CREDIT RISK RATINGS. (1) The Board shall submit within sixty (60) days of the date of this Agreement, to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection, a program to ensure: 1) the risk associated with the Bank's loans and other assets is properly reflected and accounted for on the Bank's books and records, and 2) the Bank properly recognizes income, to include, at a minimum, provisions requiring that:
(a) the loan grading system is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller's Handbook and is based upon definitive objective and subjective criterion;
(b) loans and other assets are graded based upon current facts and existing/reasonable (considering the loan purpose) repayment terms with a focus upon whether the primary repayment source is threatened by a well-defined weakness and whether the credit relies heavily upon secondary repayment sources, especially illiquid collateral or an unsubstantiated guarantor;
(c) loans and other assets are timely placed on nonaccrual by the lending officers in accordance with the guidelines set forth in the Call Report;
(d) lending officers conduct periodic, formal reviews for determining the appropriate risk rating and accrual determination;
(e) an enhanced, written formal analysis, including appropriate documentation, that is reviewed and approved by the Bank's chief credit officer, or in the absence of a permanent chief credit officer by the Bank's Loan Committee, is maintained in the credit files to support the current and previous risk rating and accrual determination for all credit relationships totaling seven hundred and fifty thousand dollars ($750,000) or more;
(f) all executive officers involved in the Bank's lending function, and all lending officers receive immediate training with respect to the application of Subparagraphs (a) through (e) of this Article;
(g) the lending officers and senior management are assigned responsibility and held accountable for ensuring the Bank's loans and other assets are appropriately and timely risk rated, charged off and/or placed on nonaccrual;
(h) the program includes an independent validation of the risk rating process; and
(i) management information systems periodically provide feedback about the effectiveness of the program by senior management and the individual lending officers.
(2) Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shal...
CREDIT RISK RATINGS. (1) Within ninety days (90) of the date of this Agreement, the Bank shall perform a portfolio-wide credit review, with a focus on real estate secured loans, to determine the current extent of risk. Factors that must be considered in this review are:
(a) new appraised values or other updated valuations;
(b) project performance;
(c) payment performance;
(d) maturity dates;
(e) remaining interest reserves; and
(f) current financial information regarding principals and guarantors.
(2) Within sixty (60) days of the date of this Agreement, the Board shall develop a program to ensure that the risk associated with the Bank’s loans is properly reflected and accounted for on the Bank’s books and records, to include, at a minimum, provisions requiring that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated and charged-off by the lending officers using a loan grading system that is based upon current facts, existing repayment terms and that is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook;
(b) the Bank’s loan review system provides meaningful, detailed reports to the Board on portfolio quality, risks, and trends; and
(c) loan officers are accountable for failing to appropriately and timely risk rate loans.
CREDIT RISK RATINGS. (1) Effective immediately, the Board shall take the necessary steps to ensure that the risk associated with the Bank’s loans is properly reflected and accounted for on the Bank’s books and records, to include, at a minimum, the monthly review of all credit relationships that equal or exceed two hundred thousand dollars ($200,000) by the loan officers to ensure that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated and charged off using a loan grading system that is based upon current facts, existing repayment terms and that is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook; and
(b) the Bank’s loans and other assets are timely placed on nonaccrual in accordance with the guidelines set forth in the Call Report.
(2) Within sixty (60) days of this Agreement, the Board shall prepare a written program designed to ensure that the Bank complies with Subparagraphs (a) and (b) of this Article, that contains at a minimum:
(a) immediate and ongoing training for the lending staff with respect to the application of Subparagraphs (a) and (b) of this Article;
(b) procedures to ensure loan officers are held accountable for failing to appropriately and timely risk rate and/or place loans on nonaccrual, including but not limited to, consideration of loan officer and staff failure to properly risk rate and/or place loans on nonaccrual in periodic performance reviews and compensation.
(3) After the Board has developed the program required by this Article, the Board shall immediately implement and thereafter ensure adherence to its terms, and shall within five (5) days of completion, submit a copy to the Assistant Deputy Comptroller.
CREDIT RISK RATINGS. (1) Within sixty (60) days of this Agreement, the Board shall develop a program to ensure that the risk associated with the Bank’s loans is properly reflected and accounted for on the Bank’s books and records, to include, at a minimum, provisions requiring that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated and charged off by the lending officers using a loan grading system that is based upon current facts, existing repayment terms and that is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook;
(b) the lending staff receives sufficient training with respect to the application of Subparagraph (a) of this Article;
(c) loan officers are accountable for failing to appropriately and timely risk rate; and
(d) loan officer failure to properly risk rate is considered in periodic performance reviews and compensation.
(2) Within sixty (60) days of this Article, the Board shall take the necessary steps to ensure that all credit relationships equaling two hundred fifty thousand ($250,000) or above are reviewed and accurately risk rated consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook.
(3) After the Board has developed the program required by this Article, the Board shall immediately implement, and shall thereafter ensure adherence to its terms.
