Common use of LOAN RISK RATING SYSTEM Clause in Contracts

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty (120) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 (covered relationship), as assigned by responsible loan officers and by any independent loan reviewer, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet of the Comptroller's Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety (90) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet of the Comptroller's Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty ninety (12090) days, and on an ongoing basis thereafter, the Board must shall ensure that the Bank’s internal risk ratings of commercial credit relationships relationships, including agricultural credits, in excess of $250,000 50,000 (each being a “covered commercial relationship”), as assigned by responsible loan officers and by any independent the Bank’s loan reviewerreview system, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” , A- RCR, booklet of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, the Board must ensure that with respect to the assessment of credit risk of any covered commercial relationship:’s risk (a) the Bank’s primary risk rating consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current an assessment of current value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the Bank’s covered commercial relationship credit risk rating analysis is documented and available for review by the Board and the OCC Comptroller upon request. (2) Within ninety (90) days, and on an ongoing basis thereafter, the Board must ensure that any covered commercial relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt covered commercial relationship is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” , A-RCR, booklet of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty ninety (12090) daysdays from the date of this Agreement, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial or agricultural credit relationships in excess of $250,000 (covered relationship), as assigned by responsible loan officers and by any independent loan reviewer, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the determination of the strength of the borrower’s cash flow is determined through based on current financial information and is limited to analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC Comptroller upon request. (2) Within ninety forty-five (9045) daysdays from the date of this Agreement, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet of the Comptroller's Handbook, the The presence of illiquid collateral or the existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty [ninety (120) 90)] days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of One Hundred Fifty Thousand Dollars ($250,000 150,000) (covered relationship), as assigned by responsible loan officers and by any independent internal loan reviewerreview, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within [ninety (90) )] days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-well- defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness. (3) Within [ninety (90)] days, the Board must establish a credit risk rating management information system that provides, at a minimum, the following information to the Board on a monthly basis: (a) individual detail regarding the identification, type, amount, and assigned rating of all problem loans in excess of One Hundred Fifty Thousand Dollars ($150,000); (b) individual, or summary, detail regarding this same information for all problem loans less than or equal to One Hundred Fifty Thousand Dollars ($150,000); and (c) ratings equivalent to, or readily convertible to, the common regulatory risk rating definitions of pass, special mention, substandard, doubtful and loss set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook. (4) Upon adoption, a copy of the program shall be forwarded to the Assistant Deputy Comptroller for review and determination of no supervisory objection.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty forty five (12045) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 500,000 (covered relationship), as assigned by responsible loan officers and by any independent internal loan reviewerreview, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety forty five (9045) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-well- defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness. (3) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty sixty (12060) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 100,000 (“covered relationship”), as assigned by responsible loan officers and by any independent internal loan reviewerreview, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety sixty (9060) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness. (3) Within sixty (60) days, the Board must establish, implement, and ensure Bank adherence to a credit risk rating management information system that provides, at a minimum, the following information to the Board on a monthly basis: (a) individual detail regarding the identification, type, amount, and assigned rating of all problem loans in excess of $100,000 (one hundred thousand dollars); (b) individual, or summary, detail regarding this same information for all problem loans less than or equal to $100,000 (one hundred thousand dollars); (c) ratings equivalent to, or readily convertible to, the common regulatory risk rating definitions of pass, special mention, substandard, doubtful and loss set forth in the Rating Credit Risk booklet of the Comptroller’s Handbook; and (d) summary loan portfolio data highlighting trends in, and condition of, the quality of loans rated pass.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty thirty (12030) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 (covered relationship), as assigned by responsible loan officers and by any independent loan reviewerreview, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety thirty (9030) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with . (3) The Board shall ensure that the guidance in the “Rating Credit Risk” booklet of the Comptroller's HandbookBank has processes, the presence of illiquid collateral or existence of a plan for improvement does notpersonnel, and a non-government guarantee generally will not, mitigate control systems to ensure implementation of and adherence to the probability of default or a well-defined weaknessprogram developed pursuant to this Article.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty ninety (12090) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial or agricultural credit relationships in excess of $250,000 (covered relationship), as assigned by responsible loan officers and by any independent loan reviewer, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the determination of the strength of the borrower’s cash flow is determined through limited to analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety (90) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-well- defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty thirty (12030) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 100,000 (covered relationship), as assigned by responsible loan officers and by any independent loan reviewer, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety thirty (9030) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness.

LOAN RISK RATING SYSTEM. (1) Within one hundred twenty ninety (12090) days, and on an ongoing basis thereafter, the Board must ensure that the Bank’s internal risk ratings of commercial credit relationships in excess of $250,000 100,000 (covered relationship), as assigned by responsible loan officers and by any independent internal loan reviewerreview, are timely, accurate, and consistent with the regulatory credit classification criteria set forth in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook. At a minimum, the Board must ensure, on an ongoing basis, that with respect to the assessment of credit risk of any covered relationship: (a) the primary consideration is the strength of the borrower’s primary source of repayment (i.e., the probability of default rather than the risk of loss); (b) if the primary source of repayment is cash flow from the borrower’s operations, the strength of the borrower’s cash flow is determined through analysis of the borrower’s historical and projected financial statements, past performance, and future prospects in light of conditions that have occurred; (c) collateral, non-government guarantees, and other similar credit risk mitigants that affect potential loss in the event of default (rather than the probability of default) are taken into consideration only if the primary source of repayment has weakened and the probability of default has increased; (d) collateral values should reflect a current assessment of value based on actual market conditions and project status; (e) credit risk ratings are reviewed and updated whenever relevant new information is received, but no less frequently than annually; and (f) the credit risk rating analysis is documented and available for review by the Board and the OCC upon request. (2) Within ninety (90) days, and on an ongoing basis thereafter, the Board must ensure that any covered relationship with a high probability of payment default or other well-well- defined weakness is rated no better than Substandard, unless the debt is secured by marketable securities or cash. Consistent with the guidance in the “Rating Credit Risk” booklet Risk Booklet, A-RCR, of the Comptroller's ’s Handbook, the presence of illiquid collateral or existence of a plan for improvement does not, and a non-government guarantee generally will not, mitigate the probability of default or a well-defined weakness. (3) Within ninety (90) days, the Board must establish a credit risk rating management information system that provides, at a minimum, the following information to the Board on a monthly basis: (a) individual detail regarding the identification, type, amount, and assigned rating of all problem loans in excess of $100,000 (one hundred thousand dollars); (b) individual, or summary, detail regarding this same information for all problem loans less than or equal to $100,000 (one hundred thousand dollars); and (c) ratings equivalent to, or readily convertible to, the common regulatory risk rating definitions of pass, special mention, substandard, doubtful and loss set forth in Rating Credit Risk, A-RCR, of the Comptroller’s Handbook. (4) Upon adoption, a copy of the program shall be forwarded to the Assistant Deputy Comptroller for review and determination of no supervisory objection.