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#1431840 - 08/19/10 09:02 PM ACH & Legal Lending Limit?
Princess of Power Offline
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Princess of Power
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Napa, CA
Must we take into account our legal lending limit when setting a customers ach limits?

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Lending Compliance
#1431936 - 08/20/10 04:46 AM Re: ACH & Legal Lending Limit? Princess of Power
rlcarey Online
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rlcarey
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Galveston, TX
No.
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#1432421 - 08/20/10 08:59 PM Re: ACH & Legal Lending Limit? rlcarey
Princess of Power Offline
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Princess of Power
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Napa, CA
Thank you

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#1449269 - 09/28/10 05:52 PM Re: ACH & Legal Lending Limit? Princess of Power
CPK Offline
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I have a question along the same lines and am looking for support material. Where would I take a look for such supporting material? I have obtained the OCC 2006 risk management guidance and the FFIEC Retail payment systems booket, however both are not really clear and the FFIEC booklet references the legal lending limit as a factor for credit risk. Is there something more clear cut I can refer to?
Last edited by CPK; 09/28/10 05:55 PM. Reason: didn't finish post
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#1449314 - 09/28/10 06:58 PM Re: ACH & Legal Lending Limit? CPK
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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The reasoning hinges on ACH "risk" lines not being loans. They do not meet the definition of a loan.

Some banks, to avoid LLL risk, will count risks like ACH in the LLL numbers so that if the customer leaves you hanging you have room when the risk becomes a loan.

Good underwriting and management of ACH should avoid that issue, but if the bank pushes up against the LLL, it could happen.
Last edited by MS Kaybee; 09/28/10 07:42 PM.
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