I do not believe this question has ever come up before and I would appreciate any opinions on this matter.
Once credit has been charged off, is the credit subject to any regulatory requirements if the bank enters into a written agreement with the borrower? Would it mater if the credit was on the balance sheet or off the balance sheet? Or does this fall solely into the legal arena?

What is the nature of the written agreement?

A legally prepared workout agreement.

So you have written the loan of for accounting/safety and soundness purposes, but are still attempting to collect. The note is still valid and you haven't foreclosed or taken the collateral? Then you have a valid loan modification (no new note) no disclosures are required. See state laws for possible limitations.

The important question is not if the loan is on the books or off. It is do you still have a valid debt that you can modify. It doesn't sound like you have issues with the regs from what you have stated, but I would defer to one of the guru's out there.

If consumer, it would fall outside of Reg. Z as a workout loan. However, all dealings with the customer would still fall under the general provisions of Reg. B.

Thank you West Coast Comp and rlcarey! This question is coming from our Corporate Banking Group business unit; I have requested more information, first of all as to why this question came up, because I know this is not the first time this has happened and secondly I need to know if this is to a Corporation and/or an individual.
I guess my first thought was that once a loan is charged off, corporate loan or consumer loan, that it fell outside of the regulatory world.
I will let you know what I find out.
Again, thank you for your opinions!

OK, the compliance contact in the bank's Corporate Banking Group business unit is the one who sent me the question; I spoke with her this morning and she was inquiring only to be sure she wasn't missing anything on these special asset loans ie non-accrual, charged-off, and work-out loans. She said that these customers will call in the future after action was taken on the non-performing loan and want to erase some of their bad debt with the bank; legal prepares a written agreement and it is signed by the borrower.
Any more opinions with this new information?

..

The only thing that I can think of is your 1099C reporting at the time that the written agreement is signed, if it includes forgiven debt.

I'm with RL.