14 October 2008

Credit

IFRS - Implications for Commercial Lenders

Convergence to International Financial Reporting Standards (IFRS) from U.S. GAAP accounting will have ramifications for the knowledge and skills required of commercial lenders and analysts. Recent trends and events appear to make this change inevitable in the U.S.

Over 100 countries now use IFRS and a significant share of global Fortune 500 firms use IFRS. What's driving this change is the desire for a uniform standard for financial statement presentation and disclosure. And, there are global trends and economic drivers including the integration of the world's capital markets that has resulted in more securities issued and owned by foreign companies.

There are several important implications for commercial lenders:

• The need to understand IFRS and the differences between it and GAAP to evaluate the impact of accounting differences.
  
• With principles-based accounting, lenders need to be sure they understand the business and the logic of the underlying business transactions as opposed to simply relying on quantitative analysis of the financial statements.
  

The long-term global impact is that within 10 years, we may have a much more universally accepted approach to business accounting. Lenders and institutions who can successfully adapt to a new mind set for financial reporting will have a competitive advantage in booking high-quality assets.

Want to learn more? View a replay of our webcast, IFRS: A Game Changer for Commercial Lending.

Learn more about improving credit performance ...

Sales & Service

Optimizing Lean Staffs Through Training

Training is often one of the first things to be cut by banks in difficult times, yet optimal employee performance continues to be the most important factor in achieving business results -- especially during economic downturns.

According to an article in American Banker, a retail bank estimated that a 10% improvement in employee engagement (customer interaction effectiveness) was worth over $1 billion a year to the bottom line.

There is a definite correlation between staff effectiveness and business results and the need for employees to be performing optimally.

So rather than eliminate training during difficult economic periods, organizations should be:

• Selective about the training in which they're investing - choose training based on its ability to develop skills and change behaviors. It should include demonstrations, activities, skill practices, and assessments that enable participants to insert the concepts of learning into the context of their jobs.
  
• Creative in the way they deliver training - taking into account not only the cost for travel and expenses, but also the coverage required for employees to be taken away from their locations for days at a time.
  
• Strategic in the way training is sustained through coaching - at no time is coaching more important than immediately following training when employees are motivated, concepts are clear, and application through skill practice and assessment has heightened confidence.
  
• Diligent about retaining staff through ongoing training support - the cost to hire and train an employee is between 50 and 200 percent of their annual salary; since there is a direct correlation between good training practices and reduced employee turnover, maintaining training protocol and frequency is critical to attrition.

Learn more about improving sales and service performance ...

Leadership

Change Management 101

Not surprisingly, people don't adapt to change easily -- and part of that is the way in which the change is communicated. Most organizations indicate why the change is being made in terms of what it will do for organization, with no expansion into what it will mean to the employees.

People don't adapt to change because of their intense desire to impact the bottom line. It is far more personal and therefore people's reactions are often manifested in ways that range from rejection to indifference to neutrality and other states in between.

Managers who address change at the micro level by dealing with one employee at a time and knowing that as the individual adapts, so does the team and subsequently the organization, are most successful at leading and sustaining change efforts.

Want to learn more? View a replay of our webcast, Leading People Through Change: Build your Change Resilience, Coach your People to Commitment, and Increase Business Results.

Learn more about improving leadership performance ...

Visit Omega's Blog Today!

Keep up with Omega's bloggers by visiting Ideas You Can Bank On, Opinions on Improving Performance in Financial Services.

Mark Faircloth's post, Manage This (Part 3 of 3) is now live.

Public Seminars

Advanced Cash Flow
A one-day, highly interactive seminar where you will learn how to effectively analyze complex commercial borrowing situations.

November 25, 2008
Abu Dhabi

November 26, 2008
Dubai

More information and to register

Coaching For Credit Quality
A one-day, highly interactive seminar where you will gain proven coaching techniques to more effectively manage the credit analysis process.

December 2, 2008
Sydney, Australia

December 4, 2008
Melbourne, Australia

More information and to register

Minimizing Problem Loans
A two-day, highly interactive seminar where you will learn how to effectively monitor, evaluate, and take appropriate action on potentially problematic commercial loans.

December 3-4, 2008
Orlando, Florida

More information and to register

Leading and Coaching Your People Through Change
A one-day, highly interactive seminar where you will gain the skills and tools needed to effectively guide your people through periods of change.

December 9, 2008
Sydney, Australia

December 12, 2008
Melbourne, Australia

More information and to register

New Articles

"When You Are Up to your Waist in Alligators it is Hard to Remember You Started Out to Drain the Swamp" or, "Remember When Real Estate Loans Made Us Lots of Money?"

It is no secret that the commercial real estate market is following the same negative trends we have seen in the residential real estate markets over the past year. It is also no secret that many financial institutions have long held to the premise that: "If you lend on dirt, you can't get hurt." We are now seeing that this long-held premise has all of the validity of an old wives tale. Download the complete article, authored by Dr. Jerry Crigger, Omega Performance's vice president and senior consultant: credit and risk.

Download Now

Knowledge Currency

Published in Mortgage & Finance Brief (Aug./Sept. 2008 issue)

Online learning offers many advantages for time-poor brokers and programs can be individually customized to suit specific education needs. Get your complimentary copy of this article, authored by Howard Cook, Omega Performance's new business and alliances manager, Australia, now.

Download Now

Quick Links ...

Our Website | Our Blog | Events | Omega News | About Omega | Complimentary Resources