Let’s build a repeatable governance mechanism, not a one-off post-mortem. A "Lessons Learnt" series in a bank should balance three objectives:1. Regulatory expectation (demonstrating institutional memory, avoiding repeat mistakes).2. Business value (turning mistakes into better decision-making frameworks).3. Cultural change (moving from blame to structured learning).Here’s a draft Terms of Reference (ToR) and implementation plan: Terms of Reference: Lessons Learnt Series Purpose To capture, analyse, and institutionalise insights from past credit losses, ensuring that the Bank continuously strengthens its risk management, decision-making, and client engagement practices. Scope Events covered: credit defaults, significant restructurings, fraud cases, operational errors, regulatory breaches, and near misses.Application areas: origination, structuring, monitoring, documentation, approval, control, and exit strategies.Impact level: material losses (e.g., >USD Xm or reputationally significant cases), but also patterns of recurring small losses. Objectives 1. Extract systemic insights beyond individual blame.2. Translate lessons into policies, frameworks, training, and monitoring tools.3. Share learnings with relevant staff, frontline relationship managers, credit risk managers/ credit approvers, internal auditors, at scale4. Evidence to regulators that lessons are extracted and shared, not just documented. Governance Owner: Credit Institute Co-owner: Group Special Asset ManagementApprovers: Group Chief Credit Officer (or delegated committee). Process 1. Case selection – Quarterly identification of cases via portfolio review, watchlist meetings, non-performing loans, audit findings, and feedback.2. Case analysis – Structured template: root cause, missed signals, flawed assumptions, governance gaps.3. Lesson extraction – Boil down to 3-5 core insights per case.4. Translation – Map lessons into actionable changes:Policy/procedure updatesDeal structuring guidelinesTraining modules & simulationsEarly warning indicators5. Dissemination – Regular “Lessons Learnt Briefs” (short, digestible), workshops, and integration into banker training.6. Tracking – Monitor whether changes are adopted and effective (via audit, portfolio review, regulator feedback). Frequency Quarterly workshops (cross-functional).Annual consolidated report to Board Risk Committee. Outputs Case study pack (for training & reference).“Do/Don’t” quick cards for bankers.Playbooks for structuring/monitoring common risk scenarios.Regulatory submissions when required. Confidentiality & Culture Ensure lessons focus on decisions, systems, and processes—not personal blame.Protect confidentiality of clients and staff. Implementation Plan Phase 1 – Set-Up (0–3 months)Secure ExCo and Board Risk buy-in.Nominate sponsor (CRO) and secretariat.Develop templates for case capture & analysis.Pilot 2–3 past cases for demonstration value.Phase 2 – Rollout (3–12 months)Launch quarterly “Lessons Learnt Forum” chaired by Risk/Business head.Publish first Lessons Learnt Brief.Embed into banker and approver training.Build searchable internal database.Phase 3 – Institutionalisation (12+ months)Integrate into credit approval workflow (e.g., checklist referencing lessons).Incorporate into performance reviews (measuring risk culture).Annual report to Board + regulators.Cross-bank sharing (regional/global if relevant).---🔍 A critical point: this should not become a compliance-box exercise. The real leverage comes from turning cases into forward-looking structuring guidance and deal design principles, otherwise, staff will read once and forget. “Lessons Learnt Case Note” Template The 2-page unit of learning that bankers could digest and regulators could audit. That would make this more concrete. Here’s a 2-page “Lessons Learnt Case Note” template you can institutionalise. It’s designed to be short, structured, and practical, something a busy banker, approver, or regulator can grasp in 5 minutes.---📄 Lessons Learnt Case Note TemplateCase ID: [Unique identifier]Date of Case Note: [DD/MM/YYYY]Prepared by: [Unit/Team]Reviewed by: [Risk Committee/Approver]---1. Case Summary (≤150 words)Client profile (sector, geography, size)Type of transaction (loan, facility, trade finance, derivative, etc.)Outcome (default, restructuring, fraud, loss amount, near miss, reputational impact)---2. Timeline of Events (visual if possible)Date Key Event Observations[DD/MM] Approval granted [e.g., covenant weakness identified but not tightened][DD/MM] Monitoring event [e.g., early warning ignored][DD/MM] Default/restructuring [e.g., borrower cash flow dried up]---3. Root Cause AnalysisBreakdown by category (tick & explain):Business decision gap (e.g., aggressive assumptions, client pushback accepted)Risk structuring flaw (e.g., security unenforceable, weak covenants)Monitoring failure (missed warning signs, late action)Governance/control gap (approval override, policy not followed)External shock (macro, regulatory, market)---4. Key Lessons (3–5 points only, clear and actionable)[Lesson 1: State as principle, not story, e.g. “Do not rely on projected cash inflows without