OCC BULLETIN 2004-59
Subject: Retail Lending
Date: December 22, 2004
To: Chief Executive Officers of National Banks, Department and Division Heads, and All Examining Personnel
Description: Interim Examination Procedures
During the last several years, the Office of the Comptroller of the Currency (OCC) has seen significant changes in the retail lending activities of national banks. For many banks, retail lending has become a more prominent part of lending activities and a major contributor to overall profitability. More generally, the mix and complexity of products that banks offer and the availability of credit to consumers has expanded. Concurrent with this growth have been changes in the ways that banks manage their retail portfolios.
In light of these developments, the OCC is issuing the attached Retail Lending Examination Procedures. The procedures address the various risk management and control functions that banks need to manage more diverse and complex portfolios and provide targeted procedures for specific credit functions and types of retail loans. The procedures also incorporate the provisions of the interagency Uniform Retail Credit Classification and Account Management Policy (issued in 2000) and the interagency Account Management and Loss Allowance Guidance (issued in 2003).
The Retail Lending Examination Procedures are structured to accommodate ongoing supervision of all types of retail credit products, and more comprehensive examinations of high risk or larger, more complex operations. The procedures are divided into two parts:
The OCC plans to incorporate the procedures in an update to the Comptroller's Handbook series at a later date. Until a revised handbook is issued, examiners should use the attached procedures. Questions about these procedures may be directed to your supervisory office or to the Credit Risk Department at (202) 649-6670.
Barbara J. Grunkemeyer