Large Bank Supervision Forum 2023

The 2013 Guidance Leveraged Lending Definition

Regulator Concerns  Lack of local deliberation – What aspect(s) of this market specifically work for our bank?  Lifts the definition directly out of the Guidance  Local definition exceeds regulator intent Best Practices  The definition is one component of a defined business plan and an element of a separately constructed leveraged lending credit policy.  Bank considers and defines its specific appetite for leveraged lending involvement  Includes risk appetite, industries, geographies, capital contribution, ROA

For financial professional or qualified institutional investor use only. Not for inspection by, distribution or quotation to the general public.

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The 2013 Guidance Credit Policy Expectations

Regulator Concerns  Force leveraged lending practices into traditional C&I processes  No separate policy considerations  Lack of specific ALLL methodology  Full Board of Directors and Executive Management buy ‐ in Best Practices  A separate, board ‐ approved credit policy governs leveraged lending  Specific approval, provisioning and governing practices  Specific limits (borrower, industry, risk grade, underwriting, capital)

For financial professional or qualified institutional investor use only. Not for inspection by, distribution or quotation to the general public.

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