Common use of CREDIT UNDERWRITING AND ADMINISTRATION Clause in Contracts

CREDIT UNDERWRITING AND ADMINISTRATION. (1) Effective as of the date of this Agreement, the Board shall ensure that all lending officers comply with all laws, rules, regulations, Bank policies and procedures, safe and sound banking practices, and fiduciary duties. (2) Effective as of the date of this Agreement, the Bank may not grant, extend, renew, alter or restructure any loan or other extension of credit equal to or exceeding two hundred fifty thousand dollars ($250,000), without: (a) Documenting the specific reason or purpose for the extension of credit; (b) Identifying the expected source of repayment in writing; (c) Structuring the repayment terms to coincide with the expected source of repayment; (d) Obtaining current and satisfactory credit information, including performing and documenting analysis of credit information and a detailed global cash flow analysis of all expected repayment sources, including an adequate debt service coverage analysis and contingent liabilities for affiliated companies when consolidating global cash flows; (e) Determining and documenting whether the loan complies with the Bank’s Loan Policy and if it does not comply, providing identification of the exception and ample justification to support waiving the policy exception; (f) Making and documenting the determinations made regarding the customer’s ability to repay the credit on the proposed repayment terms; (g) Providing an accurate risk assessment grade; and (h) Documenting, with adequate supporting material, the value of collateral and properly perfecting the Bank’s lien on it where applicable. (3) The Board shall take the necessary steps to ensure that current and satisfactory credit information is maintained on all loans. Within thirty (30) days of notification, the Board shall ensure that the Bank obtains any missing credit information described in the Report of Examination conducted as of September 30, 2010, in any subsequent Report of Examination, in any internal or external loan review, or in any listings of loans lacking such information provided to management by the National Bank Examiners at the conclusion of an examination.