Commercial Loan Documentation: The Loan Process and Documentation in Support of Commercial Loan Decisions

Why Should You Attend:

The lending process includes the following phases: application, investigation, evaluation, decision documentation, administration, and collection. All of these phases require some form of documentation in order to protect the bank's interest. This part of the lending process is essential in order to avoid loan losses due to poor documentation especially during a bankruptcy case. Many community banks assign this important responsibility to loan officers and loan administrators. If not performed accurately, poor documentation can cause loans to be essentially unsecured or unguaranteed where the bank is expected to have some form of credit enhancement (collateral) as a secondary source of repayment.

This webinar on commercial loan documentation will focus on providing attendees with a sound working knowledge of the purpose and significance of each document in the lending process. It will offer a broad overview of the loan documents' provisions to borrowers while enabling attendees to identify and document the collateral.

Learning Objectives:

After completing this course the participant will:

1. Recognize the documents required to complete the five steps in the documentation process
2. Have a good working knowledge of the purpose of each document
3. Be able to provide a broad overview of the loan documents' provisions to borrowers
4. Know the rules of perfecting the security interest under the rules of Article 9 of the Uniform Commercial Code
5. Know the basic documentation required for closing an agricultural loan
6. Have a keen understanding of loan processing management techniques

Areas Covered in the Webinar:

1. Identifying the borrower
2. Identifying and documenting the collateral
3. Evidencing the debt
4. Partnership/entity
5. Corporation ownership control
6. Attaching the collateral
7. Perfecting the security interest
8. Perfect the collateral
9. Documents required to close various commercial loans
10. Borrower's perspective in commercial loan transaction
11. Bankruptcy trends
12. Debtor vs original debtor
13. Closing the loan: techniques and documentation
14. Ensure first priority in securing lending under the Uniform Commercial Code
15. Cases and questions

Who Will Benefit:

• Commercial Loan Officers
• Consumer Loan Officers
• Credit Analysts
• Loan Review Personnel
• Compliance Officers
• Internal Auditors
• Branch Managers
• Credit Administration Personnel
• Loan Operations Staff

Instructor Profile:

Jeffery Johnson's banking career spans 36 years working for large, regional and community banks. He started his career with SunTrust National Bank in Atlanta as a management trainee and progressed to vice president and senior lender for SouthTrust Bank (a large Southeastern regional bank) and senior vice president and commercial banking division manager for Citizens Trust Bank of Atlanta (community bank).

Most of his career has been spent in credit administration, lending (commercial, consumer and real estate), business development, loan review, management, and training and development. He has managed loan portfolios representing a cross section of loan types including: large corporate, high net worth individuals, middle market companies, small businesses, real estate and non-profit organizations and managed several loan officers with portfolio management responsibilities.

Mr. Johnson is now a training professional in the industry leading various banking seminars, both within the US and internatinally. He teaches actively for twenty-two state banking associations and community banking associations in the United States, and for the Risk Management Association (RMA) and individual banks nationwide. He co-authored a training course entitled "Lending to Service and Other Professional Organizations" for RMA in 2001.

In order to stay abreast of issues facing banks, Mr. Johnson engages in loan reviews for his client banks. During an engagement, he reviews loans of all sizes to determine creditworthiness; compliance with banking rules and regulations; compliance with the bank's internal credit policy; accuracy of the loan grade; completeness of the documentation file and other aspects such as portfolio trends, performance and capital adequacy.

Mr. Johnson earned his B.A. in Accounting degree from Morehouse College in Atlanta, GA; MBA in Finance from John Carroll University in Cleveland, Ohio; and his banking diploma and certification from the Prochnow School of Banking at the University of Wisconsin-Madison and the First American Management Institute at the University of Pennsylvania's Wharton School of Business.

Topic Background:

Loan documentation extends beyond legal documents such as the promissory note and security agreement but also includes other documents supporting the lender's decision to approve the loan. It is a critical component in the lending process as it transforms the transaction into a legally enforceable form and clarifies the transaction so that each party understands the details of the lending arrangement.

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