(Did you miss parts I and II, reviewing what to focus on before and during a bank merger for SBA 7(a) teams? Part I is here, and part II is here.)
The dust is settling. The merger has closed. Your teams have combined, which probably means you’ve also had to say farewell to some of your teammates; that’s a sad and challenging thing that happens when companies merge, banks or otherwise.
Now what?
The process of SBA loan packaging and Lender underwriting continues, possibly with a few bumps as you get used to working together. Team members coming in from the acquired bank will need some additional support and training to acclimate to new systems and processes; the acquiring bank’s team can help support them and will also have some new things to learn.
And frankly, you’re all probably worn out from the challenges of the last few weeks and months as the consolidation progressed!
So yes, take a breath or two.
And there are still things to be aware of and cautious about.
Double- and triple-check that all loans are in full SBA compliance. Make sure your checklists are doing their job, keeping you aligned with SBA’s SOPs and with your bank’s internal procedures.
Verify you have access to all of the loans through Etran and FTA.
Has SBA raised any questions or red flags about compliance? Do they have open questions or concerns? Were there follow up items to their approval that need to be completed?
In the process of merging systems, did the loan data map over correctly for all the loans acquired? Are any errors in mapping critical to your regulatory, credit bureau, or SBA reporting?
Are there any lingering loan documentation deficiencies that were identified during pre-merger file reviews? Is there a plan to rectify them? Do any loans still need a full file review to identify deficiencies?
Will any loans from either bank’s SBA portfolio be sold or transferred, for any reason?
Pay special attention to your initial post-merger 1502 report. Did the ongoing annual service fee calculate correctly for your unsold loans? For your sold loans, did the principal and interest payment spread correctly? Was the loan status reported correctly? And are your next payment and interest paid-to-date accurate? Be sure to review any error or missing loan reports the FTA provides. This will help identify issues that may have occurred when boarding the loans.
It’s easy to feel like the challenges are behind you, but unfortunately that’s exactly where we see some SBA teams relax a little too much.
So celebrate the closing for sure. But then verify and re-verify that your processes are working as intended, that your checklists cover all the necessary details, and that your team members are supporting each other and working well together.
Want some help reviewing those processes and checklists? That’s one of our favorite things to do as SBA consultants – we’re big fans of process and checklists! We can also provide Lender SBA Training to ensure your consolidated team is operating in sync with SBA’s requirements – and with those revised processes. Give us a call at 877-576-0819, or drop us a line through our contact form, and we’ll talk about how we can support you.
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