your timing standards.

Or information can be grouped by loan officer to see if some are able to close loans faster than others. Maybe the “experts” can give some guidance to those that take longer to close their loans.

The report allows a senior lending officer to easily stay on to of the effeciency of the entire loan origination process so that management iniatives can be implemented where needed. Since time is money, this report provides valuable insight into the origination process.

Print This Post

Saving and Sharing Documents

Saving and Sharing Documents

Saving and Sharing DocumentsOverview: So where do I save the documents that I accumulate through the origination process or monitoring loans in the on-book loan portfolio? And can I save them where they can be shared by the entire origination team or others that need to see them?

With the Madison System you can save any electronic file in the Document Vault. And it can be saved in the appropriate spot in the application – loan documents are saved with the loan, collateral documents are saved with the collateral, contact documents are saved with that contact. With documents associated with contacts, for example, they are saved once and automatically are available for any loan with which that contact is associated.If you get electronic appraisal files, say in Word or as PDF file, they can be saved with the collateral or valuation record.  If you have photos of collateral, or collateral inspection forms, of borrower financial statements and tax returns in electronic formats, they can be saved in the System.

Why is this important? The documents can then be viewed online by any user with the appropriate permissions, saving time and effort looking information up in paper files or requesting it from the person that has that file. Documents are safer and more secure.

Print This Post

Windows Navigation – Find it Fast!

Windows Navigation – Find it Fast!

Overview: Here are a couple of hints about windows navigation features that can help with the Madison System or any other Windows based system.

Finding an Item in a Long List

If you are presented with a long list of items, such as a list of loans and want to find one loan, you can depress the �Control� key and the �f � key at the same time which will open a �Find� dialog box. You can type into it what you are looking for, say a loan number, and then click �Next�. The next item with that number will be highlighted on your screen.

Selecting Items from a Multiple Pick Drop Down List

There are two type of drop down lists. One allows you to select only one item from the list; this note is not about that kind of list. The other type allows you to select multiple items from the lists. To do so you can depress the control key and then put your mouse on an item to be selected and do a left click on your mouse. With the control key still depressed, put the cursor on the next item and left click again. Continue with the Control key depressed and selecting all the items you want.

If the list is long, you may need to scroll down the list to see all items in the window that displays the list items. To do so, use the scroll bar that is usually on the right side of the display box that contains the list of items. Don�t use the up and down arrows to move down the list.

Print This Post

Ticklers Make Life Easy (Easier?)


Ticklers Make Life EasierOverview: Effective management and administration of commercial loan portfolios requires maintaining up to date information about borrowers and the collateral or businesses that support repayment of the loan. Keeping on top of this information is challenging task that can involve many individuals throughout the organization.

Some of the information that needs to be kept up to date includes:

  • Borrower financial statements and tax returns, both personal and business
  • Collateral and/or business financial statements
  • Collateral and/or business valuations
  • Collateral inspections
  • Property rent rolls
  • Property occupancy
  • Tax Payments
  • Insurance (all types of policies)
  • UCCs
  • Loan Ratings
  • Credit Reviews

There are two related issues. One is the capture of the information and the second is a ticker system to give reminders of upcoming due dates as well as notice of events that are past due. Ideally, the two should be integrated with each other so that all a user needs to do is enter the updated information and the tickler capability will be updated automatically.

Tickler information needs to be arranged primarily by the contact person that should be notified of pending or past due tickler items. But tickler information should be available on a loan by loan basis as well. It should be convenient to request information by email and by letter, and either media should be able to pull out of the database information about the requested item such as the last date received, next due date, etc.