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Career Story: Portfolio Officer For A Large Regional Bank

Portfolio Officer For A Large Regional Bank

Job Title: Vice President - Portfolio Officer

Type of Company: To provide loan or lease financing for capital equipment replacement or growth plans.

Education: BS, Business Administration, SUNY-Brockport •• MBA, Finance, SUNY-Binghamton •• certificate, Investment Banking, New York University School of Continuing Education

Previous Experience: I began my career in banking and finance as a credit analyst, analyzing the credit-worthiness of corporate borrowers. In the wake of the S & L scandals of the late 1980's, I took a job with a large regional bank in NYC and was promoted to Assistant Treasurer within a couple of years. Six years later, I took a job as Assistant Vice-President for Credit at an Austrian bank. But when the bank was bought out by another Austrian bank, I accepted an offer to work in Saudi Arabia as a Portfolio Officer under a 1 year contract. (I left early when anti-American attacks in Doha and Riyadh starting making me nervous.) In 2000 I took a Senior Credit Analyst position with Boeing's finance arm, providing equipment debt and lease financing to large corporate customers and a few airlines. But then the company decided to get out of the leasing business and I moved to Atlanta to work for GMC. Finally, in May 2006, I moved to New England and took a job as VP-Portfolio Officer for the equipment-financing subsidiary of a large regional bank.

Job Tasks: My primary responsibility is to underwrite loan or lease proposals for companies seeking financing for their capital equipment needs. What this means, simply, is that I analyze the credit-worthiness of companies seeking to borrow money to finance the purchase of equipment for their business operations. This is very similar to the sort of thing banks would do before lending someone the money to buy a home or issuing them a credit card for day-to-day purchases.

My job requires me to take at least three steps; (1) gathering information about the prospective customer directly from the customers himself, and also from third parties such as rating agencies, (2) digesting and analyzing the information I receive, and (3) writing up an analytical report or "credit proposal" that is then sent up the corporate ladder for approval or rejection.

To do the first step right, I have obtain the three most recent years of financial statements from the company and review them and related business issues with the senior management of the company. So senior management have to make themselves available to me and cooperate in answering my questions. The collection and analysis of financial information are called the "due diligence phase" or the "vetting phase" and help us to comply with the company policy of "KNOWING YOUR CUSTOMER". They also keep us in compliance with provisions of the Patriot Act.

With regard to the second step noted above, after receiving the information, I proceed to digest it by (a) spreading the financial statements and reading through the footnotes of the [hopefully] audited statements, (b) preparing other analytical charts and (c) mentally juxtaposing the various analytics I've prepare with the answers to my due diligence questions as provided by the management of the company.

To draft a credit proposal, I have to prepare a document that outlines the proposed loan/lease transaction, the history of the lessee with a sketch of its owners and senior management and some background on company's operations that includes a discussion of its products and services and the markets it serves. I then include some industry analysis, with a discussion of the size and dynamic of the industry in which the company operates; some financial analysis of the company, with an analytical presentation of the company's recent performance as reflected in its income statement, balance sheet, and cash flow statement; a outline of potential risks and mitigants, that outlines the most significant risks associated with the company as faced by the proposed transaction; and my recommendation for approval, which requires me to support it with my final findings.

Best and Worst Parts of the Job: The best part of the job is the writing part. After collecting all the information and preparing the analytics, I proceed to the writing phase. I've found that I really enjoy putting my words down in a document that many others will read, some above me on the corporate ladder and others either below or beside me.

The worst part of the job is having to deal, if only occasionally, with uncooperative customers. Some companies seem to believe that money should just be bestowed on them, no questions asked. And it becomes like pulling teeth to get them to answer my due diligence questions in enough detail to allow me to underwrite the transaction. Obviously, if they fail to meet my requirements, the deal dies.

Job Tips:
1. To get your foot in the door you need to obtain as much education as possible. The more you have in finance or accounting the better your chances are of seeing opportunities. These disciplines are looked on more favorably than other non-finance/accounting disciplines.

2. Once you find a job, pursue the internal training programs that are offered by the bigger banks. This training is dubbed "the golden ticket" and it will open doors to promotion, or better opportunities in the future. If you get a job with a small finance company, you will have to pursue training from third-party vendors. And you would have to convince your employer to foot the bill.

3. Read a lot about business news and political news. These days both business and politics are intertwined. So, start with a subscription to the Wall Street Journal, Forbes Magazines, and Fortune Magazines. By reading a lot, you'll expand your knowledge of current business trends and developments, the governmental regulatory environment and of risks and other issues. The more you know, the more potential hirers will know about you.

Additional Thoughts: Often, there is much in-fighting and bickering and resentment. These are the negative aspects of the business world that arise from disagreement. As an analyst, you may at times disagree with others about risk or the perceptions of risk associated with a prospective transaction. My advice is, learn to agree to disagree with others; always keep your cool and keep it respectful; and remember, it's never personal and it should never be personal.

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