PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall contain, at a minimum, analysis and documentation of the following: (a) a complete credit history, to include, at a minimum: (i) loan origination date; (ii) loan purpose; (iii) grade history, including the reason for any grade change; (iv) any material changes since the previous CAR was filed; (b) an identification of the expected sources of repayment; (c) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation; (d) an analysis of current and satisfactory credit information, to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problems; (e) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment; (f) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and (g) for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include: (i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date; (ii) project development status; (iii) a comparison of development costs to the budgeted amount; (iv) a comparison of sales activity to the original sales projections; (v) current market conditions and activity; (vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve; (vii) an assessment of the borrower’s global cash flow; (viii) an assessment of the guarantor’s ability to support the project; and (ix) any other significant information relating to the project. (3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans. (4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed $200,000, unless each of the following conditions is met: (a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and (b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromised. (5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, for submission and review of reports of all criticized credit relationships totaling $200,000 100,000 or above. The revised CARs shall contain, that require, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repayment;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and
(gf) for criticized relationships of $200,000 100,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed one-hundred thousand dollars ($200,000, 100,000) unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the full Board or a designated committee thereof approves the credit extension and documents records, in writing, the reasons that why such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromised.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, for quarterly submission and review of reports of all criticized credit asset relationships totaling two-hundred and fifty thousand dollars ($200,000 250,000) or above. The revised CARs shall contain, that require, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repayment;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable applicable, as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and
(gf) documented support for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development accrual status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed two-hundred and fifty thousand dollars ($200,000, 250,000) unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the full Board or a designated committee thereof approves the credit extension and documents records, in writing, the reasons that why such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromised.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this AgreementWithin forty-five (45) days, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXXreview, in any subsequent Report concert with Article III, the demonstrated experience and skills of Examination, by internal or external loan review, or in any list provided to management by those individuals that have responsibility for managing problem commercial loans and the National Bank Examiners during any examinationBoard will determine whether outside expertise is necessary for more complex commercial and commercial real estate borrowers and transactions.
(2) The Board’s compliance with Paragraph Within ninety (190) of this Article days, the Board shall include the development of enhancements to the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, create and implement a problem loan management policies and procedures that sets a hierarchy for all criticized credit relationships totaling $200,000 or above. The revised CARs shall contain, at a minimum, analysis and documentation of the followingloans that establishes:
(a) a complete credit historyearly intervention guidelines;
(b) minimum workout plan requirements;
(c) the frequency and content of reports to the Board; and
(d) guidelines for advancing funds and approving renewed or restructured loans.
(3) Within ninety (90) days, to the Board shall ensure that workout plans are created for all criticized commercial loans that equal or exceed two hundred and fifty thousand dollars (250,000). The workout plans will include, at a minimum:
(ia) a summary of the loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for exposure and guarantors and any grade change;
(iv) any material changes since the previous CAR was filedrelated debt;
(b) an identification summary of the expected sources collateral, condition, and date of repaymentvaluation;
(c) the appraised value of supporting collateral risk rating and support for the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuationrating;
(d) an analysis determination of current accrual and satisfactory impairment status;
(e) a synopsis of the financial condition of the borrower and guarantor, if applicable;
(f) comments to address the appropriateness of any charge-off amounts or specific allocations consistent with accounting standard A.S.C. 310-10, Receivables – Allowance for Credit Losses;
(g) a detailed plan to address the primary concerns, including borrower contact and collateral valuations;
(h) determination of whether or not the loan qualifies as a Troubled Debt Restructuring based on recent actions;
(i) due dates and timeframes for follow-up; and
(j) triggers that would result in a downgrade or upgrade of classification or a change in the accrual status.
(4) Within thirty (30) days, the Board shall develop, implement, and thereafter ensure Bank adherence to systems which provide for effective monitoring of:
(a) early problem loan identification to assure the timely identification and rating of loans and leases based on lending officer submissions;
(b) statistical records that will 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) previously charged-off assets and their recovery potential;
(d) compliance with the Bank's lending policies and laws, rules, and regulations pertaining to the Bank's lending function;
(e) adequacy of credit informationand collateral documentation;
(f) independent ongoing credit review and appropriate communication to management and the Board of Directors; and
(g) concentrations of credit.
