Portfolio Analysis and Pooling for a Banking Institution Acquisition

Problem: A well-capitalized investor required a complete and detailed analysis of a loan and lease portfolio (that included many mortgage and commercial loans) as the basis for setting the purchase price of a $2 billion banking institution.  The task required in‑depth data collection, evaluation, and reporting of all factors that would influence price.

Solution: BPA examined and evaluated over 10,000 loans and leases in a short period of time.  We built initial databases for nearly 20 separate residential, commercial, and consumer portfolios using data from seven separate servicing systems.  We also examined original loan and lease documents, servicing files and procedures, and asset performance histories housed in four separate locations for each loan.  The results were used to grade each loan and lease, and to group them in over 100 pools.  We prepared a composite report that provided narratives, financial profiles, and pool data files.

The results were presented to and successfully used by three major securities firms providing independent portfolio valuations.  Our findings facilitated a quick completion.

Note: Actual client names have been removed due to confidentiality issues.

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