North Dakota Administrative Code
Title 13 - Department of Financial Institutions
Article 13-03 - Credit Unions
Chapter 13-03-06 - Credit Union Reserve Funds and Prompt Corrective Action
Section 13-03-06-05 - Requirements

1. Assign credit risk ratings to commercial loans at inception and reviewed as frequently as necessary to satisfy the credit union's risk monitoring and reporting policies;

2. Ensure adequate allowance for loan and lease loss funding as required by generally accepted accounting principles;

3. Include the loan classification categories of watch or special mention, substandard, doubtful, and loss;

4. Accurately identify loan risk ratings and classifications in accordance with accepted industry and regulatory guidance and as assigned during examinations;

5. Establish a process for the board of directors to oversee the performance of the loan portfolio, including periodic reporting to the board of directors aggregate loan portfolio credit risk rating levels, trends, loan classifications as a percentage of the credit union's total reserves or net worth, and loan concentration levels to net worth in relation to established policy limits;

6. Include board of director review of the need for independent review and validation of the accuracy of the commercial loan credit risk rating system and frequency of such action; and

7. Assess the impact of current market conditions and the potential impact of changing market conditions in a stressed environment to include: