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secondary market. In any event, Peoples needed to retain
ownership of the mortgage loans it made, because its supply of
funds exceeded the demand for its mortgage loans--selling the
mortgages would have further compromised Peoples' net interest
margin and earnings.
d. Loan Monitoring
Peoples monitored loans using paper ledger cards that were
stored in pockets that tracked the day of the month on which each
loan was due, so that if the loan was past due, the card would
remain in what would become a "past due" pocket instead of being
put in a current pocket.
Meetings concerning delinquent loans were held by Peoples'
loan committee. Peoples also had watch lists of problem loans as
required by the FDIC examiners, but they were not used by Peoples
to monitor loans.
6. Fee Income
Income from fees can make a significant contribution to the
income of a bank. Banks may earn income or fees from points and
origination fees on loans, ATM fees, trust fees, credit card
fees, servicing agreements, and insurance sales. Peoples
generally charged no points or fees, however, and had only
minimal fee income from its activities. Peoples did not service
loans made by other depository institutions.
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