Comptrollers handbook ffiec it examination handbook. Occ currently clears securities lending transactions for automated equity finance markets, inc. It also includes direction on examining creditrelated management information systems and loan portfolio stress testing, which are key components of the portfolio analysis process. Interagency counterparty credit risk management guidance.
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. This module provides guidance on examining portfolio planning and analysis processes. 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. This new booklet updates, consolidates, and rescinds the following comptrollers handbook booklets. Offbalance sheet items include letters of credit unfunded loan commitments. Jul 05, 2017 occ issues retail lending handbook booklet. The enclosed booklet, loan portfolio management lpm, is part of the ongoing revision of the comptrollers handbook. At the loan officer level take allowed assets and ensures profitability.
Loan portfolio management 1 comptrollers handbook loan portfolio. Compilation of comptrollers handbook booklets that relate to commercial credit. 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. More prominent role for environmental risk management in. On january 24, 2012, the occ issued a notice of proposed. Washington wrap up occ issues retail lending booklet rma. Occ updated the real estate settlement procedures act respa booklet and the foreword booklet of the comptrollers handbook. Retail lending, comptrollers handbook lexis securities mosaic. More prominent role for environmental risk management in revised occ handbook read more. Charles smithson compares the results of two surveys done in the past two years to discover how portfolio management has evolved. Oil and gas production lending lexis securities mosaic. Loan portfolio management office of the comptroller of. Large bank supervision bookletcomptrollers handbook for safety.
Duties and responsibilities of directors, issued in march 1990 and examination procedures issued in january 1998. We are also recommending that occ expand its examiner guidance in the. Al 973 has been replaced by the comptrollers handbook loan portfolio management booklet. Each bank is different and may present specific issues. Oil and gas production lending, comptrollers handbook lexis.
Abl is a specialized loan product that provides fully collateralized credit facilities to borrowers that may have high. Occ provides risk management guidance for bankers engaged. The following sections are extracts from the office of examinations program for examining an. Characteristics of an effective retail credit risk management framework. This booklet applies to the occs supervision of national banks and federal savings associations. Occ 20031 occ bulletin comptroller of the currency administrator of national banks subject. The occ expects risk management for retail lending activities to. Occ issues asset based lending booklet cla cliftonlarsonallen. 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 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. The proposed guidance discusses sound management of credit risk, a.
Loan portfolio management ii comptrollers handbook. Loan portfolio management 2 comptrollers handbook effective loan portfolio management begins with oversight of the risk in individual loans. The following it topics are available via this infobase. 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. 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. The revised booklet presents the regulatory capital framework and discusses the regulatory capital rules that define regulatory capital and establish minimum capital standards. When individual credits are underwritten with sound credit principles, the credit quality of the portfolio is much more likely to be sound. Comptrollers handbook april 1998 comptroller of the currency administrator of national banks on. 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. 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. Inez markovich gives readers an overview on the occs recently issued handbook on assetbased lending. The occs assetbased lending booklet provides guidance to examiners and bankers regarding asset. 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. Criteria examiners should consider when evaluating retail credit originations, account management, collections, and portfolio management activities and processes.
Summary the office of the comptroller of the currency occ issued today the corporate and risk governance booklet of the comptrollers handbook. The booklet states that contamination may decrease the collaterals value or render the collateral worthless. Concentrations in commercial real estate lending occ 200646, december 2006, guidance federal register, december 12, 2006. 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. 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. Allowance for loan and lease losses may 1998 addresses requirements for evaluating, reporting, and accounting considerations that affect allowances for loan and lease losses. This booklet applies to the occs supervision of national banks. 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. 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. 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. 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 basic elements of a wellmanaged retail credit portfolio include. This article provides an overview of this line of business and of the relevant highlights of this new abl booklet.
The occ expects national banks to have credit risk management systems that produce accurate and timely risk ratings. Occ issues retail lending handbook booklet lexology. Occ issues capital and dividends booklet of the comptroller. Comptrollers handbook 1 student lending introduction background the office of the comptroller of the currencys 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. Rescinded al 973 has been replaced by the comptrollers. Loan portfolio management, comptrollers handbook occ. Loan portfolio management office of the comptroller of the.
