I work for a national bank so total capital is used for figuring loans in excess of supervisory loan to value limits. My question is: is the capital figure to be used from the most recent call report filed or is it adjusted every month using the current months financial statements? I have been unable to find this in the regulation. I feel like call report should be used but I can't find anything to prove that to loan department staff.

total capital is used for figuring loans in excess of supervisory loan to value limits.

How? I don't understand this statement. The only thing that happens is that when excess LTV loans are greater than regulatory capital is that you come under additional regulatory scrutiny.

Are you referring to the guidance that the aggregate limit of high LTV loans cannot exceed total capital? I believe this only applies to high LTV loans without any credit enhancement (e.g., mortgage insurance).

We don't adjust our report monthly, only quarterly based upon our final capital number.

I'm sorry I didn't make myself clear. Loans in excess of supervisory limits are reported to our board of directors monthly (I believe the law is at least quarterly). As a national bank, the total of these loans cannot exceed total capital and within that aggregate limit, total loans for all commercial, ag, multifamily or other non 1-4 family should not exceed 30% of total capital. Presently our loan department is adjusting their report monthly based on financial statements; I think the capital amount used should only be changed quarterly based on call report data. Thank you for your response GoBucs.

As a national bank, the total of these loans cannot exceed total capital and within that aggregate limit...

Really, do you mind pointing out the regulatory citation to support that claim??? I think the term is "should not" and not "cannot". Such things are always calculated from the latest call report data. That is the data available to the regulators.

ok, should not. I know what regulators go by. However, I am still new here so I am expected to prove everything in black and white and have not found it. sorry I wasted everyones time.

Please don't think you've wasted time. We all learn together sometimes. We are lucky to have the Guru's and fellow BOLers to help us.

That makes me ask a question too - Does everyone wait for the June call report to be filed before reporting the second quarter's SLTV numbers. I report in mid-July so I use March quarter-end Call Report numbers since June's are not yet availabe. I wondered if I should change my report date to August, after the second call report is filed. Our "buckets" have never been in any danger of reaching the established limits. OCC Examiner's have never commented on this, even though they review my report every year. Any opinions?

At my previous bank, we did the same thing you are doing. Our "buckets" were ok also; but examiners did look at the reports and never commented.

We won't sign-off on our June report until the second quarter capital number is in.