Occs loan portfolio management booklet of the comptrollers handbook states that the principal approach to control loan quality is a solid loan approval process. The revised booklet presents the regulatory capital framework and discusses the regulatory capital rules that define regulatory capital and establish minimum capital standards. Ecs matches lenders and borrowers in an exchangelike platform using automated liquidity and price discovery mechanisms. Riskbased expanded examination procedures are provided to guide abl examinations. One of a series of specialized lending booklets of the comptrollers handbook, leveraged lending supplements the general guidance in the loan portfolio management and commercial lending booklets. The following sections are extracts from the office of examinations program for examining an. Apr 17, 2017 last week the office of the comptroller of the currency published a retail lending booklet, a new addition to the safety and soundness asset quality category of the comptrollers handbook, which discusses the risks associated with retail lending and provides a framework for occ examiners to evaluate retail credit risk management activities. Inez markovich gives readers an overview on the occs recently issued handbook on assetbased lending. This booklet provides an overview of financial derivatives, addresses associated risks, and discusses risk management practices. The longterm goal of the infobase is to provide justintime training for new regulations and for other topics of specific concern to. Summary the office of the comptroller of the currency occ issued today the corporate and risk governance booklet of the comptrollers handbook. Comptrollers handbook april 1998 comptroller of the currency administrator of national banks on. This booklet describes the elements of an effective internal process for rating credit risk.
Oil and gas production lending, comptrollers handbook lexis. In july 1993, occ introduced a stock loan program formerly hedge which allowed clearing members to use borrowed and loaned securities to reduce occ margin requirements by reflecting the real risks of their intermarket hedged positions. The booklet is one of several specialized lending booklets and supplements guidance contained in the loan portfolio management booklet, as well. The office of the comptroller of the currency occ issued today the retail lending booklet of the comptrollers handbook.
We direct this list of sound practices to those senior executives responsible for their firms risk management and financial integrity and to those who are originators, underwriters, and managers of credit exposures worldwide. Occ 20031 occ bulletin comptroller of the currency administrator of national banks subject. The respa booklet provides guidance and procedures to examiners in connection with changes made by cfpb to regulation x 12 cfr 1024, which implements the respa. Loan portfolio management community development financial. Allowance for loan and lease losses may 1998 addresses requirements for evaluating, reporting, and accounting considerations that affect allowances for loan and lease losses. Al 973 has been replaced by the comptrollers handbook loan portfolio management booklet. Occ issues retail lending handbook booklet payment law. The risk rating profile of the loan portfolio, including trend of multiple. Audit report united states department of the treasury. Occ issued the capital and dividends booklet of the comptrollers handbook. Loan portfolio management ii comptrollers handbook. Occ issues asset based lending booklet cla cliftonlarsonallen. The occ recognizes that banking is a business of managing risks while maximizing.
This booklet applies to the occs supervision of national banks and federal savings associations. Washington wrap up occ issues retail lending booklet rma. Charles smithson compares the results of two surveys done in the past two years to discover how portfolio management has evolved. Status of certain investment funds and their portfolio investments for purposes. The information technology examination handbook infobase concept was developed by the task force on examiner education to provide field examiners in financial institution regulatory agencies with a quick source of introductory training and basic information. Occ s market loan program is a program whereby occ processes and maintains stock loan positions that have originated through a loan market. Bank supervision process and loan portfolio management booklets of the. The proposed guidance discusses sound management of credit risk, a.
Asset securitization november 1997 covers using the securities markets to fund portions of a loan portfolio, to allocate capital more efficiently and better manage risks. Mar 27, 2014 the occs assetbased lending booklet provides guidance to examiners and bankers regarding assetbased lending abl activities and risks, prudent credit risk management and underwriting expectations, credit administration, and credit risk rating. Outlines nine elements that underpin a banks loan portfolio management process and provides examiner guidance. It describes the types of risks that may affect the whole loan portfolio, explains how to. The basic elements of a wellmanaged retail credit portfolio include.
