OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON, D. C. 20551
SUPERVISION AND REGULATION
October 12, 1999
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OF THE FEDERAL RESERVE SYSTEM WASHINGTON, D. C. 20551 |
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| DIVISION OF BANKING SUPERVISION AND REGULATION |
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| SR 99-26 (SUP) October 12, 1999 |
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TO THE OFFICER IN CHARGE OF SUPERVISION AND APPROPRIATE SUPERVISORY AND EXAMINATION STAFF AT EACH FEDERAL RESERVE BANK AND TO STATE MEMBER BANKS WITHIN THE DISTRICT
The Federal Reserve, along with the other federal banking agencies, recently issued additional guidance on high loan-to-value (LTV) residential real estate loans. The press release and interagency statement, which are attached, clarify the agencies' real estate lending guidelines, adopted in 1992, with respect to residential real estate loans.1
The Federal Reserve previously issued guidance on home equity lending and high LTV residential loans in May 1995. This new interagency statement builds on that earlier guidance and provides further discussion of the risks that high LTV loans may pose to banks. The interagency statement also provides clarification of two of the exemptions from the standards, including (i) the "abundance of caution" exemption and (ii) the exemption regarding loans sold promptly without recourse. This SR letter supercedes SR letter 95-31.
Reserve Banks are asked to distributed the attached statement and press release to state member banks in their districts. Questions pertaining to this interagency statement should be directed to Norah Barger, Assistant Director, at (202) 452-2402 or Virginia Gibbs, Senior Supervisory Financial Analyst, at (202) 452-2521.
Director
Superseded: SR 95-31
Notes: 1. Refer to SR 93-1, SR 93-11, and SR 93-33. Return to text
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SR letters | 1999
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