Loan Review


The Capsa Group provides an integrated, efficient approach to third party loan review services designed to meet both regulatory expectations and internal control considerations. Our team possesses the regulatory understanding and training necessary to comply with the FDIC policy on loan review. We also possess the requisite knowledge and experience in financial reporting to meet your internal control considerations for complying with US accounting principles, including SEC requirements.


Your loan portfolio represents your most significant asset and is your primary source of revenue. Controls around your loan portfolio are critical in providing you assurance you have reliable data to meet the extensive financial reporting requirements for this asset group. The Capsa Group delivers you the results you need for both your regulatory compliance and financial reporting requirements.


We design our approach to loan review to include tests and considerations essential for calculating the allowance for loan and lease losses (“ALLL”) and meeting regulatory guidelines such as:


• Proper loan type classification


• Appropriate underwriting to substantiate the existence and securitization of collateral


• Appropriate grading, including commentary on the adequacy of the documentation of the underwriting decision, and ensure that regulatory guidelines are followed properly


• Review of the total borrower relationship for technical exceptions and underwriting quality


We document our conclusions and grade the loans according to your criteria. Although the scope of our review is not to determine or recommend specific reserves, we will inform you of any information that becomes available during the loan review process that may assist you in this regard. At the end of our review, we conduct an exit meeting and all working papers will be made available to you.


Upon request, The Capsa Group provide the Bank, The Bank's Auditors and/or Regulatory Examiners with a copy of our working papers to substantiate assigned ratings for all loans reviewed. Our experience has shown that the Bank's auditors or regulatory examiners may wish to review some of the working papers to supplement their examinations and to minimize duplication of effort.