(5) Within ninety (90) days, to includeon a monthly basis management will provide the Board with written reports including, at a minimum, the timely analysis of tax returnsfollowing information:
(a) the identification, financial statementstype, news reports, global cash flow, contingent liabilitiesrating, and other indicators amount of possible problemsproblem loans and leases;
(b) the identification and amount of delinquent loans and leases;
(c) credit and collateral documentation exceptions;
(d) the identification and status of credit related violations of law, rule or regulation;
(e) the proposed action to eliminate identity of the basis loan officer who originated each loan reported in accordance with subparagraphs (a) through (d) of criticism this Article and the time frame for its accomplishment;Paragraph; and
(f) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and
(g) for criticized relationships an analysis of $200,000 or above that were made for the purpose concentrations of constructing or developing CREcredit, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewalssignificant economic factors, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market general conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed $200,000, unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves their impact on the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests quality of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedloan and lease portfolios.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Within thirty (30) days of the date of this Agreement, the Board shall establish a plan designed to reduce the volume of problem assets by ensuring that management promptly addresses and intervenes, as appropriate, to resolve problem credit situations consistent with OCC Banking Circular 255.
(2) The Board’s compliance with paragraph (1) of this Article shall include the development and implementation of policy guidance setting forth actions that management will take to strengthen or reduce problem loans, including, at a minimum, guidelines on the following:
(a) Extensions or renewals of construction and development loans;
(b) The use of interest reserves after initial loan term;
(c) The curtailment or re-margining of outstanding loan balances upon renewal or extension; and
(d) The freezing of loan commitments on problem loans.
(3) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets on the Bank’s criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examinationlist.
(24) The Board’s compliance with Paragraph Within thirty days (30) of establishing the plan required by paragraph (1) of this Article , the Board shall prepare and submit to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection, a written program designed to reduce the Bank’s classified assets (the “Problem Assets Program”). The Problem Assets Program shall include the development of enhancements policies and procedures designed to the Bank’s Criticized Asset Reports ensure that Problem Loan Memoranda (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall “PLM”) contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an An identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the The appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an An analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the The proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger Trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual;
(f) A determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan; and
(g) for For criticized relationships of $200,000 250,000 or above that were made for the purpose of constructing or developing CREabove, the reports PLM shall also include:
(i) the The initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project Project development status;
(iii) a A comparison of development costs to the budgeted amount;
(iv) a A comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount Amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(viivi) an An assessment of the borrower’s global cash flow;
(viiivii) an An assessment of the any guarantor’s ability to support the projectglobal cash flow; and
(ixviii) any Any other significant information relating to the project.
(35) The CARs Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the program required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loansArticle.
(46) A copy of each PLM prepared during the month of each quarter end (e.g., March, June, September, and December), along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the OREO, shall be submitted to the Assistant Deputy Comptroller within fifteen (15) days of each calendar quarter end.
(7) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are on the Bank’s criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed of credit equal or $200,000250,000, unless each of the following conditions is met:
(a) the The Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the The Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Within thirty (30) days of the date of this Agreement, the Board shall establish a plan that will reduce the volume of problem assets by ensuring that management promptly addresses and intervenes, as appropriate, to resolve problem credit situations consistent with OCC Banking Circular 255.
(2) The Board’s compliance with paragraph (1) of this Article shall include the development and implementation of policy guidance setting forth actions that management will take to strengthen or reduce problem loans, including, at a minimum, guidelines on the following:
(a) Extensions or renewals of construction and development loans;
(b) The use of interest reserves after initial loan term;
(c) The curtailment or re-margining of outstanding loan balances upon renewal or extension; and
(d) The freezing of loan commitments on problem loans.
(3) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets on the Bank’s criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examinationlist.
(24) The Board’s compliance with Paragraph Within thirty days (30) of establishing the plan required by paragraph (1) of this Article , the Board shall prepare and submit to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection, a written program designed to reduce the Bank’s classified assets (the “Problem Assets Program”). The Problem Assets Program shall include the development of enhancements policies and procedures to the Bank’s Criticized Asset Reports ensure that Problem Loan Memoranda (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall “PLM”) contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an An identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the The appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an An analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the The proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger Trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual;
(f) A determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan; and
(g) for For criticized relationships of $200,000 250,000 or above that were made for the purpose of constructing or developing CREabove, the reports PLM shall also include:
(i) the The initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project Project development status;
(iii) a A comparison of development costs to the budgeted amount;
(iv) a A comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount Amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(viivi) an An assessment of the borrower’s global cash flow;
(viiivii) an An assessment of the any guarantor’s ability to support the projectglobal cash flow; and
(ixviii) any Any other significant information relating to the project.
