商業(yè)銀行管理peterrossChapter18課件

ChapterEighteenConsumerLoans,CreditCards,andRealEstateLendingCopyright

?2010byTheMcGraw-HillCompanies,Inc.Allrightsreserved.McGraw-Hill/IrwinChapterEighteenConsumerLoans1KeyTopicsTypesofLoansforIndividualsandFamiliesUniqueCharacteristicsofConsumerLoansEvaluatingaConsumerLoanRequestCreditCardsandCreditScoringDisclosureRulesandDiscriminationLoanPricingandRefinancing18-2KeyTopicsTypesofLoansforI2ConsumerLendingHasbeenamongthemostpopularfinancialservicesofferedinrecentyearsOneofthemostimportantsourcesofrevenuesanddepositsforbanksandtheircompetitors(creditunions,savingsassociations,andfinanceandinsurancecompanies);asourceofsupplementalincomeOntheotherhand,presentsaspecialchallengeduetohigher-than-averagedefaultrates.18-3ConsumerLendingHasbeenamong3PerformanceandChargeoffsbyBankCategory,12/20040.76%1.23%4.01%1.30%1.18%1.66%1.66%1.10%1.35%0.0%0.5%1.0%1.5%2.0%2.5%3.0%3.5%4.0%4.5%5.0%InternationalBanksAgriculturalBanksCreditCardLendersCommercialLendersMortgageLendersConsumerLendersOtherSpecialized<$1BillionAllOther<$1BillionAllOther>$1Billion18-4PerformanceandChargeoffsby4TypesofConsumerLoansClassifyConsumerLoansbyPurpose–WhattheBorrowedFundsareUsedFor,orbyType–WhethertheBorrowerMustRepayinInstallmentsorinOneLumpSumResidentialMortgageLoansNonresidentialLoansInstallmentLoansNoninstallmentLoansCreditCardLoansandRevolvingCredit18-5TypesofConsumerLoansClassif5ResidentialMortgageLoans

CredittoFinancethePurchaseofResidentialPropertyintheFormofHousesandMultifamilyDwellings.ThisisUsuallyaLong-TermLoan(15-30years)WhichisSecuredBythePropertyItself.FixedorVariableRateofInterest18-6ResidentialMortgageLoans18-66NonresidentialLoans:InstallmentLoans

Short-TermtoMedium-TermLoansRepayableinTwoorMoreConsecutivePayments,UsuallyMonthlyorQuarterly.TheseAreOftenUsedtoFinanceBigTicketPurchasesorConsolidateExistingDebt(automobile,furniture,appliances).18-7NonresidentialLoans:Installm7NoninstallmentLoans Short-TermLoansByIndividualsforImmediateCashNeedsandRepayableinOneLumpSumWhentheBorrower’sNoteMatures(chargeaccounts,medicalcare,autoandhomerepairs)18-8NoninstallmentLoans Short-Ter8CreditCardLoansCreditCardsOfferHoldersAccesstoEitherInstallmentorNoninstallmentCredit.BanksFindThattheInstallmentUsersofCreditCardsaretheMostProfitable–ProvideHigherRisk-AdjustedReturnsThanOtherTypesofLoans.Cardissuersearnincomefrom:Cardholders’annualfeesInterestonoutstandingloanbalancesDiscountingthechargesthatmerchantsacceptonpurchases.18-9CreditCardLoansCreditCards9CreditCardRegulationsU.S.RegulatorsofDepositoryInstitutions--OCC,Fed,FDIC,andOTS--in2003,MovedtoSlowtheExpansionofCardOfferstoCustomerswithLowCreditRatingsMorerecently,May2009:Strictlimitsonmarketingtocollegestudentsandotherprospectivecardholdersundertheageof21PreventingcardholderaccountsfrombeingchargedbeyondtheirlimitsClearerdisclosureofcreditcardinterestratesandrepaymentestimates,usingstandardtextsizesandstylesTougherrulesrelatedtoraisinginterestratesondelinquentcardholders,withclearpathstorehabilitatecreditcardaccounts.18-10CreditCardRegulationsU.S.Re10DebitCards

DebitCardsCanBeUsedToPayForGoodsAndServices,ButNotToExtendCredit.TheyAreAConvenientVehicleForMakingDepositsIntoAndWithdrawalsFromATMsAndTheyFacilitateCheckCashing.18-11DebitCards 18-1111OutstandingConsumerDebtasaPercentofDisposableIncome18-12OutstandingConsumerDebtasa12ConsumerDebtServiceRatio18-13ConsumerDebtServiceRatio18-13CharacteristicsofConsumerLoansMostCostlyandMostRiskytoMakePerDollarCyclicallySensitiveInterestInelastic18-14CharacteristicsofConsumerLo14EvaluatingaConsumerLoanApplicationCharacterandPurposeIncomeLevelsDepositBalancesEmploymentandResidentialStabilityPyramidingofDebt18-15EvaluatingaConsumerLoanApp15CreditBureausCreditReportingAgenciesorCreditBureausAssembleandDistributetoLenderstheCreditHistoryofMillionsofBorrowersInformationPersonalIdentifyingDataPersonalCreditHistoriesPublicInformationThatMayHaveBearingonLoan18-16CreditBureausCreditReporting16CreditScoring CreditScoringSystemsareBasedonSophisticatedStatisticalModelsinWhichSeveralVariablesareJoinedtoEstablishaNumericalScoretoSeparateGoodLoansFromBadLoans.TheMostFamousofTheseistheFICOScoringSystemDevelopedbyFairIsaac.18-17CreditScoring18-171718-1818-1818LawsandRegulationsApplyingtoConsumerLoansDisclosureRulesTruthinLendingAct,passedin1968,simplifiedin1981FairCreditReportingAct,1974FairCreditBillingActFairDebtCollectionPracticesActAntidiscriminationLawsEqualCreditOpportunityActCommunityReinvestmentActHomeOwnershipandEquityProtectionAct18-19LawsandRegulationsApplying19EthicsinBankingBox:IdentityTheftFastestGrowingCrimeAgainstIndividualsTodayItCanbeDifficulttoDetectandCostlytoRecoverFromFairCreditandAccurateCreditTransactions(FACT)ActwasPassedin2003toCounterthisGrowingProblemConsumersEntitledtoOneFreeCreditReportAnnuallyfromEachoftheThreeMajorCreditBureaus18-20EthicsinBankingBox:Identit20PredatoryLendingandSubprimeLoans