This booklet discusses risks associated with lending and addresses sound loan portfolio management. Jul 05, 2017 occ issues retail lending handbook booklet. Loan portfolio management comptrollers handbook, april 1998 outlines nine elements that underpin a banks loan portfolio management process and provides examiner guidance. The occ expects national banks to have credit risk management systems that produce accurate and timely risk ratings. Managers presents sound practices in credit portfolio management. The following it topics are available via this infobase.
On january 24, 2012, the occ issued a notice of proposed. Large bank supervision bookletcomptrollers handbook for safety. The 78page booklet is one of several specialized lending booklets and supplements guidance contained in the loan portfolio management booklet, as well as the large bank supervision and community bank. She notes that financial institutions pursuing abl transactions need to keep abreast of the current examination principles and, if necessary, strengthen internal procedures designed to improve the risk management of their abl portfolios. It also includes direction on examining creditrelated management information systems and loan portfolio stress testing, which are key components of the portfolio analysis process. The consumer compliance risk management principles in this booklet reflect the occs risk based supervision approach and are consistent with the occs assessment of banks risk management systems and the interagency consumer compliance rating definition. The occs assetbased lending booklet provides guidance to examiners and bankers regarding asset.
This article provides an overview of this line of business and of the relevant highlights of this new abl booklet. Likewise, the occ considers accurate classification of credit among its top supervisory priorities. The booklet is one of several specialized lending booklets and supplements guidance contained in the loan portfolio management. Lpm is the process by which risks that are inherent in the credit process are managed and controlled. This new booklet, part of the safety and soundness category of the comptrollers handbook, discusses the risks associated with retail lending and provides a framework for evaluating retail credit risk management activities. Lpm publication and the occ handbook lpm booklet for additional background. Loan portfolio management office of the comptroller of.
Overview lending is the principal business activity for most commercial banks. Bank management and examiners should use this guidance in conjunction with the concentrations of credit booklet in the occs comptrollers handbook series, occ bulletin 201216, guidance for evaluating capital planning and adequacy, and the interagency final guidance on concentrations in commercial real estate lending, sound. The office of the comptroller of the currency s occ comptrollers handbook booklet, student lending, is prepared for use by occ examiners in connection with their examination and supervision of national banks and federal savings associations collectively, banks. Abl is a specialized loan product that provides fully collateralized credit facilities to borrowers that may have high. Loan portfolio management, comptrollers handbook occ. This booklet applies to the occ s supervision of national banks and federal savings associations. Overview portfolio planning and analysis are key components of an institutions overall business planning process and are essential for effective loan portfolio management lpm. The consumer compliance risk management principles in this booklet reflect the occ s risk based supervision approach and are consistent with the occ s assessment of banks risk management systems and the interagency consumer compliance rating definition. Account management, risk management, and loss allowance practices the agencies expect institutions to fully test, analyze, and support their account management practices, including credit line management and pricing criteria, for prudence prior to broad implementation of those practices. Criteria examiners should consider when evaluating retail credit originations, account management, collections, and portfolio management activities and processes. Wholesale payment systems federal financial institutions. The booklet states that contamination may decrease the collaterals value or render the collateral worthless. Prudent risk selection is vital to maintaining favorable loan quality. The booklet is one of several specialized lending booklets and augments guidance contained in the loan portfolio management, large bank supervision, and community bank supervision booklets of the comptrollers handbook.
This new booklet updates, consolidates, and rescinds the following comptrollers handbook booklets. This module provides guidance on examining portfolio planning and analysis processes. Environmental risk has been elevated to a more prominent position in the 20 crel booklet. Merchant processing comptrollers handbook, august 2014 focuses on credit card payment processing, which is a separate line of business from credit card issuing. Occ issues assetbased lending booklet by anna desimone march 27, 2014 the office of the comptroller of the currency occ issued its assetbased lending booklet, which is new to the comptrollers handbook. Occ acts as central counter party ccp to these matched loans and provides clearing and settlement services to the market and occ clearing members. Occ provides risk management guidance for bankers engaged. References to national banks in this booklet also generally apply to federal branches and agencies of foreign banking organizations. Duties and responsibilities of directors, issued in march 1990 and examination procedures issued in january 1998. The occ expects risk management for retail lending activities to correspond. As such, it is one of the greatest sources of risk to a banks safety and soundness. This lesson is designed for more senior loan officers or branch managers who are responsible for the lending policies and overall performance of their institution.
