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analyst (who would compile the information and prepare a written
analysis), a junior credit officer, and a senior credit officer.
The credit officers also would consult with the relationship
managers and marketers before assigning a risk classification.
FNBC’s credit officers set a potential counterparty’s risk
class rating by first referencing the counterparty’s public debt
rating. FNBC could rate a counterparty differently than its
public debt rating but generally did not give the customer a risk
class rating higher than its public debt rating.
c. Review of Risk Classifications
FNBC regularly reviewed the credit ratings of its customers.
Credit officers and relationship managers would regularly review
the customer’s financial statements and news reports relating to
the customer and would hold discussions with the customer.
Reviews would also occur each time the customer sought additional
credit which was not covered by established credit limits.
Formal credit reviews of each customer would occur at least
annually.
The credit risk classifications were reviewed both
internally and externally. Internally, a unit of the bank known
as “Credit Process Review” (CPR) would review the ratings
assigned by the credit officers and the thoroughness of their
analysis. CPR did not always agree with the ratings and the
analysis of the credit officers and would sometimes upgrade or
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