As the premier trade association of the asset-based lending and factoring industries, one of CFA’s core functions is to represent its members on critical public policy and legal issues that could have an impact on the commercial finance industry. CFA’s advocacy program is directed by its Advocacy Committee.
The CFA Advocacy Committee determines the Association’s position and strategy on legislative and regulatory issues that could affect the asset-based lending and factoring industries. The Committee also works with CFA’s Co-General Counsel to identify and approve actions the Association takes on legal issues affecting the industry, including amicus curiae briefs.
OCC Releases Asset Based Lending Handbook to Guide Examiners Assessment of ABL
On March 27, 2014, the Office of the Comptroller of the Currency (OCC) released its Comptrollers Handbook on Asset Based Lending. The booklet provides guidance to examiners and bankers regarding ABL activities and risks, prudent credit risk management and underwriting expectations, credit administration, and credit risk rating. Risk-based expanded examination procedures are provided to guide ABL examinations. Expanded topics include ABL structures, credit analysis, evaluating borrower liquidity, establishing a borrowing base and prudent advance rates, collateral controls and monitoring systems, and credit risk rating considerations. The booklet also includes transaction examples to guide examiners and bankers in the assessment of credit risk.
The 78 page ABL Handbook replaces the Accounts Receivable and Inventory Financing booklet of the Comptroller’s Handbook, issued in March 2000, and replaces ABL guidance in section 214, “Other Commercial Lending,” issued in October 2009 as part of the Office of Thrift Supervision’s (OTS) Examination Handbook.
The OCC declined CFA’s offer to provide input during the drafting process but has requested that feedback on the final version be solicited from CFA members. CFA’s Advocacy Committee is collecting feedback from all CFA members. The Advocacy Committee’s OCC & Regulatory Affairs Subcommittee will synthesize the comments collected and provide feedback to the OCC as requested.
To access the ABL Handbook, click here