Dates of Event & Pricing

$295 for Webinar and Playback*

*Playback has no expiration.

  • Tuesday, July 12, 2022

  • 2:00 – 3:00 pm (Eastern Time)

  • 1:00 – 2:00 pm (Central Time)

  • 12:00 – 1:00 pm (Mountain Time)

  • 11:00 – 12:00 pm (Pacific Time)

Curriculum

Overview 

Lending to construction contractors is risky business, but this session will show you how to evaluate that risk, how to underwrite an appropriate lending structure, and how to monitor and manage that credit exposure.  The construction industry accounts for 10 to 20% of a local economy, so extending credit thoughtfully to this sector benefits both your organization and the market you serve. 

Topics discussed include:

  • Volatility of construction risk in economic cycles—accelerator principle
  • Supply chain risk for contractors—scarcity and volatility of construction materials
  • Payment process for contractors and subcontractors
  • Contractor status report
  • Key elements in contractor accounting and financial statements
  • Progress billings, retention, and collateral value
  • Role of sureties in providing bonds to contractors—lien priorities
  • Useful conditions and covenants in contractor loan underwriting


Learning Objectives

  • Learn how to analyze key contractor accounting disclosures such as underbillings, overbillings, progress billings and the contractor job status reports
  • Learn how to judge your contractor’s financial condition and performance compared to industry ratios and statistics
  • Learn how to evaluate repayment ability by projecting operating cash flow based on the contract status report and the contractor’s financial statements
  • Learn how to assemble key underwriting elements of loans to contractors into a viable credit proposal — sufficient and adequate cash flow, collateral, and guarantees to repay in full, on time, and as agreed

Instructor

Devon Risk Advisory Group / Principal

Dev Strischek

A frequent speaker, instructor, advisor and writer on credit risk and commercial banking topics and issues, Martin J. "Dev" Strischek is principal of Devon Risk Advisory Group based near Atlanta, Georgia. Dev advises, trains, and develops for financial organizations risk management solutions and recommendations on a range of issues and topics, e.g., credit risk management, credit culture, credit policy, credit and lending training, etc. Dev is the former SVP and senior credit policy officer at SunTrust Bank, Atlanta. He was responsible for developing, implementing, and administering credit policies for SunTrust’s wholesale lines of business--commercial, commercial real estate, corporate investment banking, capital markets, business banking and private wealth management. Prior to SunTrust, Mr. Strischek was chief credit officer for Barnett Bank’s Palm Beach market. Dev is also a member of the Financial Accounting Standards Board’s (FASB’s) Private Company Council (PCC).

Credits

1.0 CPE Credits & 1.2 AAP Credits