(35) The CARs Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the program required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loansArticle.
(46) A copy of each PLM prepared during the month of each quarter end (e.g., March, June, September, and December), along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the OREO, shall be submitted to the Assistant Deputy Comptroller within fifteen (15) days of each calendar quarter end.
(7) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are on the Bank’s criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed of credit equal or $200,000250,000, unless each of the following conditions is met:
(a) the The Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the The Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, for quarterly submission and review of reports of all criticized credit relationships or Other Real Estate (“ORE”) totaling one hundred thousand dollars ($200,000 100,000) or above. The revised CARs shall more, and that require the preparation of Problem Asset Reports (“PARs” or “PAR”) that contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable applicable, as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the current grade and proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual; and
(g) for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iiif) a comparison determination of development costs to whether the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve loan is impaired and the amount of any subsequent additions to the reserve;
impairment, consistent with Accounting Standards Codification 310-10 (viiformerly known as FAS Statement of Financial Accounting Standards No. 114) an assessment and Accounting Standards Codification 450-20 (formerly known as FAS Statement of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the projectFinancial Accounting Standards No. 5, Accounting for Contingencies).
(3) The CARs required by Paragraph A copy of each PAR prepared during the month of each quarter end (2e.g., March, June, September, and December), along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the ORE, shall be submitted to the Assistant Deputy Comptroller within fifteen (15) days of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loanseach calendar quarter end.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions of credit equal or exceed one hundred thousand dollars ($200,000100,000), unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as Within thirty (30) days of the date of this Agreement, the Board Bank shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of ExaminationXXX, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination.
(2) The Board’s compliance with Paragraph Within ninety (190) days of the date of this Article Agreement, the Board shall establish a Problem Loan Management Program for the purpose of restoring and reclaiming classified assets, including commercial loans, consistent with Appendix F of the Real Estate and Construction Lending Booklet of the Comptroller’s Handbook (formerly OCC Banking Circular 255), and reducing the level of criticized loans of the Bank.
(3) Within one hundred and twenty (120) days of the date of this Agreement, the Problem Loan Management Program shall include the development and implementation of enhancements a written action plan for each criticized lending relationship with an aggregate exposure to the Bank’s Criticized Asset Reports Bank exceeding one hundred fifty thousand dollars (CARs$150,000), each such plan to be submitted monthly updated at least quarterly and with action plans and updated action plans reported to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall contain, at a minimum, analysis and documentation of the following:Compliance Committee;
(a4) a complete credit history, to Written action plans required by this Article shall include, at a minimum:
(ia) a summary of loan origination date;
(ii) loan purpose;
(iii) grade historyexposure, including the reason for guarantors and any grade change;
(iv) any material changes since the previous CAR was filedrelated debt;
(b) an identification of the expected sources source of repayment;
(c) the appraised value summary of supporting collateral collateral, condition and date of valuation;
(d) the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuationapplicable;
(de) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ef) the risk rating and support for the rating;,
(g) a list of the proposed action actions to be taken to eliminate the basis of criticism and the time frame for its accomplishmentaccomplishment of each action on the list;
(fh) trigger dates for positive borrower actions or for loan officers to reassess an analysis of whether the strategy and enact collection plansrelationship constitutes a troubled debt restructuring under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 310-40 (pre-codification reference: Statement of Financial Accounting Standards (“FAS”) Statement No. 114); and
(g) for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, contact information for each borrower and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(35) The CARs required by Paragraph Within ninety (290) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as days of the date of this Agreement, the Bank may not extend credit, directly or indirectlyBoard shall develop and implement policies and procedures governing the administration of problem loans, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed $200,000, unless each of the following conditions is metbut not limited to:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; andearly intervention guidelines;
(b) minimum workout plan requirements;
(c) the frequency and content of reports to the Board’s formal plan to collect ;
(d) guidelines for advancing funds and approving renewed or strengthen restructured loans;
(e) establishing when collateral securing a criticized loan must be reappraised or reevaluated;
(f) ensuring the criticized asset will not be compromisedaccuracy of classifications resulting after consideration of OCC Bulletin 2000-20; and,
(g) establishing the method by which the effectiveness of loan workout efforts are reviewed and assessed by the loan review consultant engaged for periodic reviews under Article IV of this Agreement.
