Board of directors and management responsibilities.

CFR · 2024-01-01 · US · Title 12

Prior to engaging in commercial lending, a federally insured credit union must address the following board responsibilities and operational requirements: (a) (1) Approve a commercial loan policy that complies with § 723.4 of this part. The board must review its policy on an annual basis, prior to any material change in the federally insured credit union's commercial lending program or related organizational structure, and in response to any material change in portfolio performance or economic conditions, and update it when warranted. (2) Ensure the federally insured credit union appropriately staffs its commercial lending program in compliance with paragraph (b) of this section. (3) Understand and remain informed, through periodic briefings from responsible staff and other methods, about the nature and level of risk in the federally insured credit union's commercial loan portfolio, including its potential impact on the federally insured credit union's earnings and net worth. (b) (1) (2) (i) Underwriting and processing for the type(s) of commercial lending in which the federally insured credit union is engaged; (ii) Overseeing and evaluating the performance of a commercial loan portfolio, including rating and quantifying risk through a credit risk rating system; and (iii) Conducting collection and loss mitigation activities for the type(s) of commercial lending in which the federally insured credit union is engaged. (3) (i) The third-party has no affiliation or contractual rel

official document · source cfr-2024 · id 12:§ 723.3