independent verification.”][Lesson 2: …][Lesson 3: …]---5. What Could Have Been Done DifferentlyStructuring alternatives (e.g., require escrow of receivables, add performance guarantees)Monitoring approaches (e.g., trigger-based covenants, independent auditor checks)Approval discipline (e.g., escalate exceptions rather than waive informally)---6. Actionable Outcomes (for institutionalisation)Policy/Process Update: [Specify rule or guideline change]Training Update: [Add to banker/approver curriculum]Portfolio Monitoring: [Add EWI or portfolio flag]Tools/Templates: [New checklist, playbook reference]---7. Quick Reference “Do / Don’t” CardDo:Verify borrower’s largest customer payments independently.Escalate early when covenants are breached, even if client promises recovery.Don’t:Accept equity cure clauses without assessing shareholder liquidity.Rely solely on management projections in cyclical sectors.---8. Dissemination & TrackingCirculated to: [Frontline bankers, approvers, Risk, Audit]Embedded in: [Credit training, policy manual, deal checklist]Tracking: [Who ensures compliance and follow-up]---👉 The format deliberately forces brevity and clarity:Page 1 = Story + Analysis.Page 2 = Lessons + Actions + Quick Reference. Case Study Template This shifts from “institutional memory” (case note) into “institutional teaching” (case study). A case study for training has a different rhythm: it must immerse bankers in the decision-making context, surface dilemmas, and walk them through consequences, not just report the outcome.Here’s a Case Study Template (3-hour session) designed for bankers:---Case Study Template – 3-Hour Training1. Case Title & ThemeEngaging title (e.g., “The Bitter Taste of Sweet Deals: Lessons from an F&B Importer Default”)Theme (credit structuring, monitoring failures, sector risks, governance, etc.)---2. Learning Objectives (framed as capabilities, not knowledge)By the end of the case, participants should be able to:Identify weak assumptions in financial projections.Apply structuring tools to mitigate sector-specific risks.Design monitoring benchmarks that trigger timely action.Translate a failure into forward-looking portfolio discipline.---3. Background Narrative (Context Setting) (~15 min read)Client description (industry, size, ownership, history).Sector backdrop (macro, competitive, regulatory, supply chain).Bank’s relationship history.Why the deal was attractive / pressure to book business.---4. The Deal (Decision Point)Facility structure (amount, tenor, pricing, covenants, security).Financials snapshot (balance sheet, P&L, cash flow).Bank’s risk assessment (what was said in credit memo / approval pack).Red flags (embedded in narrative, not highlighted).Decision Question: “If you were the deal team / credit approver, what would you do?”---5. Discussion Exercise 1 – Before the Fall (~45 min)Participants work in groups:Spot risk drivers.Stress-test projections.Redesign deal structure (security, covenants, pricing, triggers).Deliverable: 3 key structuring changes.Group presentations (5 min each).---6. The Unfolding Events (Part 2 Narrative) (~15 min)Timeline of deterioration (delayed shipments, margin squeeze, customer loss, covenant breaches).Bank’s responses (monitoring, waivers, restructuring attempts).The default / restructuring outcome.---7. Discussion Exercise 2 – During the Crisis (~45 min)Groups debate:What early warning signs were missed?What monitoring should have been in place?What interventions could have preserved value?Deliverable: Recommended monitoring framework + escalation playbook.---8. Resolution & Outcomes (~15 min)Final restructuring / recovery outcome.Actual losses (P&L impact, reputation, regulatory scrutiny).Client and relationship fallout.---9. Discussion Exercise 3 – Aftermath (~30 min)Groups propose:Policy/process changes.Sector-specific guidance.Quick-reference “Do/Don’t” list.Compare to actual bank’s post-mortem actions.---10. Facilitator’s Wrap-Up (Synthesis) (~15 min)Extract 3–5 enduring lessons.Link to frameworks (structuring toolkit, monitoring benchmarks, sector playbooks).Highlight how the case feeds into institutional knowledge.---11. Materials ProvidedCase note (2-pager, pre-read or handout).Simplified financials pack (balance sheet, P&L, cash flow, projections).Timeline chart (for Part 2 narrative).Worksheets for group discussions.---12. Assessment / ReflectionQuiz / short reflection (individual) to lock in recall.Feedback form on what participants will apply in their next deal.---Time Structure (3 hours total):15m Intro + objectives15m Background narrative45m Exercise 1 (Before the Fall)15m Unfolding events45m Exercise 2 (During Crisis)15m Resolution narrative30m Exercise 3 (Aftermath)15m Wrap-up & reflection---Design principle: keep participants inside the deal team’s shoes, not as external commentators. That way they feel the tension of commercial vs. risk trade-offs.---Would you like me to draft a filled-in sample case study pack (say, a mid-sized commodity trader collapse in Asia) to demonstrate how narrative + exercises + financials actually flow in practice? That could become your first “flagship” training case.
