Excellence begins at RMA: associates extol the benefits of being RMA-Credit Risk Certified

"How can I be sure the candidate my institution is interviewing has what it takes to handle credit risk challenges?" RMA has heard versions of this question with growing frequency. At the same time, job candidates seeking advancement opportunities are asking, "How can I establish my ability and credibility to perform the 'whole job'"? RMA's response to both queries: the RMA-Credit Risk Certified (RMA-CRC) designation.

In 2002 RMA explored the need to recognize top performers in the credit risk field and began to consider the value of an industry credential. RMA's position as the global industry leader made it appropriate for the association to develop the RMA-Credit Risk Certified credential. As Jeff Leeds, EVP and chief lending officer at Lawrence Savings Bank, says, "RMA has long been recognized as the leading provider of educational programs for bank credit and risk management training. This establishes the independent standard by which banks and credit personnel alike can assure themselves of a level of proficiency."

What is certification? To receive the credential, an individual must successfully complete a tough four-hour exam, demonstrating proficiency in the overall credit risk business requirements. "Passing the certification exam ensures that we, as financial services employees, have a consistent body of credit knowledge--and can apply it appropriately," says Nancy Kowalski, VP and credit officer, Key Bank. "This benefits our respective companies and the industry as a whole. It also spotlights our individual performance as being 'best in class.'"

The RMA-Credit Risk Certified credential distinguishes the successful certification recipient from all others in the field. Not only does it validate credit risk skills, but it identifies exemplary achievement for those who pass the exam. Further, it demonstrates that both the recipient and bank recognize the industry's best credit practices and shows customers the institution's commitment to expert skills, knowledge, and professionalism. As Ken DiFatta, Credit Administration SVP at AmSouth, states, "It makes a statement about their knowledge and their ability to apply that knowledge."

Tol Broome, EVP and senior loan administrator, BB&T, adds, "First, having the certification will be an advantage in consideration for promotions. Second, it will certainly help the candidate in being considered for opportunities at other financial institutions. Our industry is changing a lot with consolidation, so the validation that certification will offer in terms of providing credibility within the industry will be a critical issue."

Leeds believes that "certification provides two vital benefits to candidates: 1) the personal satisfaction of knowing they have achieved a demonstrable level of competency in their field; and 2) the knowledge that their competency is transferable. They will be recognized by their peers and superiors as having achieved a proficiency level that sets them apart." Leeds gratefully notes, "Finally, there is a way for bank employers and managers to assure themselves that job candidates have the fundamental skill sets required to perform the analysis function."

Although not necessarily an endorsement of future performance, certification recognizes significant achievement and validates skills for employers and customers. "A candidate is empowered by the successful completion of a certification," says Derk Lovell, VP and credit training manager, Zions Bank. "The successful candidate will be able to materially demonstrate his or her actual levels of lending [and] credit prowess. This [person] will be able to properly assert the claim of being a true credit [and] lending professional."

The employing bank "... can use the certification in a number of ways, such as loan authority levels, overall lending skills assessment, and consideration for promotions within the company, particularly in areas in which strong credit skills are needed," says Broome.

A symbol of commitment. The mission of the RMA-Credit Risk Certified designation is to acknowledge the individual recipient as "best in class" for commitment to the field. The continuing education component recognizes ongoing commitment to remaining current and informed. To maintain the certification, the recipient is expected to earn 60 continuing education credits over three years. These education and industry activities help ensure that the recipient stays current and aware of credit risk trends and regulations.

The exam. RMA's Certification Steering Committee members--from U.S. and Canadian regional, national, and community banks--validated the exam questions. A psychometrician (authenticator) guided question development, question approval, and the test delivery process. This process took more than a year to complete.

Of foremost concern to the Steering Committee and authoring team was that the exam would contain the scope and content necessary to assess the knowledge of a sufficiently skilled credit risk professional.

To keep the questions representative of the changing field, the exam is reviewed on a periodic schedule under the guidance of the RMA-CRC Steering Committee and a psychometrician.

Eligibility. Candidates applying for the RMA-Credit Risk Certified examination should be credit professionals--lenders, credit officers, credit analysts, or credit administrators--with at least three years of current credit risk experience. The exam assesses seven key credit risk areas, also known as dimensions. As Christianne Paris, VP, RBC Bank, says, "The accreditation touches all key points needed to understand lending. It is an invaluable tool for any serious lending professional."

Once the candidate is accepted, he or she can download the Body of Knowledge from RMA's Web site. This document contains the minimum material a sufficiently skilled candidate is expected to know and outlines the exam blueprint, including the seven dimensions. Each dimension highlights key topics, additional skill-enhancing resources, and detailed dimension-related content. On-the-job experience and knowledge will be necessary to add depth to the Body of Knowledge material. The Steering Committee recommends 40-80 hours of study preparation, which can be concentrated in those areas identified as knowledge gaps. RMA provides access to this material after the candidate's application is accepted.

The expanded RMA Credit and Lending glossary is available to accepted applicants as well. Knowledge of these terms helps the candidate navigate through the exam; however, it is the implementation of the types of concepts and ratios presented in the glossary that is validated on the test. RMA also provides candidates with access to the on-line practice exam, which familiarizes the candidate with the style and difficulty of questions, as well as scenarios on the actual examination.

Certification: It's time. According to DiFatta, this exam "enhances the professional image of the industry, putting [it] on similar footing as a CPA or CFA."

Meanwhile, Broome cites the certification used in related industries such as accounting, real estate sales and appraisals, and investment product sales, to name a few. "The certification will provide the banking industry with a valuable, independent tool to assess lender skills on a uniform basis. The industry, now must do this either with a proprietary process, by day-to-day observation, or by an educated guess. Our industry needs an independent skills assessment tool to validate the credit skills of lenders and credit professionals."

Key Skills Addressed in the Exam

--Evaluating client's industry, markets, and competitors.

--Assessing client's management ability.--Completing accurate, ongoing, and timely client financial assessments.

--Assessing strength and quality of client/sponsor cash flow.

--Evaluating collateral values including collateral inspections.

--Identifying repayment sources, and structure and documenting credit exposures.

--Recognizing problem loans and taking appropriate actions.

For more information about the exam, visit www.rmahq.org or contact Sylvia Czajkowska, RMA Certification Specialist, at 215-447-4017. The exam is offered in the spring and fall. Applications will be accepted for the spring offering beginning November 1.

Katherine Vitale, CDP, CCP, is a professional development consultant at RMA.

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