Retail Lending Examination Procedures

Over-limits

Objective: Evaluate the quality of accounts in over-limit status.

Sample size – 30 Accounts with balances that equal or exceed the assigned credit limit by a certain threshold (such as 20 percent or more) as of last statement cycle date.

  • Verify why accounts are over credit limits, and if there are any authorization, insufficient funds, or other issues involved.

  • Verify when over-credit-limit (OCL) fees are imposed, and if and when OCL fees are suspended.

  • Verify how the minimum payment is calculated.

  • Evaluate sample for accounts with negative amortization.

  • Determine length of time in OCL status.

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