Introduction to Mortgage Origination Examiniations

Internal Use Only

Sensitivity to Market Risk Risk Management: • Program in place to manage rate risk • Policies should clearly state risk tolerances and & acceptable level of loss • Procedures should include measurement, monitoring & controlling threats

Internal Use Only

Sensitivity to Market Risk Interest Rate Risk:

The risk that changes in market interest rates will negatively affect the value of assets on the balance sheet & the level of income produced by those assets