Compilation of comptrollers handbook booklets that relate to commercial credit. Occ currently clears securities lending transactions for automated equity finance markets, inc. Offbalance sheet items include letters of credit unfunded loan commitments. Occ issues capital and dividends booklet of the comptroller. The occs booklet outlines a framework for evaluating retail credit risk management activities and discusses the risks associated with retail lending. In 1997, the occs advisory letter 973 encouraged banks to view risk management in terms of the entire loan portfolio. Characteristics of an effective retail credit risk management framework.
More prominent role for environmental risk management in. Commercial real estate lending, comptrollers handbook. When individual credits are underwritten with sound credit principles, the credit quality of the portfolio is much more likely to be sound. Loan portfolio management news and analysis articles.
Each bank is different and may present specific issues. We are also recommending that occ expand its examiner guidance in the. The enclosed booklet, loan portfolio management lpm, is part of the ongoing revision of the comptrollers handbook. Occ provides risk management guidance for bankers engaged in assetbased lending activities. Comptrollers handbook ffiec it examination handbook. The occ expects risk management for retail lending activities to correspond to. Comptrollers handbook loan portfolio management lpm occ. This booklet applies to the occs supervision of national banks. Fca uses the ucs to evaluate the quality of retail loans and loanrelated assets, the direct loan.
More prominent role for environmental risk management in revised occ handbook read more. Loan portfolio management 2 comptrollers handbook effective loan portfolio management begins with oversight of the risk in individual loans. Occ updated the real estate settlement procedures act respa booklet and the foreword booklet of the comptrollers handbook. Since 1976, the occs guidance to banks and examiners on the determination of an adequate level for the allowance for loan and lease losses has been. Occ issues retail lending booklet cla cliftonlarsonallen. In a written response, which is included as appendix 3, occ provided its planned corrective actions which we consider. Retail lending, comptrollers handbook lexis securities mosaic. The office of the comptroller of the currencys occ comptrollers handbook is prepared for use by occ examiners in connection with their examination and supervision of national banks, federal savings associations, and federal branches and federal agencies of foreign banking organizations collectively, banks. This booklet applies to the occ s supervision of national banks.
At the loan officer level take allowed assets and ensures profitability. The office of the comptroller of the currencys occ comptrollers handbook booklet, assetbased lending, provides guidance for bank examiners and bankers on assetbased lending abl activities. Rescinded al 973 has been replaced by the comptrollers. Therefore, the historical emphasis on controlling the quality of individual loan approvals and managing the performance of loans. Leveraged lending office of the comptroller of the currency. The crel booklet identifies environmental liability as one of five credit risks that effect ability of the borrower to repay its loan. On april 12, 2017, the office of the comptroller of the currency the occ issued a retail lending booklet booklet as part of the comptrollers handbook. Loan portfolio management office of the comptroller of the. Loan portfolio management 1 comptrollers handbook loan portfolio. The occ, the board, the fdic, and the ncua collectively, the.
Anna desimone march 27, 2014 the office of the comptroller of the currency occ issued its assetbased lending booklet, which is new to the comptrollers handbook. Audit, business continuity planning, development and acquisition, ebanking, fedline, information security, management, operations, outsourcing technology services, retail payment systems, supervision of technology service providers, wholesale payment systems. The occ expects risk management for retail lending activities to. Occ has defined eight categories of risk for bank supervision purposes. References to national banks in this booklet also generally apply to federal branches. Oil and gas production lending lexis securities mosaic. Occ issues retail lending handbook booklet lexology. Interagency counterparty credit risk management guidance. The loan portfolio is typically the largest asset and the predominate source of revenue. Last week the office of the comptroller of the currency published a retail lending booklet, a new addition to the safety and soundness asset quality category of the comptrollers handbook, which discusses the risks associated with retail lending and provides a framework for occ examiners to evaluate retail credit risk management activities.
29 481 1421 633 817 395 931 668 20 1597 298 231 1059 344 1530 1195 851 907 1381 534 1232 1144 97 1167 1658 289 850 119 744 125 1202 992 990 1491 584 1442 834 859 729 905 261 859 985