(56) The Within thirty (30) days of the date of this Agreement, the Board shall conduct a reviewshall, on at least a monthly basis, subject to determine the status of all criticized assets and Bank management’s adherence to the requirements Paragraph (7) of this Article, employ a consultant or consultants qualified to assess the effectiveness of the Problem Loan Management Program on an ongoing quarterly review. The consultant shall be utilized until such time as the Problem Loan Management Program is developed by the Board, implemented and demonstrated to be effective.
(7) Prior to the appointment or employment of any loan review consultant, loan workout specialist, or entering into any contract with a consultant or loan workout specialist, the Board shall submit the name and qualifications of the proposed consultant and the proposed terms of employment to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection.
(8) Before terminating the consultant's assessment of the effectiveness of the Problem Loan Management Program, the Board shall both certify the effectiveness of the Problem Loan Management Program, and receive prior written determination of no supervisory objection from the Assistant Deputy Comptroller.
(9) The requirement to submit information and the provisions for prior written determination of no supervisory objection in this Article are based on the authority of 12 U.S.C. § 1818(b) and do not require the Comptroller or the Assistant Deputy Comptroller to complete his/her review and act on any such information or authority within ninety (90) days.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by in any subsequent internal or external loan review, or in any list provided to management by the National Bank Examiners during any subsequent examination.
(2) The Board’s compliance with Paragraph Within sixty (160) days, the Board shall develop written procedures for the quarterly submission and review of this Article shall include the development of enhancements to the Bank’s Criticized Problem Asset Reports (CARs), to be submitted monthly to the Board, “PARs” or “PAR”) for all criticized and classified credit relationships totaling two hundred fifty thousand dollars ($200,000 250,000) or abovemore. The revised CARs PARs shall contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral collateral, where applicable applicable, as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including a cash flow analysis where loans are to include, at a minimum, be repaid from operations;
(d) an assessment of the timely analysis of tax returns, financial statements, news reports, borrower’s global cash flow, contingent liabilities, and other indicators of possible problems;
(e) an assessment of any guarantor’s global cash flow;
(f) the current accrual status and the appropriateness of the current accrual status,
(g) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fh) the identification of prior charge-offs or date of nonaccrual identification, if applicable;
(i) the terms of any forbearance or restructure agreements, if applicable;
(j) a summary of relevant communications with the borrower, including an assessment of these communications as they relate to collectability or the borrower’s willingness to cooperate with the Bank;
(k) trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans; and, and make appropriate downgrades or place the loan on nonaccrual;
(gl) a determination of whether the loan is impaired and the amount of the impairment, consistent with Accounting Standards Codification 310-10 (formerly known as FASB Statement of Financial Accounting Standards No. 114);
(m) for criticized relationships of two hundred fifty thousand dollars ($200,000 250,000) or above that were made for the purpose of constructing or developing CREcommercial real estate, the reports PARs shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ixvi) any other significant information relating to the project;
(n) an evaluation of the progress made in the last quarter.
(3) The CARs required by Paragraph A copy of each PAR prepared along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit shall be available for the inspection of the OCC’s National Bank Examiners within thirty (230) days after the end of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loanseach calendar quarter.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any subsequent internal or external loan review, review or in any subsequent list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions of credit equal or exceed two hundred fifty thousand dollars ($200,000250,000), unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Within thirty (30) days of this Agreement, the Board shall adopt, implement, and thereafter ensure adherence to a written plan to reduce the volume of problem assets by ensuring that management promptly addresses and intervenes, as appropriate, to resolve problem credit situations consistent with OCC Banking Circular 255.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development and implementation of policy guidance setting forth actions that management will take to strengthen or reduce problem loans, including, at a minimum, guidelines on the following:
(a) extensions or renewals of construction and development loans;
(b) the use of interest reserves after initial loan term;
(c) the curtailment or re-margining of outstanding loan balances upon renewal or extension; and
(d) the freezing of loan commitments on problem loans.
(3) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized listed in the XXX, in any subsequent Report of Examination, by internal or external Bank’s criticized loan review, or in any list provided to management by the National Bank Examiners during any examinationlist.
