Banks can get help making sound loans, setting adequate loan loss reserves, and soon, predicting a customer's future financial performance.

Halcyon Group, a software company in Folly Beach, S.C., is pitching its lead product as an antidote to regulatory pressure for more Community Reinvestment Act lending.

Halcyon Group At a GlanceHeadquarters Folly Beach, S.C. CEO Robert J. Brinson Founded 1982 Employees 20 Leading Fiscal product Customers 2,000, including NationsBank, SBA

"We're trying to find the silver lining, taking adversity and turning it into something we can live with," said Robert J. Brinson, Halcyon's chief executive.

Halcyon's "Fiscal" software lets a bank evaluate how likely a borrower is to repay, based on an analysis of the company's financial statements and tax returns.

"The lender then has the opportunity to see how the business has been operating and whether it's financially sound enough to take on new debt," Mr. Brinson said in an interview.

Banks can use the software as a tool to pick the best companies for CRA loans. Clearly, the software can be used to judge the quality of any loan.

The package costs about $2,500 and is easy to use.

First, the banker keys in financial statement information such as revenues, assets, and debt. The computer takes that information and compares it with data for similar companies.

The system holds information on 350 types of businesses. Data bases include the Robert Morris Associates industry standards and the Internal Revenue Service's industry norms.

The banker can then choose from any number of reports, such as a general overview of the business, reports on sales growth, trends, projections, or problem areas.

The company's toll-free service hot line averages less than one problem call a day, Mr. Brinson said.

About 2,000 businesses in the United States, Canada, Mexico, Europe, and the Far East, use the software. Half are financial institutions. While most customers are community banks, some larger institutions, such as Nations-Bank, are Halcyon clients.

Other customers include 80 district offices of the Small Business Administration and big companies like Campbell Soup and Hewlett-Packard.

Although Fiscal is Halcyon's primary product, the company this year also began selling "LLR," a loan-loss reserve management product.

The software takes loan information and automatically sets the loss reserve for each one to meet regulatory requirements. It then uses the individual loan data to set an overall number.

Halcyon will introduce a new version of LLR in January that will give bankers more flexibility to override the computer if they don't agree with its decision. LLR now costs $3,500 and has about 24 users.

Many small banks now calculate loan-loss reserves manually or with a spreadsheet program. Mr. Brinson expects the ease of this product to make it a good seller.

A third Halycon product, to be released in early 1995, will help banks predict trends in borrowers' businesses. Not yet named, the new software will analyze a business's trends to predict its future.

"The idea here is to project when and if this company may be facing hard times," Mr. Brinson said.

Halcyon was founded in 1982 as a management consulting firm by Mr. Brinson, his brother Barry, and his brother-in-law Tom Bullock. The name comes from Greek mythology, meaning happy and idyllic.

"We wanted to deliver peace, tranquillity, and prosperity to our customers and to their customers," Mr. Brinson said. "Halcyon came to mind as something that captured that."

Before he started his own business, Mr. Brinson worked for 22 years at Fortune 500 chemical and food processing companies. After tiring of constant travel and long hours, he took some time off before starting Halcyon.

"I left and kicked back to relax and take advantage of what the world had given me," said Mr. Brinson, who is married and has two children in their 20s.

Although Mr. Brinson would not reveal the assets of the company, he said sales have grown at least 30% every year since 1986. He credits that success to having a product that the financial world needed, and also to intense marketing.

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