LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within sixty (60) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) procedures to ensure conformance with loan approval requirements;
(d) a system to track and analyze exceptions;
(e) procedures to ensure conformance with Call Report instructions;
(f) procedures to ensure the accuracy of internal management information systems;
(g) a performance appraisal process, including performance appraisals, job descriptions, and incentive programs for loan officers, which adequately consider their performance relative to policy compliance, documentation standards, accuracy in credit grading, and other loan administration matters; and
(h) procedures to track and analyze concentrations of credit, significant economic factors, and general conditions and their impact on the credit quality of the Bank’s loan and lease portfolios. Upon completion, a copy of the program shall be forwarded to the ADC.
(2) Within sixty (60 ) 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 and collateral documentation; and
(f) concentrations of credit.
(3) Beginning August 31, 2006, on a monthly basis management will provide the Board with written reports including, at a minimum, the following information:
(a) the identification, type, rating, and amount of problem 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 vio...
LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within ninety (90) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) a process for annual financial and risk reviews by account officers of commercial and commercial real estate loans over $100,000;
(d) a process for financial and risk reviews by account officers of commercial and commercial real estate loans over $100,000 at least annually or more frequently if necessary;
(e) a process for quarterly financial and risk reviews by account officers of commercial and commercial real estate loans over $100,000 that are rated Special Mention, Substandard or Doubtful;
(f) a process for maintaining current and satisfactory credit information on all commercial loans over $100,000;
(g) procedures to ensure conformance with loan approval requirements and loan covenants;
(h) a specific action plan to correct any violations of law cited in the Report of Examination;
(i) procedures to acquire appraisals on real estate collateral in accordance with regulation;
(j) procedures for reviewing real estate appraisals to ensure compliance with relevant regulation and, that appropriate expertise is used for such reviews. Special emphasis shall be placed on commercial real estate appraisals;
(k) procedures to ensure conformance with Call Report instructions regarding requirements for placing loans on nonaccrual;
(l) a performance appraisal process, including performance appraisals, job descriptions, and incentive programs for loan officers, which adequately consider their performance relative to policy compliance, documentation standards, accuracy in credit grading, and other loan administration matters;
(m) early problem loan identification to assure the timely identification and rating of loans and leases based on lending officer submissions; and
(n) compliance with the Bank's lending policies and laws, rules, and regulations pertaining to the Bank's lending function.
(2) Upon completion, a copy of the program shall be forwarded to the Assistant Deputy Comptroller, who shall have the right to determine the sufficiency of the program.
(3) The Board shall ensure tha...
LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within sixty (60) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(b) a system to track and analyze exceptions;
(c) procedures to ensure continued conformance with Call Report instructions;
(d) procedures to ensure the continued accuracy of internal management information systems;
(e) a performance appraisal process, including performance appraisals, job descriptions, and incentive programs for loan officers, which adequately consider their performance relative to policy compliance, documentation standards, accuracy in credit grading, and other loan administration matters;
(f) procedures to track and analyze concentrations of credit, significant economic factors, and general conditions and their impact on the credit quality of the Bank's loan and lease portfolios;
(g) a process to ensure market analysis is performed for various property types and geographic markets represented in the banks portfolio no less than quarterly;
(h) a comprehensive loan review process that quantifies the overall level of credit risk and assesses the quality of credit risk management; and
(i) procedures to ensure the re-appraisal of property that defines the criteria for when a new or adjusted appraisal is required based upon changes in market conditions or original project plans.
(2) Upon completion, a copy of the program shall be forwarded to the Assistant Deputy Comptroller.
(3) Within sixty (60) 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 and collateral documentation; and
(f) concentrations of credit.
(4) Begin...
LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within ninety (90) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) procedures to ensure conformance with loan approval requirements;
(d) a system to track and analyze exceptions;
(e) procedures to ensure conformance with Call Report instructions;
(f) procedures to ensure the accuracy of internal management information systems;
(g) a performance appraisal process, including performance appraisals, job descriptions, and incentive programs for loan officers, which adequately consider their performance relative to policy compliance, documentation standards, accuracy in credit grading, and other loan administration matters;
(h) procedures to track and analyze concentrations of credit, significant economic factors, and general conditions and their impact on the credit quality of the Bank’s loan and lease portfolios.
