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#2169523 - 03/22/18 12:50 PM Consumer Loans & Other Loan Data
Half Pint Offline
Member
Joined: Sep 2012
Posts: 76
Pennsylvania
At a recent CRA & Risk training session, all banks in attendance mentioned that they did not collect and maintain other loan data or consumer loans categorized as motor vehicle, credit card, home equity, other secured, and other unsecured.

We currently do collect and maintain this information in our compliance software. Other than maintaining the data for consideration in the CRA performance evaluation and/or lending test, what are the benefits to collecting this information? We haven't had any auditor or examiner ask for this information but if it could potentially provide value that we are not aware of ... please do share. We are a large bank.

Thanks

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#2173849 - 04/17/18 05:46 PM Re: Consumer Loans & Other Loan Data Half Pint
Half Pint Offline
Member
Joined: Sep 2012
Posts: 76
Pennsylvania
Anyone willing to share?

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#2174277 - 04/19/18 04:40 PM Re: Consumer Loans & Other Loan Data Half Pint
Doin it Right Offline
Junior Member
Joined: Apr 2017
Posts: 35
What "other loan data" are you referring to?

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#2174391 - 04/20/18 12:26 AM Re: Consumer Loans & Other Loan Data Half Pint
Princess Romeo Offline

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Princess Romeo
Joined: Jun 2001
Posts: 8,272
Where the heart is
“Other Secured Lines/Loans for Purposes of Small Business” which is a CRA Type 3.

These are business purpose loans that are not classified as "Small Business Loans" on the Call Report because of the type of collateral or purpose. For instance, you make a loan to a small business owner and take a junior lien on the owner's home as your main collateral. Because of the residential collateral, it is not reported on the Call Report as a Small Business Loan, so you technically cannot report on your CRA LR as a small business loan. When the CRA regulation was first released back in 1995ish, the regulators decided to piggy-back on the Call Report to define Small Business Loans. IMHO - it was a lazy way out, and when the industry pointed out that MOST smaller business loans have residential real estate as collateral, the agencies did sort of a "Oops" and then came up with this "other" category and said that banks have the option of collecting information on those loans for examiners to consider when evaluating your performance.

It can be very helpful to boost your numbers, especially for loans to businesses with revenues of less than $1MM. However, just beware if you get an examiner who sniffs at those numbers because those loans aren't included in the aggregate data so it's difficult to compare your performance. (No - I'm not bitter at all.......)
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Just sayin'

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#2174457 - 04/20/18 03:41 PM Re: Consumer Loans & Other Loan Data Half Pint
Andy_Z Offline
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Andy_Z
Joined: Oct 2000
Posts: 27,754
On the Net
Put on your Marketing hat. What can you do with this data? You can map it and see where your vehicle loans are coming from, your unsecured, you boat loans, etc. Is there an area you are not getting loans in, but want to - how can you target that geographic area to increase your penetration? Is there a local paper, direct mail marketing to a ZIP code, signage at a branch, billboards, etc.

Seeing where you are and are not making loans can assist in designating branch and ATM locations as well as LPOs, and detect redlining. There are lots of good reasons to analyze the data and show pins on the map.
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#2175778 - 04/30/18 11:02 AM Re: Consumer Loans & Other Loan Data Half Pint
Half Pint Offline
Member
Joined: Sep 2012
Posts: 76
Pennsylvania
Thank you both for your input.

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