By Derek Ezovski, President, ORMS, LLC

In last month’s article, I shared the “whys” behind ORMS’s chosen business model. With a foundation built on three solid pillars – expertise, passion, and an unrelenting focus on serving our clients’ unique needs – we feel strongly that this is the right approach for now, and for the future.

Speaking of the future, the pandemic crisis is transforming the industry in new and complex ways. The ground is shifting rapidly under our feet, and it may never slide back to the way things were.

For lenders, this uncertainty will introduce both new risks and new opportunities. For the short term, economic instability means softening real estate values and deteriorating borrower credit. With economic indicators like unemployment rates, GDP, and consumer confidence more precarious now than at any time since the Great Recession, prudent risk management strategies are sorely needed.

But it’s important to remember that risk management also serves as the infrastructure for growth. By establishing a solid bedrock for assessing and monitoring all aspects of lending risk, you will have the confidence to invest in new markets and opportunities as they arise.

Managing Risk to Capitalize on Opportunity

To navigate these uncertain times, what do lenders need? For one, you must have ready access to industry-leading expertise in highly specialized areas like SBA lending. As the federal government rolls out new relief programs like the PPP to address the historic and ever-growing economic crisis, small business borrowers are increasingly looking to their primary financial institutions to provide advice and support. A deep knowledge of the ins and outs of SBA lending criteria and due diligence requirements, along with those of other federal and state lending programs, is more critical than ever during these times.

You also need to be able to address fluid market changes and shifts in local economic conditions as they arise – quickly and flexibly. This means working with partners that provide outstanding service and respond with a sense of urgency. In the present situation, the ability to offer calm, reasoned advice to your business borrowers is paramount. In turn, you need to know you can rely on a team of risk management experts to provide confidence and peace of mind in support of your collateral valuations and underwriting decisions.

Lastly, in the current economic climate, everyone is watching their expenses, and financial institutions are no exception. With interest rates at historic lows and delinquency rates on the rise, banks and credit unions must protect their shareholders and member-owners from downside financial risk. In certain cases, this may call for belt-tightening and resource conservation. In critical but non-core functions like risk management, outsourcing to respected and vetted third-party experts helps keep costs low and manageable.

The ORMS Difference

Since our inception in the wake of the last financial crisis, ORMS’ mission has never wavered. We assess our clients’ needs, provide expert advice based on decades of experience in environmental and collateral risk management, and sub-contract with the best service providers in the business to get the job done.

At ORMS, we truly believe this approach will pay off in the long run. It is a philosophy designed for the challenges of today, as well as the needs of tomorrow. Our business model allows us to do what we do better than anyone else in the market, and our clients are thrilled with the results.

“Recognizing that obtaining SBA approval of environmental due diligence can be time-consuming (and sometimes difficult), we began outsourcing the CDC review of environmental due diligence to ORMS,” says Mark S. Cousineau, President, Community Investment Corporation (CT). “The company reviews the due diligence and provides a draft of the CDC recommendation for our submission to SBA. If necessary, they will interface with the environmental professionals who issued the report and/or with the SBA in order to facilitate an approval.

“Long story short – it’s an inexpensive way to bring ‘in-house’ environmental expertise to the table on an as-needed basis and shorten the approval time for SBA environmental reviews.”

If you are looking to overhaul your risk management program during these chaotic times, or even just considering a “tune-up,” don’t hesitate to contact us at info@orms.com. Your risk management experts at ORMS are here to help!