Have you spoken with your regulator lately regarding concerns tied to the ratios of your institution? Do you wonder what their thresholds are and what other ratios they might be concerned about?
Regulators, at times, can be focused on locating those “red flags” within your financials that can identify an area of concern on your balance sheet. As you are likely aware, a red flag doesn’t necessarily mean there is something wrong, but rather something you should be prepared to address. Most bankers we have had this conversation with over the years remain focused on operating a safe and sound bank while trying hard to remain off the regulator's radar as much as possible.
Asset Management Group (AMG) has created a report to help you with identifying these flags prior to the phone call from your regulator. The Red Flag report, a similar analysis done by some regulatory agencies, was originally developed to help with scoping an exam and prompting phone calls between exams. A “red flag” would indicate potentially elevated risk to the bank and would likely tend to cause an examiner to look more closely at what is causing this “flag”. Having a report like ours will allow you, the banker, to be proactive when preparing for an exam. We believe that if you can see what your regulator is viewing prior to the exam, then you are in a better position to explain these issues should they surface.
Below is a sample of the Red Flag report I am referring to. We also have available a red flag trend analysis to see how you have done over time. Since the information comes from your public Call Report data, we have the ability to run this report for any institution, customer or not. This report is just one of many ways we at AMG strive to make our clients’ life easier. We are continually looking for ways to better analyze data and returning it to our clients in a way that can be useful. If you want to learn more about how we help our clients or how you can receive this report, call us at (800) 226-1923 or email us at firstname.lastname@example.org.