CEIS Review Inc.

Today, The Federal Reserve released their September 2020 supplementary Senior Loan Officer Opinion Survey on Bank Lending Practices (SLOOS) to understand the experiences of domestically chartered banks with the Main Street Lending Program (MSLP). To read in more detail: https://bit.ly/348J2qh

The second round of Loan Accommodations Regulatory Guidance The Federal Financial Institutions Examination Council (FFIEC) issued a joint statement with further guidance regarding COVID-19 loan modifications. The guidance is applicable to both commercial and consumer loans. The guidance is intended to be tailored to financial institution’s size, overall complexity, as well as risk profile regulations. https://bit.ly/3ihfixr ... #covid #compliance #riskmanagement #finance

Interesting moves at the larger Banks, and if history is an indicator, what starts with the larger Institutions always trickles down to the Community Bank level, but only time will tell.

The Federal Reserve System has just released their July 2020 Senior Loan Officer Opinion Survey on Bank Lending Practices report. Here is a short summary on the demand for bank loans and why lending standards are tightening in 2020; https://bit.ly/31jYYol

COVID-19 Pandemic Credit Concerns. SP Global predicts that by the end of 2020 it is estimated that U.S. community banks could face a 50% decrease in earnings due to spikes in credit costs. For more Information: https://bit.ly/30KeJ7y

The Office of the Comptroller of the Currency (OCC) proposed a regulation that would determine when a national bank or Federal savings association makes a loan and is the true lender in the context of a partnership between a bank and a third party. For more information on OCC’s proposal: https://bit.ly/3jFzj1M

Unchartered Waters Adjusting During the Pandemic Join CEIS Review and the New Jersey Bankers Association to discuss the financial impact of the COVID-19 Pandemic across varying lending segments, the expected severity among industries, suggestions for lenders as well as portfolio managers on staying ahead of any potential negative downturns within their respective portfolios. To sign up for this webinar: https://bit.ly/3gVgdCz

On Monday June 15th the Federal Reserve announced that it is resuming examinations for Banks of all sizes. With Examinations back on the calendar for Community Banks, now is the time to have a thorough review of your loan portfolio and identify any segment areas or specific borrowers that may require further attention. CEIS’ reviews are directed and led by experienced lenders and portfolio managers covering a multitude of industries and loan products & structures, this collective knowledge is to the benefit of our clients when preparing for an examination by a third party. Contact CEIS to schedule a review or discuss in detail. https://bit.ly/3e9Eq72

Regulatory agencies issued the final Interagency Guidance on Credit Review Systems which discusses sound management of an institution’s credit risk; a system of independent, ongoing credit review; and appropriate communication regarding the performance of the institution’s loan portfolio to its management and board of directors. https://bit.ly/3dRxgEi

When COVID-19 began, institutions were suddenly faced with addressing the issue of reserving for this explosive pandemic. As state & federal governments enforced closures across the country the entire US economy became threatened with a severe & prolonged recession. Thus, the financial industry is entering a virus driven recession with its unique challenges. For most institutions going into this crisis, earnings were decent, they were adequately capitalized, and an adequate/elevated reserve was in place courtesy of the QF’s. Current discussions we are engaged in with clients during ALLL model validations and in the general course of business are centered on the reserve and this virus driven financial crisis. https://bit.ly/2MoAcfs

Four of the US Banking regulators (OCC, FRB, FDIC and NCUA) issued the final policy statement for the financial institution adoption of CECL, the FASB (ASU 2016-13) change from an incurred loss (IL) reserving methodology to an expected loss (EL) methodology. Full Article available: https://bit.ly/2X4T0Xx

We would like to share with you some insights and reflection on how credit professionals within US lending institutions can prepare to defend their portfolios against the forthcoming turmoil from the COVID-19 Pandemic. https://bit.ly/3fFd9L3