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Client Profile – Federal Government Agency

Warbird Consulting Partners (“Warbird”) was contracted by the Client to provide Receivership Assistance.
The Client was responsible for all the activities related to the closing, field management and resolution of failed financial institutions brought under the control of the Client.

Warbird was a partner with the Client currently engaged to provide the technical expertise necessary to manage and facilitate the overall financial institution resolution. Warbird services encompassed both Receivership and Financial Management as follows:

Warbird has assisted the Client in closing of 37 institutions by quickly and efficiently either returning the deposits to the depositors or transitioning the failed bank to the acquiring institution within the weekend.
Warbird has also successfully assisted the Client in pursuit of recoveries from those who contributed to the bank’s failure.

Warbird Consulting Partners (“Warbird”) contracted with the Federal Deposit Insurance Corporation (“Client”) to provide loan Due Diligence services on portfolios of loans owned or controlled by the Client. Pursuant to the first Task Order received and completed, our project was to compile and review loan documents and data provided by the Client to ensure that the loans being reviewed were represented in the Client’s system, that the data is consistent with the loan documents, and that the loan types and characteristics were compliant and properly categorized.
It was important to determine that this information was accurate to ensure that the valuation of the loan assets was also accurate and appropriate to the current market conditions.

Warbird used an internal document imaging and indexing system to compile, catalog, retain, review and distribute loan document packages. The system also provided individual “deal rooms” for review and consideration of the loan assets by advisers and potential buyers. Warbird partnered with finance technology experts, Access Business Technologies (“ABT”), who provided Managed Hosting, Integration, Web Services, Reporting and Professional Services along with its flagship distribution platform PowerCore, a proprietary Forensic Data Management System utilized in the review process.
Warbird utilized a due diligence work-flow process to guide the review of the loan and to gauge document sufficiency, underwriting consistency, compliance, servicing sufficiency, risk characteristics, and collateral sufficiency. ABT created a comprehensive centralized loan portfolio review database for the due diligence reviews. The work performed was specifically Due Diligence on over 4,700 Loans.

The initial project request was for Compliance Reviews only, and was completed in a three-week time frame. All tasks and deliverables were completed on time.
Warbird mapped the Client’s data to its own database system, and used exception reporting to identify and correct data inconsistencies and insufficiencies. The data was then compared to electronic document images to verify the accuracy of the Client’s data.
Various loan types and characteristics were identified and grouped for electronic review for compliance with regulations. Reviewers then validated the findings by reviewing the document data to ensure accurate results.
Reports were produced on both a loan- and portfolio-level basis that stratified the loan assets based on data characteristics and individual loan ratings. Warbird was able to complete the Engagement with maximum flexibility, minimum disruption and at extremely attractive billing rates. Warbird was commended by the Client for its efficiency and knowledge.

The Client engaged Warbird for assistance in planning for the resolution of any troubled processes. Warbird was selected in large part because of the work it is doing for a large Government agency.

Warbird suggested revisions to the Client’s Type II Special Examination procedure. This tool was used to gather information for planning a receivership and potential acquisition of assets. Most of the recommended additions related to asset specific information not captured in the call report and additional detail on operational issues.
Recommendations were made on procedures and information needs for a bidders’ conference. The bidders’ conference would be held just prior to the appointment of the receiver with the goal of arranging for another institution to acquire the assets of the failing entity. This approach minimizes disruption to borrowers and keeps assets in a viable entity rather than in the hands of a receiver.
Warbird created an initial strategic and staffing plan for resolution of a $500 million institution through liquidation or by acquisition. This plan was designed to provide background on the failing institution to all personnel involved in managing the resolution and set initial priorities. It also defined staffing requirements for either scenario.
Lists of activities were by function for key aspects of a liquidation or acquisition.

In each of these tasks, Warbird used the same approach that has been applied over several receiverships at the Government Client with modification to reflect the unique characteristics of this insurance Client.
In addition, processes were streamlined where ever possible and designed to allow the Client to leverage its very small staff.
The overall approach envisioned Warbird as a general contractor arranging for any specialized services as needed.