(24) The Board’s compliance with Within thirty (30) days of establishing the plan required by Paragraph (1) of this Article Article, the Board shall prepare and submit to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection, a written program designed to reduce the Bank’s criticized assets (the “Problem Assets Program”). The Problem Assets Program shall include the development of enhancements policies and procedures to the Bank’s Criticized Asset Reports ensure that Problem Loan Memoranda (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall “PLM”) contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual;
(f) a determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan; and
(g) for criticized relationships of $200,000 250,000 or above that were made for the purpose of constructing or developing CREabove, the reports PLM shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(viivi) an assessment of the borrower’s global cash flow;
(viiivii) an assessment of the any guarantor’s ability to support the projectglobal cash flow; and
(ixviii) any other significant information relating to the project.
(35) The CARs Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the program required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loansArticle.
(46) A copy of each PLM prepared during the month of each quarter end (e.g., March, June, September, and December), along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the OREO, shall be submitted to the Assistant Deputy Comptroller within fifteen (15) days of each calendar quarter end.
(7) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed of credit equal to or exceeding $200,000250,000, unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by in any subsequent internal or external loan review, review or in any list provided to management by the National Bank Examiners during any subsequent examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized quarterly submission and review of Problem Asset Reports (CARs), to be submitted monthly to the Board, for “PARs” or “PAR”) of all criticized credit relationships or Other Real Estate (“ORE”) totaling two hundred fifty thousand dollars ($200,000 250,000) or abovemore. The revised CARs PARs shall contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation, as directed by Article VI of this Agreement;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, be repaid from operations;
(d) an assessment of the timely analysis of tax returns, financial statements, news reports, borrower’s global cash flow, contingent liabilities, and other indicators of possible problems;
(e) an assessment of any guarantor’s global cash flow;
(f) the current grade and proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fg) trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans; and, and make appropriate downgrades or place the loan on nonaccrual;
(gh) a determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan;
(i) for criticized relationships of two hundred fifty thousand dollars ($200,000 250,000) or above that were made for the purpose of constructing or developing CREcommercial real estate, the reports PARs shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ixvi) any other significant information relating to the project; and
(j) an evaluation of the progress made in the last quarter.
(3) The CARs required by Paragraph Within thirty (230) days of the end of each calendar quarter, the Bank shall assess the overall progress made pursuant to this article shall cover Article and determine appropriateness of the entire credit relationship, rather than the current process of generating separate reports for individual loansactions taken pursuant to this Article.
(4) A copy of each PAR prepared along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the ORE, and the assessment made pursuant to Paragraph (3) of this Article, shall be available upon request for the inspection of the National Bank Examiners.
(5) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any subsequent internal or external loan review, review or in any subsequent list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions of credit equal or exceed two hundred fifty thousand dollars ($200,000250,000), unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, writing the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Within thirty (30) days of the date of this Agreement, the Board shall establish a plan that will reduce the volume of problem assets by ensuring that management promptly addresses and intervenes, as appropriate, to resolve problem credit situations consistent with OCC Banking Circular 255.
(2) The Board’s compliance with paragraph (1) of this Article shall include the development and implementation of policy guidance setting forth actions that management will take to strengthen or reduce problem loans, including, at a minimum, guidelines on the following:
(a) Extensions or renewals of construction and development loans;
(b) The use of interest reserves after initial loan term;
(c) The curtailment or re-margining of outstanding loan balances upon renewal or extension; and
(d) The freezing of loan commitments on problem loans.
(3) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets on the Bank’s criticized in the XXX, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examinationlist.
(24) The Board’s compliance with Paragraph Within thirty days (30) of establishing the plan required by paragraph (1) of this Article Article, the Board shall prepare and submit to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection, a written program designed to reduce the Bank’s classified assets (the “Problem Assets Program”). The Problem Assets Program shall include the development of enhancements policies and procedures to the Bank’s Criticized Asset Reports ensure that Problem Loan Memoranda (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall “PLM”) contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an An identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the The appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an An analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the The proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger Trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual;
(f) A determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan; and
(g) for For criticized relationships of $200,000 250,000 or above that were made for the purpose of constructing or developing CREabove, the reports PLM shall also include:
(i) the The initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project Project development status;
(iii) a A comparison of development costs to the budgeted amount;
(iv) a A comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount Amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(viivi) an An assessment of the borrower’s global cash flow;
(viiivii) an An assessment of the any guarantor’s ability to support the projectglobal cash flow; and
(ixviii) any Any other significant information relating to the project.
(35) The CARs Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the program required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loansArticle.
