Commercial Lending Compliance Checklist
Commercial Lending Compliance Checklist
I. Compliance Overview
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Objective: Ensure that [Your Company Name] adheres to all relevant legal and industry standards regarding commercial lending practices.
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Responsible Party: [Your Name], [Your Title]
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Date of Last Review: [Date]
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Next Scheduled Review: [Next Review Date]
II. Customer Due Diligence
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[Your Company Name] has established procedures for conducting thorough customer due diligence before approving commercial loans.
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Verify that customer identification and verification procedures are followed according to regulatory requirements.
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Confirm that Know Your Customer (KYC) checks are performed to assess the risk associated with potential borrowers.
III. Loan Documentation
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Ensure that all necessary loan documentation is completed accurately and in accordance with regulatory standards.
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Verify that loan agreements contain all essential terms and conditions, including interest rates, repayment schedules, and collateral details.
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Confirm that loan documentation is reviewed by legal experts to ensure compliance with applicable laws and regulations.
IV. Credit Risk Management
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Conduct thorough credit assessments to evaluate the creditworthiness of commercial loan applicants.
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Verify that risk rating methodologies are applied consistently to assess and mitigate credit risks.
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Monitor credit exposures and establish risk limits to manage credit risk effectively.
V. Regulatory Reporting
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[Your Department] is responsible for ensuring timely and accurate regulatory reporting for commercial lending activities.
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Verify that all required regulatory reports, such as Call Reports or HMDA reports, are submitted on time.
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Confirm that data accuracy and integrity are maintained throughout the reporting process.
VI. Fair Lending Compliance
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Ensure that commercial lending practices comply with fair lending laws and regulations to prevent discrimination.
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Monitor lending decisions and practices to detect and address any potential disparities in treatment.
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Provide fair lending training to staff members involved in the lending process to promote awareness and adherence to fair lending principles.
VII. Anti-Money Laundering (AML) Compliance
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[Your Company Name] has implemented AML policies and procedures to prevent money laundering and terrorist financing activities.
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Conduct customer due diligence checks to identify and verify the source of funds for commercial loan transactions.
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Report suspicious activities to the appropriate regulatory authorities and maintain records of such reports.
VIII. Signature
I, [Your Name], hereby acknowledge that I have reviewed the Commercial Lending Compliance Checklist Template for [Your Company Name] and affirm our commitment to implementing and maintaining the outlined procedures and practices to ensure compliance with commercial lending standards.
Your Company Name]
Date:
