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#1117723 - 01/27/09 09:57 PM pitfalls to loan exceptions
Trees Offline
Power Poster
Joined: Apr 2005
Posts: 4,013
if someone were to ask you why its not a good thing to have loan programs/policies and then make exceptions to those polices your answer would be.....?

I feel that a bank would be open to possible discrimination, probably unintentional.

Anyone have any other arguments against making exceptions, or have comments about this topic, please feel free.

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General Discussion
#1117763 - 01/28/09 01:16 AM Re: pitfalls to loan exceptions Trees
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 80,325
Galveston, TX
Policy are designed to ensure that the bank operates in a safe and sound manner. The board approves the policies and a high amount of exceptions without following the documentation standards for acceptable compensating factors (that should also be included by the Board) indicate disregard for the board approved policies.
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#1117811 - 01/28/09 06:22 AM Re: pitfalls to loan exceptions rlcarey
Dazed and Confused Offline
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Dazed and Confused
Joined: Feb 2006
Posts: 250
Big XII South
A high level of exceptions could possibly indicate that the policy is too restrictive (i.e. committee approval required for small-dollar loans, etc.). But generally speaking ... I agree wtih RLC.

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#1118015 - 01/28/09 04:25 PM Re: pitfalls to loan exceptions Dazed and Confused
Mint Julep Offline
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Mint Julep
Joined: Oct 2007
Posts: 1,152
Tennessee
Examiners will criticize an excessive number of exceptions to loan policy. They will also criticize if you are not tracking those exceptions.
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#1118088 - 01/28/09 05:10 PM Re: pitfalls to loan exceptions Mint Julep
Trees Offline
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Joined: Apr 2005
Posts: 4,013
We are tracking them and, so far, there aren't too many...

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