(46) A copy of each PLM prepared during the month of each quarter end (e.g., March, June, September, and December), along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the OREO, shall be submitted to the Assistant Deputy Comptroller within fifteen (15) days of each calendar quarter end.
(7) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are on the Bank’s criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed of credit equal or $200,000250,000, unless each of the following conditions is met:
(a) the The Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the The Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXX, in any subsequent Report of Examination, by in any subsequent internal or external loan review, review or in any list provided to management by the National Bank Examiners during any subsequent examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include include, within thirty (30) days of this Agreement, the development of enhancements to procedures for the Bank’s Criticized quarterly submission and review of Problem Asset Reports (CARs), to be submitted monthly to the Board, for “PARs” or “PAR”) of all criticized credit relationships or OREO totaling two hundred thousand dollars ($200,000 200,000) or abovemore. The revised CARs PARs shall contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repayment;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable applicable, as well as other necessary documentation to support the collateral valuation, as directed by Article VIII of this Agreement;
(dc) an analysis of current and satisfactory credit information, including a cash flow analysis where loans are to include, at a minimum, be repaid from operations;
(d) an assessment of the timely analysis of tax returns, financial statements, news reports, borrower’s global cash flow, contingent liabilities, and other indicators of possible problems;
(e) the proposed action to eliminate the basis an assessment of criticism and the time frame for its accomplishmentany guarantor’s global cash flow;
(f) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and
(g) for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(iig) the current accrual status, its appropriateness, and the date of nonaccrual identification, if applicable;
(h) the amounts and dates of prior charge offs, if applicable;
(i) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(j) the terms of the forbearance or restructure agreements, if applicable;
(k) a summary of relevant communications with the borrower, including an assessment of these communications as they relate to collectability or the borrower’s willingness to cooperate with the Bank;
(l) trigger dates for positive borrower actions or for loan officers to reassess the strategy, enact collection plans, and make appropriate downgrades or place on nonaccrual;
(m) a determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan;
(n) for criticized relationships of two hundred thousand dollars ($200,000) or above that were made for the purpose of constructing or developing commercial real estate, the PARs shall also include:
(i) project development status;
(iiiii) a comparison of development costs to the budgeted amount;
(iviii) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(viiv) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ixv) any other significant information relating to the project;
(o) an evaluation of the progress made in the last quarter.
(3) The CARs required by Paragraph A copy of each PAR prepared along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the OREO shall be submitted to the Assistant Deputy Comptroller within thirty (230) days after the end of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loanseach calendar quarter.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any subsequent internal or external loan review, review or in any subsequent list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions of credit equal or exceed two hundred thousand dollars ($200,000), unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional interest on the credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those classified or special mention assets criticized in the XXXidentified by OCC examiners, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination(hereafter, the “problem assets”).
(2) The Board’s compliance By June 30, 2024, the Board shall develop written procedures with Paragraph assigned responsibility for the quarterly submission and review of reports of all problem assets (1) of this Article “PAR”). Each PAR shall include the development of enhancements to the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs shall containrequire, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the current expected sources of repayment;
(b) historical payment history and current payment status;
(c) detailed collateral information, including, as applicable, the appraised current value of supporting collateral collateral, the condition of the collateral, and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuationposition;
(d) an analysis status of property tax payments and business registrations;
(e) up to date information regarding communication between the borrower and the SBA and/or USDA, if applicable;
(f) workout strategies or concessions made to the terms of the credit, if any, and how doing so will improve the problem credit;
(g) trigger dates for borrower actions or for loan officer reassessment of strategy and enactment of collection plans;
(h) the root causes of the credit weakness;
(i) current and satisfactory credit information, to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problems;
(ej) a determination of whether the proposed action to eliminate the basis of criticism loan is impaired and the time frame for its accomplishmentimpairment amount, consistent with generally accepted accounting principles (“GAAP”);
(fk) a breakdown of any credit exposures subject to split classifications;
(l) analysis and reasoning to support the current risk rating along with specific action plans and trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plansrisk rating changes; and
(g) for criticized relationships of $200,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iiim) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management at least quarterly, by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed $200,000, unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that to:
(i) measure progress and reevaluate the extension of additional credit is necessary to promote the best interests suitability of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bankaction plans; and
(bii) document the Boardeffectiveness of the responsible officer’s formal plan efforts to collect or strengthen eliminate the criticized weakness in each problem asset will not be compromisedrelationship.
