Karen Schwall is a Senior Director at MountainView Risk and Analytics, managing relationships with credit unions and numerous community banks. Karen enjoys managing and serving her clients while bringing over 30 years of banking expertise to the table. In the interview below, Karen gives us deeper insight into her role as Senior Director at MountainView Risk and Analytics, asset liability and other financial models, her background, and some of her enjoyments outside of work.
Q: Can you please introduce yourself?
A: Hi, my name is Karen Schwall and I’m a Senior Director at Mountain View Risk and Analytics. I like to say that I keep a lot of beautiful minds busy with work. I work with people who are highly experienced practitioners and really want to do a fine piece of work for the clients that we represent. I do focus on the community institution space, so most of my clients are credit unions and community banks. I’ve been here a little over seven years now. I joined the team because I have a background in banking, asset liability management, and profitability, which is related to the work we do. I started off in banking in the late 80s, just out of college and I have worked in or with financial institutions all of my career. I first learned of what was the legacy MountainView Group, originally called McGuire Performance Solutions, while I was in executive leadership at ProfitStars, a leading ALM provider for community banks and credit unions. As ProfitStars was growing, we had clients that needed deposit studies to help with their modeling assumptions as well as help with model validation. This was all new in the 90s. At that time, Bill McGuire, who had formed the original company, was a pioneer in both of those services. So, while I’m not directly a former client, I referred ProfitStar clients to this group years ago and got to know the group more and more. Over time, several of my team members came over to this company and I joined later on because I really enjoyed the work that they do and their reputation is pristine.
Q: What do you enjoy most about your role at MVRA?
A: I enjoy serving our clients and managing relationships. In the community space, there’s a variety of levels of expertise, so one of the things I enjoy is the combination of helping clients get the services that they need while providing a lot of education. The conversations that we have revolve around understanding certain concepts or understanding the results of the work that we have done. Those educational points are very meaningful to me.
Q: Tell us about your day-to-day and overall what it’s like working at MVRA?
A: In the community banking space, there is more variety in the number of institutions that I work with and a little less variety at times in the types of projects we do. In the larger banking areas managed by my talented peers, a broader variety of models are validated, although that is filtering down into the smaller community banks and credit unions more.
As far as my day-to-day goes, I have a lot of conversations on the phone. I also have frequent meetings, a lot of times on MS teams. We spend a lot of time working through how to set up an engagement that really satisfies the needs of each client. Not every engagement is the same, even in a very mature space like asset liability model validation. There are unique features that may need to happen in a particular project and I really want to listen for that. I want to make sure that what we put into our production schedule matches their true needs.
Q: What are the unique features of asset liability or other financial models?
A: There are unique features to pretty much any engagement but some of the unique features are in terms of the scope of deliverables. Our clients vary in size and scope in the credit union space. In my territory, we’ve worked with clients of less than 100 million in assets and we’ve worked with clients over 20 billion in assets. That’s quite a range. So, you have to make sure that the scope of the work for their particular asset size, the complexity of their balance sheet, and the complexity of their ALM or other financial model is appropriate for them and covers all their needs.
Q: Is there anything you can say about the industry as a whole and where you think it may be heading or trending?
A: Certainly, there’s a lot to do in the industry today about cybersecurity and fraud issues. We have made changes in the last few years to expand our services so that we can provide validation on Bank Secrecy Act and anti-money laundering (BSA/AML) models that are in place. In general, there are increased complexities for using models within institutions, and more things are classified as models than were before. In the smaller space, there’s a lot of Excel work that clients have done for years and years that in today’s standards may need to be classified as models. So, that makes education really important. Is it a model or isn’t it a model? If it’s a model, how do I rank this model in terms of model risk management terms? There are a variety of ways to rank it. There is no definitive answer to that, but we can educate on how to evaluate this and help build a framework for model risk management. With credit unions, there are different regulations, which impacts the larger credit unions more than the small credit unions. Again, it falls back on education and having a dialogue with a client. We really need to talk to each other about what they’re trying to accomplish and what their model is. I’m involved in engagement right now, where there are multiple models involved in their process. So, even just defining the scope of work for the agreement has been a little bit of a challenge because we are having to define who owns what model and how we get the data. You have to be a really good listener and interviewer so that you help the client get ultimately what they need.
Q: Are there any projects that you are currently working on or looking forward to working on at MVRA?
A: I’m really the liaison that’s helping to define the scope of work and draft the appropriate agreements to define the scope of work for the engagement. I also coordinate with the production team, who are going to be the people that do the hands-on work. I currently have a pipeline that includes a variety of projects and a variety of credit union and bank sizes. Some are deposit studies or loan prepayment studies, whereas others are validation for a variety of models (ALM, ALLL, CECL, FTP, Loan Purchase, and more.) So, the variety of work and clients keeps me interested.
Q: What do you enjoy doing outside of work? Do you have any hobbies?
A: Yes, I’ve got a lot of hobbies. I love to be outside and bike whenever I can. My husband and I started doing that a number of years ago. We travel to different states to bike when possible. We also spend a lot of time with friends and even travel out of state to stay with them a good bit. It’s just an excuse to travel – I like to be on the move and see the country. I also play the piano. I was actually groomed to be a concert pianist though I decided to major in business administration and get my MBA in corporate finance. I grew up in a musical family, so I also sing. My father taught voice performance at the college in town and my mother taught music in public school and gave private piano lessons at home. They both were in church positions as ministers of music for 67 years, so it just ran in my family.
Q: Do you have any personal plans coming up for 2022?
A: We are going to travel as much as we possibly can. I love going to the Florida Keys and have a trip booked there. My new snorkel gear has already arrived. I also want to go to Hawaii and Prague soon. I’m going to build up a bunch of frequent flier miles because I’m going to be on the road again.
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