PROBLEM LOAN IDENTIFICATION. (1) Within sixty (60) days of the date of this Agreement, the Board shall establish an effective problem loan identification program that provides for early identification of emerging and potential problem credits, along with a formal plan to proactively manage these assets. This includes, but is not limited to:
(a) ensuring early problem loan identification and risk rating by loan officers and establishing loan officer accountability for accurately risk rating loans and recognizing nonaccrual loans under their respective supervision in a timely manner;
(b) ensuring timely recognition of accrual status such that non-accrual assets are accurately reflected prior to filing of the Consolidated Reports of Condition and Income;
(c) developing formal loan work out plans for problem credits that include the current status of the loan, current financial condition of the borrower, accrual status, source and date of the collateral valuation, and specific action plans with target dates;
(d) establishing an independent reporting line to the Board or its committee for the internal loan review function; and
(e) ensuring internal loan review provides quarterly reports to the Board, or committee thereof, that shall include, at a minimum, conclusions regarding:
(i) the overall quality of the loan portfolio;
(ii) the identification, type, rating, and amount of problem loans;
(iii) the identification and amount of delinquent loans;
(iv) credit and collateral documentation exceptions;
(v) the identification and status of credit-related violations of law, rule or regulation;
(vi) the identity of the loan officer who originated each loan reported in accordance with subparagraphs (ii) through (v) of this Article;
(vii) concentrations of credit; and
(viii) loans and leases to executive officers, directors, principal shareholders (and their related interests) of the Bank.
(2) 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.
(3) Upon adoption, a copy of the program shall be forwarded to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection. Upon receiving a determination of no supervisory objection from the Assistant Deputy Comptroller, the Bank shall implement and adhere to the program.
PROBLEM LOAN IDENTIFICATION. (1) The Board shall within ninety (90) days employ or designate a sufficiently experienced and qualified person(s) or firm to ensure the timely and independent identification of problem loans and leases.
(2) Within ninety (90) days, the Board shall establish an effective, independent and on-going loan review system to review, at least quarterly, the Bank's loan and lease portfolios to assure the timely identification and categorization of problem credits. The system shall provide for a written report to be filed with the Board after each review and shall use a loan and lease grading system consistent with the guidelines set forth in “Rating Credit Risk” and “Allowance for Loan and Lease Losses” booklets of the Comptroller’s Handbook. Such reports shall include, at a minimum, conclusions regarding:
(a) the overall quality of the loan and lease portfolios;
(b) the identification, type, rating, and amount of problem loans and leases;
(c) the identification and amount of delinquent loans and leases;
(d) credit and collateral documentation exceptions;
(e) the identification and status of credit related violations of law, rule or regulation;
(f) the identity of the loan officer who originated each loan reported in accordance with subparagraphs (b) through (e) of the Article;
(g) concentrations of credit;
(h) loans and leases to executive officers, directors, principal shareholders (and their related interests) of the Bank; and
(i) loans and leases not in conformance with the Bank's lending policies, and exceptions to the Bank’s lending and leasing policies.
(3) Within ninety (90) days, the Board shall develop, implement, and thereafter ensure Bank adherence to a written program providing for independent review of problem loans and leases in the Bank's loan and lease portfolios for the purpose of monitoring portfolio trends, on at least a quarterly basis. The program shall require a quarterly report to the Board. At a minimum the program shall provide for an independent reviewer’s assessment of the Bank’s:
(a) monitoring systems for early problem loan identification to assure the timely identification and rating of loans and leases based on lending officer submissions;
(b) statistical records that serve as a basis for identifying sources of problem loans and leases by industry, size, collateral, division, group, indirect dealer, and individual lending officer;
(c) system for monitoring previously charged-off assets and their recovery potential;
(d) system for mon...
PROBLEM LOAN IDENTIFICATION. (1) Within sixty (60) days of the date of this Agreement, the Board shall establish an effective problem loan identification program that provides for early identification of emerging and potential problem credits, along with a formal plan to proactively manage these assets. This includes, but is not limited to:
(a) ensuring early problem loan identification and risk rating by loan officers and establishing loan officer accountability for accurately risk rating loans and recognizing nonaccrual loans under their respective supervision in a timely manner;
(b) ensuring all employees are provided with adequate training on regulatory risk rating definitions as well as guidelines for risk rating credits;
(c) procedures requiring loan officers and credit administration employees to provide narrative to support all assigned risk ratings, including the credit’s primary source of repayment, guarantor support, collateral protection, and triggers that could result in a rating upgrade or downgrade; and,
(d) developing formal loan work out plans for problem credits that include the current status of the loan, current financial condition of the borrower, accrual status, source and date of the collateral valuation, and specific action plans with target dates.
(2) Upon adoption, a copy of the program shall be forwarded to the Assistant Deputy Comptroller for review and prior written determination of no supervisory objection. Upon receiving a determination of no supervisory objection from the Assistant Deputy Comptroller, the Bank shall implement and adhere to the program.
PROBLEM LOAN IDENTIFICATION. (1) Within ninety (90) days, the Board shall review, revise, and thereafter ensure Bank adherence to a program to ensure lending officers identify in a timely and accurate manner nonaccrual loans and loans rated "Special Mention", "Substandard", "Doubtful", and "Loss." An acceptable program shall include:
(a) Providing training to lending staff on recognition of nonaccrual loans and loan grading within ninety (90) days, with subsequent refresher training as needed; and
(b) Ensuring officer accountability by including accuracy and timeliness of recognition of nonaccrual loans and loan grading in the annual performance evaluation of each loan officer and each member of lending area management.