(53) The Board shall conduct a review, on at least a monthly basis, A copy of each PAR prepared pursuant to determine the status of all criticized assets and Bank management’s adherence to the requirements Paragraph (2) of this Article, along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each problem asset, shall be submitted to the Assistant Deputy Comptroller within forty-five (45) days of each calendar quarter end.
Appears in 1 contract
Samples: Compliance Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those classified and special mention assets criticized in the XXXidentified by OCC examiners, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination(hereafter, the “problem assets”).
(2) The Board’s compliance with Paragraph Within ninety (190) days of the date of this Article Agreement, the Board shall include develop written procedures with assigned responsibility for the development quarterly submission and review of enhancements to the Bank’s Criticized Asset Reports reports of all problem assets totaling one hundred thousand dollars (CARs$100,000) or above (“PAR”), to be submitted monthly to the Board, for all criticized credit relationships totaling $200,000 or above. The revised CARs Each PAR shall containrequire, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the current expected sources of repayment;
(cb) detailed collateral information, including, as applicable, the appraised current value of supporting collateral collateral, the condition of the collateral, and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation position;
(c) concessions made to support the collateral valuationterms of the credit, if any, and how doing so will improve the problem credit;
(d) an analysis trigger dates for borrower actions or for loan officer reassessment of current strategy and satisfactory credit information, to include, at a minimum, the timely analysis enactment of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemscollection plans;
(e) the proposed action to eliminate root causes of the basis of criticism and the time frame for its accomplishmentcredit weakness;
(f) current and satisfactory credit information;
(g) a determination of whether the loan is impaired and the impairment amount, consistent with generally accepted accounting principles (“GAAP”);
(h) analysis and reasoning to support the current risk rating along with specific action plans and trigger dates for positive borrower actions risk rating changes; and
(i) a review, at least quarterly, by the Board or for loan officers to reassess a designated committee thereof to:
(i) measure progress and reevaluate the strategy and enact collection suitability of the action plans; and
(gii) for criticized relationships of $200,000 or above that were made for document the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date effectiveness of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs responsible officer’s efforts to eliminate the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the projectweakness in each problem asset relationship.
(3) The CARs required by A copy of each PAR prepared pursuant to Paragraph (2) of this article Article, along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each problem asset, shall cover be submitted to the entire credit relationship, rather than the current process Assistant Deputy Comptroller within forty-five (45) days of generating separate reports for individual loanseach calendar quarter end.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including overdrafts, renewals, extensions of the payment or principal due date, or capitalization of accrued interest, but excluding advances on previously approved lines of credit, to a borrower whose loans or other extensions of credit are criticized in considered problem assets by the XXXOCC examiners, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination Bank, and whose aggregate loans or other extensions of credit, exceed two hundred fifty thousand dollars ($200,000, 250,000) unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the full Board or a designated committee thereof approves the credit extension and documents extension;
(b) the Board explains in writing, writing how the reasons that such credit extension is necessary to promote the best interests of the Bank; and;
(bc) the Board explains in writing how the credit extension will not compromise the Board’s formal plan to collect or strengthen the criticized asset will not be compromised.problem asset; and
(5d) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank managementBoard’s adherence to written determinations required by this Article are maintained in the requirements of this Articleborrower’s credit file.
Appears in 1 contract
Samples: Compliance Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXXReport of Examination dated as of March 31, 2009, in any subsequent Report of Examination, by the loan review conducted as of June 30, 2009 or any subsequent internal or external loan review, or in any list provided to management by the National Bank Examiners during any subsequent examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized quarterly submission and review of Problem Asset Reports (CARs), to be submitted monthly to the Board, for “PARs” or “PAR”) of all criticized credit relationships or Other Real Estate (“ORE”) totaling five hundred thousand dollars ($200,000 500,000) or abovemore. The revised CARs PARs shall contain, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repaymentrepayment and an analysis of their adequacy;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation, as directed by Article VI of this Agreement;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, be repaid from operations;
(d) an assessment of the timely analysis of tax returns, financial statements, news reports, borrower’s global cash flow, contingent liabilities, and other indicators of possible problems;
(e) an assessment of any guarantor’s global cash flow;
(f) the current grade and proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fg) trigger dates for positive borrower actions or for loan officers to reassess the strategy and strategy, enact collection plans; and, and make appropriate downgrades or place on nonaccrual;
(gh) a determination of whether the loan is impaired and the amount of the impairment, consistent with FASB Statement of Financial Accounting Standards No. 114, Accounting by Creditors for Impairment of a Loan;
(i) for criticized relationships of five hundred thousand dollars ($200,000 500,000) or above that were made for the purpose of constructing or developing CRE, the reports PARs shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ixvi) any other significant information relating to the project; and
(j) an evaluation of the progress made in the last quarter.
