HERE'S WHAT WE'RE PREPARED TO HELP YOU ADDRESS:

GET ON TOP OF THOSE NON-PERFORMERS NOW.

• REGULATORS DON'T LIKE TO TELL YOU THINGS ABOUT YOUR LOAN PORTFOLIO YOU DIDN'T KNOW, AND THEY DON'T WANT TO TELL YOU HOW TO FIX IT.
  
  
• THE SOONER YOU MAKE A RECOVERY PLAN, THE MORE YOU WILL RECOVER.
  
  
• ARE YOU THE SQUEAKING WHEEL THAT WILL GET GREASED WHEN THE BORROWERS DO GET SOME CASH, OR ARE YOU BEING NICE GUYS TO PRESERVE THE BORROWER RELATIONSHIPS?
  
  
• THE CONDITION OF THE LOAN PORTFOLIO IS NOT ALWAYS THE PRIMARY REASON THE REGULATORS ISSUE ENFORCEMENT ACTIONS:
  
     • MORE OFTEN, IT IS THE CONDITION COUPLED WITH THE ABSENCE OF APPROPRIATE ACTION BY MANAGEMENT.
     • IF MANAGEMENT CAN DEMONSTRATE THEIR UNDERSTANDING OF THEIR PREDICAMENT AND THEIR WILLINGNESS TO ADDRESS IT IN A VIGOROUS AND TIMELY MANNER, THERE CAN ACTUALLY BE OPPORTUNITIES TO NEGOTIATE WITH THE REGULATORS.
  
  
• SO DON'T PUT OFF, FOR ANY REASON, GETTING STARTED ON A FORMAL ACTION PLAN FOR THE NON-PERFORMERS.

THEN, WHEN WE'VE TURNED OFF THE WATER, WE CAN START MOPPING UP THE OTHER ISSUES:

• WHAT IS THE MOST EFFECTIVE WAY FOR OUR DIRECTORS TO SPEND THEIR TIME?
     • SHOULD THEY BE INVOLVED IN APPROVING LOANS?
     • WHAT INFORMATION SHOULD THEY REVIEW AT REGULAR INTERVALS?
     • WHAT FORMATS PRESENT THAT INFORMATION IN THE MOST USEABLE FORM?
  
  
• WHAT SHOULD THE LOAN POLICY SAY?
     • HOW DOES OUR BANK DEFINE, MEASURE AND CONTROL RISK AND OUR EXPOSURE TO IT?
     • CONCENTRATIONS?   WHAT'S REASONABLE FOR OUR MARKET?   HOW MUCH OF OUR CAPITAL ARE WE WILLING TO RISK ON A SINGLE TYPE OF LOAN OR BORROWER?
     • HOW DO WE DEFINE "CREDIT QUALITY"? HOW DO WE MEASURE IT?
  
  
• WHAT SHOULD OUR PROCESS LOOK LIKE?
     • IS IT EFFICIENT?
     • DOES IT HAVE INTEGRITY?
  
  
• WHOSE JOB IS IT TO SPOT WEAKNESSES IN LOANS?
     • THE CHIEF LOAN OFFICER?
     • THE LENDERS?
     • LOAN REVIEW?
     • THE AUDITORS?
     • THE EXAMINERS?
  
  
• WHAT CRITERIA DO WE USE IN SELECTING, TRAINING, MEASURING AND COMPENSATING OUR LENDING STAFF?
     • HIRING CRITERIA?
     • POSITION DESCRIPTIONS?
     • PERFORMANCE STANDARDS?
     • OBJECTIVES?
     • ONGOING EDUCATION AND TRAINING?
     • EVALUATION?