02 — Capability · BC-1720.40
Collateral & Security Interests
Know what secures each loan, what it is worth and that the bank's claim on it is legally perfected, from origination until the security is released. Valuing and selling collateral after default is part of recovery.
- Collateral Administration
- Security Interest Tracking
- Lien Administration
In scope
- Collateral appraisal, valuation and revaluation
- Lien filing, perfection, renewal and release
- Insurance and condition tracking on pledged assets
- Guarantors and other secondary sources of repayment
Out of scope
- Repossession and liquidation after default (see BC-1720.50)
- The organization's own guarantees and credit support (see BC-230.20)
- Contract drafting and legal advice in general (see BC-150.20)
Realized by · 0
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Used in · 2
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Decomposes into · 4
- BC-1720.40.10Collateral ValuationObtain appraisals and valuations of pledged property, vehicles, equipment and securities, and refresh them when policy or market moves require.
- BC-1720.40.20Lien Perfection & ReleaseFile and renew the bank's security interests so they hold against other creditors, and release them promptly once the debt is repaid.
- BC-1720.40.30Collateral MonitoringTrack insurance, borrowing base reports and the condition of pledged assets, and flag loans whose coverage has fallen below policy.
- BC-1720.40.40Loan Guarantor RecordsRecord the guarantors and other credit support behind each loan, keep their financial information current, and track the limits of each guarantee.