Pros and Cons of a Chief Lending Officer Career
A chief lending officer manages the loan staff at a financial institution. He or she oversees lending activities and makes sure loans remain profitable over the long term. Check out the pros and cons of becoming a chief lending officer to see if it's right for you.
| Pros of Becoming a Chief Lending Officer |
|---|
| High earning potential (median salary of about $174,000 as of 2016)* |
| Relatively low education requirements (bachelor's degree is usually sufficient)* |
| Variety of work duties (assessing employee performance, creating goals, monitoring loans)** |
| Flexibility of job location** |
| Cons of Becoming a Chief Lending Officer |
|---|
| Significant experience is required (10+ years requested by most employers)** |
| Potentially stressful occupation (making sure employees are following lending laws, handling collection efforts, being responsible for all loan activities in a department)** |
| Must remain aware of current state and federal banking regulations** |
| Some employers prefer applicants with a graduate degree, such as a Master of Business Administration** |
Sources: *Salary.com, **Job posts from June 2012.
Essential Career Information
Job Responsibilities
A chief lending officer performs a range of duties as leader of an organization's overall loan portfolio. You'd set policies and procedures regarding lending activities, ensure adherence to federal regulations and establish goals for long-term portfolio growth. You'd also be responsible for motivating staff members and overseeing their lending activities.
Chief lending officers provide accurate and detailed reports of lending activity and loan portfolio performance to top executives. You may also need to develop policies that attract new customers and set goals for your staff. Resolving troubled loans and making sure that debts are collected are important and potentially unpleasant duties that must often be performed by a chief lending officer.
Salary Info
Salary.com reported that chief lending officers earned a median annual income of approximately $174,000 as of 2016. The bottom 10% of these professionals earned about $108,000 annually, while the top 10% earned more than $259,000 per year, according to Salary.com.
What Are the Requirements?
Many chief lending officer positions require at least a bachelor's degree and about 10 years of experience. Some employers prefer that you have an advanced degree, such as a Master of Business Administration (MBA), a Master of Science in Finance or a master's degree in a related field. Depending on your employer's industry, you'll also need to have specific knowledge of lending regulations at the state and federal levels.
A wide array of skills comes into play as a chief lending officer. Critical thinking and problem-solving abilities will be key assets for your career in the lending business, and you'll also need to have superior interpersonal skills for dealing with prospective clients. Additionally, good communication and presentation skills will come in handy when reporting to top executives.
What Employers Are Looking For
If you have the experience and education required to become a chief lending officer, you may find work at a variety of financial organizations. Several job postings that were open in April 2012 reflect some common expectations and requirements of chief lending officers.
- A large financial institution in New Jersey was seeking a chief lending officer to be responsible for the development, management and oversight of commercial lending standards. This position involved building and managing a lending department that could adhere to standards of service performance while also expanding the organization's loan portfolio. At least 10 years of experience in residential, commercial or consumer lending was required, and an MBA was preferred.
- A financial services company based in New York was looking for a chief lending officer to help resolve troubled debt and address loan portfolio losses. The successful candidate would recruit and manage a new sales/business team and oversee loan resolution strategy. Applicants needed 10 years of experience, and those with a graduate degree would be preferred.
- A financial institution in Washington advertised for a chief lending officer to oversee a portfolio with consumer, commercial and real estate loans. Applicants needed 10 years of experience, preferably with a credit union. A bachelor's degree in business administration or finance was required, and an MBA was preferred.
How to Get an Edge in the Field
Employers often prefer a prospective chief lending officer to hold an advanced degree, but there are additional ways you can set yourself apart from other job candidates. Various banking associations offer courses for students interested in lending and for experienced loan officers who want to stay current in their skills. For example, the Bank Administration Institution offers the Loan Review Certificate Program for people who review and approve loans.
Maintaining a broad knowledge of lending strategies is another way to enhance your professional qualifications. Being well-versed in consumer, commercial, real estate and mortgage loans is important. It's also a good idea to acquire as much knowledge as possible in the fields of loan collection and loan underwriting. This can be done through electives while you pursue a degree or by working in an entry-level position while you work your way up to becoming a chief lending officer. Keep in mind that other applicants for these high-paying positions will also have many years of experience, so you'll want as much experience in lending and loan underwriting as you can get as soon as possible.
Alternative Career Options
If becoming a chief lending officer doesn't seem like the right fit for you, you may still be interested in other financial careers. You may want to look into becoming a financial examiner if you'd rather ensure that financial institutions are following regulations. Financial examiners spend much of their time reviewing balance sheets and assessing the risk of loans. Most financial examiner positions require a bachelor's degree in business or accounting, and you'll need at least 6 semester hours in accounting if you wish to work for the Federal Deposit Insurance Corporation (FDIC). The U.S. Bureau of Labor Statistics (BLS) projected a 27% increase in jobs for financial examiners from 2010-2020. The BLS reported that financial examiners earned a median salary of about $75,000 as of May 2011.
Working as an actuary may also be of interest if you want to analyze financial risks without all of the stresses of overseeing an entire loan department. You'd use computers and statistical methods to design insurance policies, pensions and other financial products. Actuaries generally need a bachelor's degree and must also become certified by either the Casualty Actuary Society or the Society of Actuaries, depending on the type of work you'd be doing. The BLS predicted that actuaries would see healthy job growth in the coming years, with overall employment for these professionals expected to increase by 27% from 2010-2020. As of May 2011, the BLS reported that actuaries earned a median salary of approximately $91,000.
