Retail Lending Examination Procedures

Line Increases

Objective: Evaluate the change in credit risk and appropriateness of line increases.

Sample size – 30

Accounts with automatic line increases in last 180 days.

Select accounts from different products.
Select accounts from a full range of risk scores but with proportionately more accounts with lower scores.
Include accounts with line utilization greater than 75 percent.
Test for consistency with credit criteria.
Evaluate the size of the line increase relative to creditworthiness.
Consider how much credit risk is added to the portfolio.

Sample size – 30

Accounts with manual line increases in last 90 days.