Description
This webinar will help you prepare for a regulatory examination of your indirect lending business by evaluating your compliance with the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Background
The creation of the Consumer Financial Protection Bureau (CFPB) is bringing new rules and regulations related to loans to consumers. To help you deal with these rules and regulations, Indirect Dealer Financing Programs: Preparing for Risk Based Examinations will assist you in preparing for a regulatory examination of your indirect lending business through reviewing compliance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank).
Traditionally, institutions that offer dealer financing programs have relied on a delinquency-based approach to evaluate Indirect Dealer Financing Programs (IDFPs) with automobile dealerships. This approach has served institutions well, but indirect automobile financing trends coupled with economic uncertainties related to consumer spending and debt levels have prompted examiners to require a more in-depth analysis of credit risks. As a result, examiners are looking more closely at indirect lending, especially considering Dodd-Frank and the CFPB’s concerns over unfair, deceptive and abusive acts and practices (UDAAP). For credit risk managers, significant risks include loan and collateral values that are not correlated, vehicles that are financed multiple times, and losses that are often deferred and embedded in loan balances.
Why is it so important to prepare for indirect dealer financing examinations?
• Examiners are concerned with UDAAP violations
• Indirect lending is more difficult to monitor and control than direct lending
• Economic conditions are improving, but auto sales could peak and decline in the future
Agenda
Session Agenda:
• Identify key credit and compliance risks related to indirect automobile lending reviewed by examiners - including examples of dealership operations that contribute to the list of key risks
• Identify policies and procedures that are important to the examination process
• Establish standards and requirements for dealerships you will include in your IDFP
• Mitigate risks when funding automobile loan transactions coming from approved dealerships
Benefits
Participate so you can:
• Reduce examiner comments
• Avoid possible enforcement actions
Who Should Attend
• Credit Managers
• Lenders
• Risk Managers
• Internal Auditors
• Compliance Managers