(2) In order to ensure the accuracy and timeliness of recognition of nonaccural loans and the loan ratings assigned, the Board shall increase the frequency of internal loan review from annual to a risk-based approach.
(3) The Board shall ensure the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article.
PROBLEM LOAN IDENTIFICATION. (1) Within forty-five (45) days, the Board shall develop and implement a written program to ensure that the Bank’s officers and employees are timely identifying and accurately risk rating assets. At a minimum, the program implemented pursuant to this Article shall require the following:
(a) accurate and timely risk rating of loans and other assets by bank officers and employees using a loan grading system that is based upon current facts and existing repayment terms, and that is consistent with the guidelines set forth in the Comptroller’s Handbook - Rating Credit Risk;
(b) timely placement of loans and other assets on a nonaccrual status by the lending officers in accordance with the guidelines set forth in the Reports of Condition and Income (“Call Report”) Instructions; and,
(c) establishment of training programs for affected personnel to ensure the accurate and timely identification of criticized loans.
(2) The Board shall within ninety (90) days employ or designate a sufficiently experienced and qualified person(s) or firm to ensure the timely and independent identification of problem loans and leases.
(3) A written description of the program called for in this article shall be forwarded to the Assistant Deputy Comptroller upon implementation.
(4) 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.
PROBLEM LOAN IDENTIFICATION. (1) Within thirty (30) days, the Board shall review, revise, and thereafter ensure Bank adherence to a program to ensure lending officers identify in a timely and accurate manner nonaccrual loans and loans rated "Special Mention", "Substandard", "Doubtful", and "Loss." An acceptable program shall include:
(a) Providing training to lending staff on recognition of nonaccrual loans and loan grading, with subsequent refresher training as needed;
(b) Remedying any problem loan identification deficiencies identified in the current or any future XXX, including the identified deficient related to risk rating accuracy, problem loan administration, and policy exceptions; and
(c) Requiring that lending officers and senior management are assigned responsibility and held accountable (to include, at a minimum, consideration in periodic performance reviews and compensation) for ensuring that the Bank’s loans and other assets are appropriately and timely risk rated, charged off and/or placed on nonaccrual.
(2) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to this Article and the programs developed pursuant to it.
PROBLEM LOAN IDENTIFICATION. (1) Within ninety (90) days, the Board shall:
(a) Implement a program to ensure lending officers identify loans rated "Special Mention", "Substandard", "Doubtful", and "Loss" in a timely and accurate manner. The program shall include:
(i) Providing training to lending staff on loan grading within ninety (90) days and subsequent refresher training as needed; and
(ii) Ensuring officer accountability by including accuracy and timeliness of loan grading in the annual performance evaluation of each loan officer and each member of lending area management.
(b) In order to ensure loan ratings assigned by officers are correct and current, the Board shall increase the frequency of internal loan review from annual to a risk-based approach.
(c) The Board shall ensure the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article.
(d) The Board shall evaluate the internal loan review report(s) and shall ensure immediate, adequate, and continuing remedial action, if appropriate, is taken upon all findings noted in the report(s).
(e) A copy of the report(s) submitted to the Board, as well as documentation of the action taken by the Bank to collect or strengthen assets identified as problem credits, shall be preserved in the Bank.
PROBLEM LOAN IDENTIFICATION. (1) Within thirty (30) days, the Board shall review, revise, and thereafter ensure Bank adherence to a program to ensure lending officers identify in a timely and accurate manner nonaccrual loans and loans rated "Special Mention", "Substandard", "Doubtful", and "Loss." An acceptable program shall include:
(a) Providing training to lending staff on recognition of nonaccrual loans and loan grading, with subsequent refresher training as needed; and
(b) Remedying any problem loan identification or loan review deficiencies identified in the current or any future XXX.
(2) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to this Article and the programs developed pursuant to it.
PROBLEM LOAN IDENTIFICATION. (1) Within ninety (90) days, the Board shall develop and implement a written program to ensure that the Bank’s officers and employees are timely identifying and accurately risk rating assets. At a minimum, the program implemented pursuant to this Article shall require the following:
(a) accurate and timely risk rating of loans and other assets by bank officers and employees using a loan grading system that is based upon current facts and existing repayment terms, and that is consistent with the guidelines set forth in the Comptroller’s Handbook – Rating Credit Risk;
(b) timely placement of loans and other assets on a nonaccrual status by the lending officers in accordance with the guidelines set forth in the Reports of Condition and Income (“Call Report”) Instructions; and;
(c) establishment of training programs for affected personnel to ensure the accurate and timely identification of criticized loans.
(2) A copy of the reports submitted to the Board, as well as documentation of the action taken by the Bank to collect or strengthen assets identified as problem credits, shall be preserved in the Bank.
(3) Within ninety (90) days, the Board shall develop, implement, and thereafter ensure Bank adherence to systems which provide for effective monitoring of early problem loan identification to assure the timely identification and rating of loans and leases, based on lending officer submissions.
PROBLEM LOAN IDENTIFICATION. (1) Within ninety (90) days, the Bank shall have in place appropriate policies and procedures designed to ensure that the Bank’s internal risk ratings, as assigned by responsible loan officers and the independent loan review, are timely, accurate and consistent with the regulatory classifications of credit criteria set forth in the Rating Credit Risk Booklet of the Comptroller’s Handbook.
(2) Within ninety (90) days, the Bank shall have in place appropriate policies and procedures designed to ensure that any credit relationship exceeding $100,000 with a high probability of payment default or other well-defined weakness is rated no better than Substandard, unless the loan is secured by marketable collateral, or cash, consistent with the guidance in the Rating Credit Risk Booklet of the Comptrollers Handbook.
