An Objective Technique for Loan Officer Evaluation Available to Purchase

Since most of the revenues of a bank are from interest on the loan portfolio, there is always considerable pressure to generate new loans. Certainly, the volume of new loans is an important statistic in the evaluation of lending officers. However, a major concern of senior management is that an increase in loan generation should not be accomplished by a decrease in credit standards. An objective framework for including loan loss experience in the evaluation of individual loan officers is provided.