This has fallen to me and I needed to clarify a couple of issues for an OCC bank.

1) We are part of the Legal Lending Limit Pilot Program. We only consider balances over 15% of capital when calculating our ratios. When I read 12 CFR 34, it mentions the "aggregate amount of all loans in excess of the supervisory loan-to-value limits". Does this mean I need to consider the full balance of the loan, or only that part above our policy limits for LTV?

2) There is a section in 12 CFR 34 which discusses credit enhancement (read: Private Mortgage Insurance) on 1-4 family loans. We sometimes make loans which are 90.01-95% LTV which have PMI coverage at a higher rate in order to reduce risk. Since we have PMI coverage, do these loans need to be included in our totals as well?

Thanks in advance for everyone's assistance!

1. Under 12 CFR 34 you would include the whole loan amount of a loan when that loan exceeds the supervisory loan to value limits applicable to that loan. Not just the amount that is over the limit.

2. If you have PMI coverage on a loan that exceeds 90% then you don't have to include that loan in the total of loan that exceed the supervisory LTV limits under 12 CFR 34.

3. I don't understand how the Legal Lending Limit Pilot Program relates to this issue.

Frodo -

Thanks for the data. I was only using the LLL Pilot Program as an example of how I prepare other reports to help explain my question.

Thanks,
Tater