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SBA Hot Topic Tuesday — Reduction of On Site Reviews

May 19, 2015

By Bob Coleman
Editor, SBA Hot Topic Tuesday

Reduction of on site reviews is what SBA lenders can expect more of says Lance Sexton, former SBA Deputy Director of the Little Rock Commercial Loan Servicing Center.

The new SOP 50 10 5(H) changes in SBA monitoring and reviews include the following:

SBA deleted the On/Site – Off/Site review language- The impact of this will be the potential reduction in On Site Reviews.

SBA added language to address the new PARRis review format. PARRiS is an acronym for the specific risk areas or components that SBA reviews: Portfolio Performance; Asset Management; Regulatory Compliance; Risk Management; and Special Items. – The impact of this is the expectation that all lender reviews will follow the PARRiS format.

The fee discussion for on-site reviews was removed. My expectation is that we will see SBA moving away from a significant number of on-site reviews and move toward more off-site or virtual reviews.
The PARRis review will become the most frequently used format for SBA reviews for banks.

This is more of a virtual review. They look at the overall performance of the bank in its SBA Lending effort. In areas that have a less than satisfactory rating, they dig deeper.

Watch Lance Sexton’s Short Video from Coleman’s Webinar: “The New SBA SOP Changes Affecting Your SBA Loan Borrowers Effective May 1”

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