Banking Rotation

The banking rotation showed us all the ins and outs of credit. Parkside is a commercial bank, meaning they mostly lend money to companies rather than individuals. The foundation of a successful credit analysis is accurate financial statements. During this rotation we worked with several of these statements to gain a better understanding of the underlying companies’ financial performance. Using this newfound knowledge, we assisted the analysts in preparing loan renewals to be brought to loan committee. Loan committee, held each Tuesday morning, is where loan officers and analysts discuss and approve upcoming loans. By being a part of this complete process we were able to see how loans go from requested to approved. Once a loan is approved it must be monitored so any problems that might come up can be addressed. One important element of this process is performing industry analyses. An industry analysis consists of summarizing important information about an industry’s historical and projected performance. Another interesting aspect of credit is collateral. When real estate is listed as collateral, the bank needs an accurate appraisal of its value. To accomplish this, Parkside usually finds comparable real estate in the area and uses their market prices to determine that value. Throughout the rotation we had opportunities to see this process in action. The banking rotation allowed us to see how the bank brings in new business and builds loans from the ground up.