(3) The CARs required by Paragraph Within thirty (230) days of the end of each calendar quarter, the Bank shall assess the overall progress made pursuant to this article shall cover Article, and determine appropriateness of the entire credit relationshipplans, rather than the current process of generating separate reports for individual loanspolicies and procedures adopted pursuant to this Article.
(4) A copy of each PAR prepared along with any Board comments regarding the effectiveness of the effort to eliminate the weaknesses in each credit or to dispose of the ORE, and the assessment made pursuant to Paragraph (3) of this Article, shall be submitted to the Assistant Deputy Comptroller within thirty (30) days after the end of each calendar quarter.
(5) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXXReport of Examination dated as of March 31, 2009, in any subsequent Report of Examination, in the loan review conducted as of June 30, 2009 or any subsequent internal or external loan review, or in any subsequent list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions of credit equal or exceed five hundred thousand dollars ($200,000500,000), unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromisedcompromised by the extension of credit.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
PROBLEM LOAN MANAGEMENT. (1) Effective as of the date of this Agreement, the Board shall take immediate and continuing action to protect its interest in those assets criticized in the XXXROE, in any subsequent Report of Examination, by internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination.
(2) The Board’s compliance with Paragraph (1) of this Article shall include the development of enhancements to procedures for the Bank’s Criticized Asset Reports (CARs), to be submitted monthly to the Board, submission and review of problem asset reports for all criticized credit relationships totaling $200,000 100,000 or above. The revised CARs shall contain, that require, at a minimum, analysis and documentation of the following:
(a) a complete credit history, to include, at a minimum:
(i) loan origination date;
(ii) loan purpose;
(iii) grade history, including the reason for any grade change;
(iv) any material changes since the previous CAR was filed;
(b) an identification of the expected sources of repayment;
(cb) the appraised value of supporting collateral and the position of the Bank’s lien on such collateral where applicable as well as other necessary documentation to support the collateral valuation;
(dc) an analysis of current and satisfactory credit information, including cash flow analysis where loans are to include, at a minimum, the timely analysis of tax returns, financial statements, news reports, global cash flow, contingent liabilities, and other indicators of possible problemsbe repaid from operations;
(ed) the proposed action to eliminate the basis of criticism and the time frame for its accomplishment;
(fe) trigger dates for positive borrower actions or for loan officers to reassess the strategy and enact collection plans; and
(gf) for criticized relationships of $200,000 100,000 or above that were made for the purpose of constructing or developing CRE, the reports shall also include:
(i) the initial scheduled maturity date of the loan, number of extensions and/or renewals, and current maturity date;
(ii) project development status;
(iii) a comparison of development costs to the budgeted amount;
(iv) a comparison of sales activity to the original sales projections;
(v) current market conditions and activity;
(vi) amount of initial interest reserve and the amount of any subsequent additions to the reserve;
(vii) an assessment of the borrower’s global cash flow;
(viii) an assessment of the guarantor’s ability to support the project; and
(ix) any other significant information relating to the project.
(3) The CARs required by Paragraph (2) of this article shall cover the entire credit relationship, rather than the current process of generating separate reports for individual loans.
(4) Effective as of the date of this Agreement, the Bank may not extend credit, directly or indirectly, including renewals, extensions or capitalization of accrued interest, to a borrower whose loans or other extensions of credit are criticized in the XXX, in any subsequent Report of Examination, in any internal or external loan review, or in any list provided to management by the National Bank Examiners during any examination and whose aggregate loans or other extensions exceed $200,000100,000, unless each of the following conditions is met:
(a) the Board or a designated committee thereof finds that the extension of additional credit is necessary to promote the best interests of the Bank and that prior to renewing, extending or capitalizing any additional credit, a majority of the Board or a designated committee thereof approves the credit extension and documents in writing, the reasons that such extension is necessary to promote the best interests of the Bank; and
(b) the Board’s formal plan to collect or strengthen the criticized asset will not be compromised.
(5) The Board shall conduct a review, on at least a monthly basis, to determine the status of all criticized assets and Bank management’s adherence to the requirements of this Article.
Appears in 1 contract
Samples: Banking Agreement
