2019 Journal of Community Bank Case Studies

2019 COMMUNITY BANK CASE STUDY COMPETITION

Exhibit 9: Loan Portfolio Composition

Board

Chief Executive Officer

Audit Committee

Chief Financial Officer

Chief Risk Officer

Information Security

Regulatory Liaison

Compliance

Risk Management

Loan Review

Internal Audit

Consumer Compliance

Commerical Loan Review

Applications Access

Operational Risk

Mortgage Compliance

Systems Access

Asset Quality Analysis

Fraud Risk

Home Mortgage Disclosure Act

Business Continuity

Appraisal

Bank Secrecy Act

Investigations

Physical Security

Fair Lending

FirstBank has a highly dedicated team focused on the compliance and security of FirstBank’s operations. The Board of Directors and three chief officers, CEO Chris Holmes, CFO James Gordon and CRO Tim Johnson, oversee six divisions within the Risk Department. Approximately 100 full-time equivalents within FirstBank are dedicated to compliance (Durham). Compliance and regulation, however, affects the day-to-day business of almost every employee at FirstBank. The sheer magnitude of the Risk Department, presented in Exhibit 9, demonstrates the costliness of compliance.

Employees in the Regulatory, Information Security, Compliance, Risk Management, Loan Review, and Internal Audit function report to the CRO, Tim Johnson. Risk information from these functions flows to the Board of Directors. Laurie Durham, Regulatory Liaison, is responsible for understanding and implementing the regulations that affect FirstBank. Durham performs a key function within the Risk Department, as her knowledge and guidance benefits all branches and other subdivisions in the Risk Department. The Information Security division is responsible for ensuring that there is only authorized use of information and that all systems are protected

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