ALLOWANCE FOR LOAN AND LEASE LOSS METHODOLOGY
FinPro's ALLL Methodology Review ensures that the Bank is up-to-date on the most recent industry best practices. The review is conducted by the members of FinPro's "Senior Bank Regulatory" staff.
The process includes a:
- Review of last internal loan review;
- Review of last external loan review;
- Review of the FAS 114 (ASC 310) analysis on each significant credit;
- Review of the stratification of FAS 5 (ASC 450) pools.
The application of qualitative and eight environmental adjustments to each ASC 450 pool;
- Change in local and national economic conditions
- Level and trend of past dues
- Composition and Concentration of Credit
- Level and trend of charge offs and recoveries
- Trend in volume and terms of loans
- Effectiveness of loan policies, procedures, and internal controls
- Experience of lending management and staff
- Changing economic conditions