It describes the types of risks that may affect the whole loan portfolio, explains how to. The occ expects risk management for retail lending activities to correspond. Merchant processing comptrollers handbook, august 2014 focuses on credit card payment processing, which is a separate line of business from credit card issuing. Occ publishes new retail lending booklet consumer finance. This booklet discusses risks associated with lending and addresses sound loan portfolio management. 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 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.
The longterm goal of the infobase is to provide justintime training for new regulations and for other topics of specific concern to. The occs booklet outlines a framework for evaluating retail credit risk management activities and discusses the risks associated with retail lending. Commercial real estate lending, comptrollers handbook. Occ issues retail lending handbook booklet payment law. In a written response, which is included as appendix 3, occ provided its planned corrective actions which we consider. 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.
Occ issued the capital and dividends booklet of the comptrollers handbook. Wholesale payment systems federal financial institutions. The booklet also includes transaction examples to guide examiners and bankers in the assessment of credit risk. Overview portfolio planning and analysis are key components of an institutions overall business planning process and are essential for effective loan portfolio management lpm. Likewise, the occ considers accurate classification of credit among its top supervisory priorities. 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.
Overview lending is the principal business activity for most commercial banks. Lpm is the process by which risks that are inherent in the credit process are managed and controlled. 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. Occs loan portfolio management booklet of the comptrollers handbook states that the principal approach to control loan quality is a solid loan approval process. 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. Lpm publication and the occ handbook lpm booklet for additional background. This booklet applies to the occ s supervision of national banks and federal savings associations. Occ issues retail lending booklet cla cliftonlarsonallen. The risk rating profile of the loan portfolio, including trend of multiple.
Environmental risk has been elevated to a more prominent position in the 20 crel booklet. Loan portfolio management community development financial. In 1997, the occs advisory letter 973 encouraged banks to view risk management in terms of the entire loan portfolio. 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. 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. Therefore, the historical emphasis on controlling the quality of individual loan approvals and managing the performance of loans. Loan portfolio management news and analysis articles.
Comptrollers handbook loan portfolio management lpm occ. The office of the comptroller of the currency occ issued today the retail lending booklet of the comptrollers handbook. Loan portfolio management comptrollers handbook, april 1998 outlines nine elements that underpin a banks loan portfolio management process and provides examiner guidance. References to national banks in this booklet also generally apply to federal branches and agencies of foreign banking organizations. Managers presents sound practices in credit portfolio management. Audit report united states department of the treasury. 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. As such, it is one of the greatest sources of risk to a banks safety and soundness. Occ has defined eight categories of risk for bank supervision purposes. Fca uses the ucs to evaluate the quality of retail loans and loanrelated assets, the direct loan. This booklet describes the elements of an effective internal process for rating credit risk. Ecs matches lenders and borrowers in an exchangelike platform using automated liquidity and price discovery mechanisms. The crel booklet identifies environmental liability as one of five credit risks that effect ability of the borrower to repay its loan.
The occ, the board, the fdic, and the ncua collectively, the. Status of certain investment funds and their portfolio investments for purposes. Outlines nine elements that underpin a banks loan portfolio management process and provides examiner guidance. The booklet is one of several specialized lending booklets and supplements guidance contained in the loan portfolio management. This booklet provides an overview of financial derivatives, addresses associated risks, and discusses risk management practices. 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. Prudent risk selection is vital to maintaining favorable loan quality. Riskbased expanded examination procedures are provided to guide abl examinations. Occ provides risk management guidance for bankers engaged in assetbased lending activities. This booklet applies to the occ s supervision of national banks. The occ recognizes that banking is a business of managing risks while maximizing. The booklet is one of several specialized lending booklets and supplements guidance contained in the loan portfolio management booklet, as well.
Occ acts as central counter party ccp to these matched loans and provides clearing and settlement services to the market and occ clearing members. 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. The occ expects risk management for retail lending activities to correspond to. 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. References to national banks in this booklet also generally apply to federal branches.
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