Welcome to our the FBLG Banking Library. Below are articles from our industry experts that highlight the expertise in each of our service areas.

Topic: Loan Review and Asset Management

Renewing Commercial Real Estate Loans

There are four primary factors that need to be considered when renewing the credit on a commercial real estate loan that has not met the original objectives: Income levels and sources, Principal pay-downs or curtailments, available liquidity and amortization.

Potential Simplifications to Capital Rules

OCC Bulletin 2017-47 would include changes to high-volatility commercial real estate, mortgage servicing assets, temporary difference deferred tax assets, holdings of regulatory capital instruments issued by other financial institutions, and minority interest limitations.

Rise in Credit Card Delinquencies

The rise in credit card delinquencies are due to loosening credit standards as unemployment rates continue to trend downward. U.S. household debt levels are near record highs, after having surpassed their pre-crisis peak earlier this year.

OCC Releases Guidance for "Higher-Loan-To-Value" Lending Programs in Targeted Communities

Office of the Comptroller of the Currency issued guidance to banks under its jurisdiction for the establishment of lending programs offering loans with loan to value ratios (LTV) above 100 percent, referred to as “higher-loan-to-value” loans.

FDIC Proposes Changes to Appraisals for Commercial Real Estate Transactions

The Real Estate Appraisals proposal would increase the threshold for commercial real estate transactions from $250,000 to $400,000.

Annual Commercial Loan Review

Annual commercial loan reviews have become more important in recent years. Financial regulators expect financial institutions to have the appropriate processes and staff to conduct the review. Many factors should be considered for a comprehensive annual review system.

Stress Testing for Commercial Real Estate Loans

Stress testing for real estate loans is a risk management tool designed to analyze current and emerging risks and vulnerabilities by assessing the impact of changing economic conditions on a borrower’s performance to determine future loss rates.

Cash Flow Analysis

When underwriting a loan, the lender has to factor in the cash flow analysis. In the current credit environment, cash flow is the most important factor in determining credit worthiness, as it is ultimately the main source of repayment.

Properly Analyzing Schedule E Business Cash Flow

A common inaccuracy identified in bank-prepared financial spreads is the Federal Income Tax Schedule E. Often Corporations and Partnerships use flow-through income numbers as cash flow and do not properly calculated actual cash flow.