Code of Maine Rules
02 - DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION
029 - BUREAU OF FINANCIAL INSTITUTIONS
Chapter 128 - LOANS TO ONE BORROWER LIMITATIONS
Section 029-128-7 - NONCONFORMING LOANS AND EXTENSIONS OF CREDIT

Universal Citation: 02 ME Code Rules ยง 029-128-7

Current through 2024-13, March 27, 2024

1. A loan or extension of credit, within a financial institution's legal lending limit when made, will not be deemed a violation but will be treated as nonconforming if the loan or extension of credit is no longer in conformity with the financial institution's lending limit because:

A. The financial institution's capital has declined, borrowers have subsequently merged or formed a common enterprise, lenders have merged, or the lending limit or capital rules have changed;

B. Collateral securing the loan to satisfy the requirements of a lending limit exception has declined in value.

2. A financial institution must use reasonable efforts to bring a loan or extension of credit that is nonconforming as a result of paragraph 1(A) of this section into conformity with the financial institution's lending limit unless to do so would be inconsistent with safe and sound banking practices.

3. A financial institution must bring a loan that is nonconforming as a result of circumstances described in paragraph 1(B) of this section into conformity with the financial institution's lending limit within 30 calendar days, except when judicial proceedings, regulatory actions or other extraordinary circumstances beyond the financial institution's control prevent it from taking action.

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