(i) early problem loan identification procedures to assure the timely identification and rating of loans and leases based on lending officer submissions;
(j) procedures to monitor previously charged-off assets and their recovery potential; and
(k) compliance monitoring system to determine compliance with the Bank's lending policies and laws, rules, and regulations pertaining to the Bank's lending function.
(2) Upon completion, a copy of the program shall be forwarded to the Assistant Deputy Comptroller.
(3) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program and systems developed pursuant to this Article.
LOAN PORTFOLIO MANAGEMENT. (1) Within sixty (60) days, Board shall establish credit risk management practices that ensure effective credit administration, portfolio management and monitoring, and risk mitigation. In doing so, the Board shall adopt and the Association (subject to Board review and ongoing monitoring) shall implement and thereafter ensure adherence to a written credit policy to improve the Association's loan portfolio management. The credit policy shall include (but not be limited to):
(a) revision and/or development of the Association’s procedures to ensure accuracy of risk ratings and proper and timely problem loan identification, including non-accrual loans;
(b) procedures that require ongoing monitoring of borrower ability to repay the loan through receipt and documented review of current borrower, principal and guarantor financial information;
(c) procedures and controls to periodically verify the existence and lien position of collateral;
(d) procedures that ensure the utilization of interest reserves is consistent with established controls and clearly defined parameters for projected costs.
(e) credit risk rating definitions consistent with applicable regulatory guidance;
(f) procedures for early problem loan identification, to ensure that credits are accurately risk rated at least monthly;
(g) written reports, regularly submitted to the Board, identifying the aggregate loans and leases not in conformance with the Association’s lending and leasing policies, and exceptions to the Association’s lending and leasing policies;
(h) a system to effectively monitor previously charged-off assets and their recovery potential; and
(i) a requirement to identify, track and report real estate loans that exceed the supervisory loan-to-value limits.
(2) The Board shall ensure that Association personnel performing credit analyses are adequately trained in cash flow analysis, particularly analysis using information from tax returns, and that processes are in place to ensure that additional training is provided as needed.
(3) The Board shall ensure that management adequately staffs the Credit Department with personnel who possess the appropriate expertise relative to the Association’s risk profile.
(4) Within sixty (60) days the Board shall adopt, implement and ensure Association adherence to a written portfolio stress testing policy that considers changes in interest rates and appropriate economic factors.
(5) A written report of the stress test results shall be provided to the B...
LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within thirty (30) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) procedures to ensure conformance with loan approval requirements;
(d) a system to track and analyze exceptions;
(e) procedures to ensure interim construction lending standards are adhered to;
(f) procedures to ensure asset-based lending standards are enforced through the maintenance of current accounts receivable aging reports, inventory listings, borrowing base agreements, and inspections;
(g) procedures to ensure conformance with Call Report instructions;
(h) procedures to ensure the accuracy of internal management information systems; and
(i) procedures to track and analyze concentrations of credit, significant economic factors, and general conditions and their impact on the credit quality of the Bank’s loan and lease portfolios.
(2) Upon completion, a copy of the program shall be submitted to the ADC for review and prior written determination of no supervisory objection. Upon receiving a determination of no supervisory objection from the ADC, the Bank shall implement and adhere to the program.
(3) 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 and collateral documentation;
(f) compliance with OCC Bulletin 2000-20 Uniform Retail Credit Classifications and Account Management Policy dated June 20, 2000; and,
(g) concentrations of credit.
(4) Beginning September 1, 2006, and on a monthly basis thereafter, management will provide ...
LOAN PORTFOLIO MANAGEMENT. (1) Within sixty (60) days, Board shall review ,and revise as necessary, the Bank’s written credit policy, which shall include (but is not limited to):
(a) a description of the types of credit information required from borrowers and guarantors, including (but not limited to) annual audited statements, interim financial statements, personal financial statements, and tax returns with supporting schedules;
(b) procedures that require any extension of credit (new, maturity extension, or renewal) is made only after obtaining and validating current credit information about the borrower and any guarantor sufficient to fully assess and analyze the borrower’s and guarantor’s cash flow, debt service requirements, contingent liabilities, and global liquidity condition, and only after the credit officer prepares a documented credit analysis;
(c) procedures that require any extension of credit (new, maturity extension, or renewal) is made only after obtaining and documenting the current valuation of any supporting collateral, and that reasonable limits are established on credit advances against collateral, based on a consideration of (but not limited to) a realistic assessment of the value of collateral, the ratio of loan to value, and overall debt service requirements;
(d) procedures and controls to periodically verify the existence and lien position of collateral;
(e) a requirement that borrowers and/or guarantors maintain any collateral margins established in the credit approval process;
(f) procedures that prohibit the capitalization of accrued interest on any loan renewal or extension;
(g) procedures that prohibit, on any loan renewal or extension, the establishment of an interest reserve using the proceeds of any Bank loan to the same borrower or guarantor;
(h) procedures to ensure that all exceptions to the credit policy shall be clearly documented on the loan offering sheet, problem loan report, and other MIS; and approved by the Board or a committee thereof before the loan is funded or renewed;
(i) credit risk rating definitions consistent with applicable regulatory guidance;
(j) procedures for early problem loan identification by lending officers, to ensure that credits are accurately risk rated at least monthly;
(k) prudent lending and approval limits for lending officers that are commensurate with their experience and qualifications, and that prohibit combining individual lending officers’ lending authority to increase limits;
(2) Upon completion, a copy of...
LOAN PORTFOLIO MANAGEMENT. (1) Within sixty (60) days, the Board shall develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) procedures to ensure conformance with loan approval requirements;
(d) a system to track and analyze exceptions; and
(e) procedures to ensure the accuracy of internal management information systems.
(2) Upon completion, a copy of the program shall be forwarded to the Assistant Deputy Comptroller. Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement, and require the Bank to adhere to, the program.
(3) Beginning August 31, 2005, management will provide the Board with written reports on a monthly basis including, at a minimum, the following information:
(a) credit and collateral documentation exceptions;
(b) the identification and status of credit related violations of law, rule or regulation;
(c) the identity of the loan officer who originated each loan reported in accordance with subparagraphs (a) through (d) of this Article and Paragraph; and
(d) the identification of loans and leases not in conformance with the Bank's lending and leasing policies, and exceptions to the Bank's lending and leasing policies.
(4) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program and systems developed pursuant to this Article.
LOAN PORTFOLIO MANAGEMENT. The Board shall, within thirty (30) days, develop, implement, and thereafter ensure Bank adherence to, a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
LOAN PORTFOLIO MANAGEMENT. (1) The Board shall, within sixty (60) days, develop, implement, and thereafter ensure Bank adherence to a written program to improve the Bank's loan portfolio management. The program shall include, but not be limited to:
(a) procedures to ensure satisfactory and perfected collateral documentation;
(b) procedures to ensure that extensions of credit are granted, by renewal or otherwise, to any borrower only after obtaining and analyzing current and satisfactory credit information;
(c) procedures to ensure conformance with loan approval requirements;
(d) a system to track and analyze exceptions;
(e) procedures to ensure conformance with Call Report instructions;
(f) a performance appraisal process, including performance appraisals, job descriptions, and incentive programs for loan officers, which adequately consider their performance relative to policy compliance, documentation standards, accuracy in credit grading, and other loan administration matters.
(2) Upon completion, a copy of the program shall be forwarded to the ADC.
(3) Effective immediately, the Bank may grant, extend, renew, alter or restructure any loan or other extension of credit only after:
(a) documenting the specific reason or purpose for the extension of credit;
(b) identifying the expected source of repayment in writing;
(c) structuring the repayment terms to coincide with the expected source of repayment;
(d) obtaining and analyzing current and satisfactory credit information, including cash flow analysis, where loans are to be repaid from operations;
(i) Failure to obtain the information in (2)(d) shall require a majority of the full Board (or a delegated committee thereof) to certify in writing the specific reasons why obtaining and analyzing the information in (2)(d) would be detrimental to the best interests of the Bank.
(ii) A copy of the Board certification shall be maintained in the credit file of the affected borrower(s). The certification will be reviewed by this Office in subsequent examinations of the Bank; and
(e) documenting, with adequate supporting material, the value of collateral and properly perfecting the Bank's lien on it where applicable.
(4) Within sixty (60) 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;
(b) previously charged-off assets and their recovery potential;
(c) comp...
