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Risk management automation – the big picture

Automating your commercial loan system offers significant advantages, especially for risk management teams. Automating risk-related tasks and processes can increase productivity and reduce errors, helping your business stay ahead of the curve. Additionally, reducing manual and redundant activities such as data entry improves engagement and frees employees to focus on their core job functions.

In a recent survey of 200 credit and risk managers worldwide, respondents highlighted these benefits of automating risk management:

Percent of managers Benefit
71% Better risk control and management to protect the organization’s profitability
64% Better executive decision-making with automated and dynamic reports
62% Improved efficiencies
59% Better early-warning systems
33% Better positioned for regulatory requirements1

How risk management automation helps credit risk management teams

Many aspects of the credit and risk management process can be automated, including data collection, risk evaluation, monitoring, credit decisioning, underwriting, servicing, and reporting. Additional advantages of automation for credit risk management teams include:

Adding efficiencies Employees, managers, compliance officers, and examiners can easily find and share information and produce reports. Additionally, automating business processes saves time by making them repeatable and scalable. It also improves the effectiveness of a risk management program.

Supporting collaboration Automation solutions enable loan officers and reviewers to work together. With a dynamic (vs. static) workflow, they can capture, review, and clear bank-specific findings, approve completed reviews, and create follow-on action items as needed. The result is a better employee experience and better risk management too.

Enhancing the review process With configurable templates that match your existing style, you can capture new narrative and analysis and maintain loan-specific details. Users across multiple departments can view loan status, add documentation, and insert tables, financials, and commentary. These capabilities help create an informed, updated team, demonstrate the advantages of dynamic credit processes, and enhance your ability to monitor risk.

Improving covenant compliance strengthens your risk management program – Stay on top of requirements and monitor risk by tracking loan-level covenants and raising alerts for exceptions. With automation solutions, you can also define covenant-level review periods to ensure timely updates and generate detailed reports for quick and easy remediation.

Streamlining credit administration of funded loans and related collateral – Use an automated credit administration system as your system of record for changes to credit actions such as risk ratings, charge-offs, non-accruals, and TDRs. This streamlines the approval process, improves efficiencies, and makes decisions transparent, leading to better credit policy compliance.

Providing transparency Make dashboards available to managers for big picture views of critical operational areas such as the loan pipeline, portfolio-level approvals, and covenant status. Automation solutions facilitate dynamic credit management with timely information to monitor risk and follow key risk management processes.

Simplifying audits – Provide your auditors with workflows that follow the same business processes instead of frequent manual workarounds. Enable them to drill down on specific borrowings and find underlying documents, notes, reports, and follow-up actions.

As can be seen, automating risk management provides many benefits for credit risk management and credit policy compliance by making business processes more consistent, compliant, and streamlined.

What are automated risk management tools?

Automation tools support dynamic credit risk management processes. These tools include:

Alerts keep teams aware of changes to loan activity, approval statuses, and more.
Cloud-based storage provide cost savings and advanced security. Lenders should be in the business of lending, not buying, installing, configuring, and maintaining complex onsite IT infrastructures.
Custom templates tailored to match your style and business needs.
Dynamic workflow enables lending, credit, loan officers, and reviewers to work together, facilitating credit policy compliance.
Dashboards for data insights credit risk managers can track performance, concentrations, exceptions, and more with the ability to drill down as needed.

Limits to Credit Management Automation

With all the improvements in credit risk management automation, will a day come when Credit Risk Managers are no longer needed? In our opinion, no. At least not in our lifetime. Credit risk managers are necessary to lead and guide risk management automation. This automation allows credit risk managers to act as leaders and change agents. Their judgment and oversight are required to manage the automation process, monitor the results, intervene when necessary, and encourage new and better working methods. As credit risk managers become comfortable with technology its benefits, they can guide their organization along its automation journey.


Credit and risk management professionals face new challenges today. They must address changing market conditions, increased competition from Fintechs, a hybrid workforce, and a growing number of millennial workers who prefer digitized work environments. An automated commercial loan system addresses these challenges, providing the means to work faster and smarter.

“With BankPoint, we have access to consistent information. Before BankPoint, everyone wrote reports from the core that looked different. We never knew what we were going to get. Now we have standardized reports and data.” Treasurer, $18B Bank

Enjoyed this blog? You may also want to view Best Practices for Managing Risk Rating Approvals.