CREDIT RISK RATINGS. (1) Within thirty (30) days of the date of this Agreement, the Board shall take all necessary steps to ensure that the Bank’s loans and other assets are timely and appropriately risk rated and accounted for by the lending officers. Bank management shall provide a written report to be filed with the Board at least monthly and shall use a loan grading system consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook. Such Board reports shall, at a minimum, provide:
(a) the identification, type, rating, and amount of problem loans;
(b) the identification and amount of delinquent loans;
(c) the identification of all nonaccrual loans and leases in accordance with Call Report instructions;
(d) timely recognition, within the quarter of discovery, of all loan downgrades due to potential or well-defined weaknesses; and
(e) a process to ensure timely charge-offs for loan losses or impairments.
CREDIT RISK RATINGS. (1) Within thirty (30) days of this Agreement, the Board shall develop a program to ensure that the risks associated with the Bank’s loans and other assets are properly reflected and accounted for on the Bank’s books and records, and appropriately reported to the Board and management. Such program shall include, at a minimum, provisions requiring:
(a) the Bank’s loans and other assets are appropriately and timely risk rated using a loan grading system that is consistent with guidelines set forth in Rating Credit Risk, A-RCR of the Comptroller’s Handbook;
(b) immediate and ongoing training for the lending staff with respect to the application of Subparagraph (a) of this Article; and
(c) procedures to ensure loan officers are held accountable for failing to appropriately and timely risk rate loans and other assets, including but not limited to, consideration of loan officer and staff failure to properly risk rate loans and other assets in periodic performance reviews and compensation.
(2) Upon completion, the Board shall submit a copy of the program required by Paragraph (1) of this Article to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection. After the Assistant Deputy Comptroller has advised the Bank that there is no supervisory objection to the program, the Board shall immediately implement, and thereafter ensure adherence to, the terms of the program.
CREDIT RISK RATINGS. (1) Within forty five (45) days of this Agreement, the Board shall take the necessary steps to ensure that the risk associated with the Bank’s loans is properly reflected and accounted for on the Bank’s books and records, to include, at a minimum, provisions requiring that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated and charged-off by the lending officers using a loan grading system that is based upon current facts, existing repayment terms and that is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook;
(b) the Bank’s loan review system provides meaningful, detailed reports to the Board on portfolio quality, risks, and trends;
(c) loan officers are accountable for failing to appropriately and timely risk rate loans; and
(d) troubled debt restructures (TDR) are properly accounted for in the Bank’s call reports. Management must appropriately monitor and risk rate TDRs according to regulatory and accounting guidance. Loan officers and management need to become more educated in TDR accounting and grading criteria.
(2) Within thirty days (30) of this Agreement, the Board shall review the recent real estate focused portfolio-wide credit review and take the necessary steps to ensure that the Bank’s credit risk has been accurately reflected upon the Bank’s books and records and takes into account the following factors:
(a) new appraised values or other updated valuations;
(b) project performance;
(c) payment performance;
(d) maturity dates;
(e) remaining interest reserves; and
(f) current financial information regarding principals and guarantors.
CREDIT RISK RATINGS. (1) Within thirty (30) days of the date of this Agreement, the Board shall develop a program to ensure that the risks associated with the Bank’s loans and other assets are properly reflected and accounted for on the Bank’s books and records, and appropriately reported to the Board and management. Such program shall include, at a minimum, provisions requiring that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated using a loan grading system that is consistent with guidelines set forth in Rating Credit Risk, A-RCR of the Comptroller’s Handbook; and
(b) Internal loan reviews of the Bank’s Overland Park, Kansas branch and all other Bank locations are completed on a timely basis, consistent with a written loan review coverage plan to be approved by the Board on an annual basis.
(2) Upon completion, the Board shall submit a copy of the program required by Paragraph (1) of this Article to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection. After the Assistant Deputy Comptroller has advised the Bank that there is no supervisory objection to the program, the Board shall immediately implement, and thereafter ensure adherence to, the terms of the program.
CREDIT RISK RATINGS. (1) Within thirty (30) days of the date of this Agreement, the Board shall take all necessary steps to ensure that the Bank’s loans and other assets are timely and appropriately risk rated and accounted for by the lending officers. Bank management shall provide a written report to be filed with the Board at least quarterly and shall use a loan grading system consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook. Such Board reports shall, at a minimum, provide:
(a) an assessment of the overall quality of the loan portfolio;
(b) the identification, type, rating, and amount of problem loans;
(c) the identification and amount of delinquent loans;
(d) the identification of all nonaccrual loans and leases;
(e) credit and collateral documentation exceptions;
(f) the identification and status of credit related violations of law, rule or regulation;
(g) loans not in conformance with the Bank’s Loan Policy and loans made with approved exceptions to the Bank’s Loan Policy.
(h) concentrations of credit;
(i) loans to affiliates and related parties; and
(j) the identity of the loan officer who originated each loan reported in accordance with subparagraphs (b) through (g) of this Paragraph.
CREDIT RISK RATINGS. (1) Within forty five (45) days of the date of this Agreement, the Board shall review and refine the Bank’s risk rating process to ensure that the risk associated with the Bank’s loans is properly reflected and accounted for on the Bank’s books and records, to include, at a minimum, provisions requiring that:
(a) the Bank’s loans and other assets are appropriately and timely risk rated and charged-off by the lending officers using a loan grading system that is based upon current facts, existing repayment terms and that is consistent with the guidelines set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook;
(b) the Bank’s loan review system provides meaningful, detailed reports to the Board on portfolio quality, risks, and trends; and
(c) loan officers are held accountable for failing to appropriately and timely risk rate loans.