AnAbusivePracticeAmongSomeLendersThatConsistsofGrantingLoanstoSubprimeBorrowersandChargingThemExcessiveInterestRatesandFees,IncreasingtheRiskofDefault.SubprimeLendingPlayedImportantRoleinthe2007CreditCrisis.18-21PredatoryLendingandSubprime21RealEstateLoansAmongtheRiskiestLoansBanksCanMakeAverageSizeisLargerThantheAverageSizeofOtherLoansTendtoHaveLongerMaturitiesThanOtherLoans18-22RealEstateLoansAmongtheRis22FactorsUsedinEvaluatingRealEstateLoansSizeofDownPaymentRelativetoPurchasePriceofPropertyShouldBeEvaluatedinTermsofTotalRelationshipNeedtoPayAttentiontoParticularAspectsofCreditApplication:AmountandStabilityofIncome(GrossDebtService)AvailableSavingsandSourceofDownPaymentTrackRecordinMaintainingPropertyOutlookforRealEstateMarketinLocalAreaOutlookforInterestRatesIfVariableRateLoan18-23FactorsUsedinEvaluatingRea23HomeEquityLendingHomeOwnersCanUsetheDifferenceinHome’sEstimatedValueandRemainingMortgagesasaBorrowingBaseTwoTypesofCreditClosedEndCreditLinesofCreditCanBeUsedforAnyLegitimatePurposeThe1986TaxReformActHasHelpedThisTypeofLoanGrowinPopularity18-24HomeEquityLendingHomeOwners24InterestOnlyMortgages:TheMostControversialofHomeMortgageLoansManyoftheseareAdjustableRateMortgagesHomeOwnerCanPaytheInterestOnlyforanInitialPeriodMortgagePaymentsCanbeMuchHigherWhenPrincipalPaymentsareDueBecauseoftheShorterPeriodtoRepaytheLoanEspeciallyProblematicWhenHousePricesStopClimbingUpwardDuringtheRecentCrisis,theFedMovedtoTightentheRulesonMortgageLendingtoPromoteGreaterTransparencyinLoanTerms18-25InterestOnlyMortgages:TheM25QuickQuizHowdocredit-scoringsystemswork?Whataretheprincipaladvantagestoalendinginstitutionofusingacredit-scoringsystem?Inwhatwaysisarealestateloanuniquecomparedtootherkindsofbankloans?Whatfactorsshouldalenderconsiderinevaluatingrealestateloanapplications?Whatlegalprotectionsareavailabletodaytoprotectborrowersagainstdiscrimination?Againstpredatorylending?Whatforcesarereshapinghouseholdlendingtoday?18-26QuickQuizHowdocredit-scorin26Cost-PlusModelofPricingLoans18-27Cost-PlusModelofPricingLoa27AnnualPercentageRate(APR) TheAPRistheInternalRateofReturnthatEquatesTotalPaymentsWiththeAmountoftheLoan.TheTruthinLendingActRequiresThatThisRateBeDisclosedtoConsumersOnAllLoans18-28AnnualPercentageRate(APR)1828SimpleInterest InSimpleInteresttheCustomerOnlyPaysInterestOntheAmountofthePrincipalLeft.FirsttheDecliningLoanBalanceisCalculatedandThatReducedBalanceisUsedtoCalculatetheAmountofInterestOwed $3,000loanat12%simpleinterestperyearproduces$360ininterest,ora12percenteffectiverateinterest(is):=$3,000(0.12)(1)=$36018-29SimpleInterest18-2929DiscountRateMethod

TheDiscountRateMethodRequirestheCustomertoPaytheInterestinAdvance.InterestisDeductedFirstandtheCustomerReceivestheLoanAmountLessAnyInterestOwedConsidera1-yearloanwithasingle$3,000paymentatmaturity.Theborrowerreceivesonly$2,640,orthetotalloanminus12%discountrateinterest.Theeffectiveannualpercentagerate,orAPR,equals13.64%Interestcharge=0.12($3,000)=$36018-30DiscountRateMethod TheDisco30Add-OnLoanRateMethod

InterestOwedisAddedtothePrincipalAmount,ThentheLoanPaymentsareCalculatedByDividingThisSumBytheNumberofLoanPayments18-31Add-OnLoanRateMethod18-3131Ruleof78s

ARuleofThumbtoDetermineExactlyHowMuchInterestIncomeaBankisEntitledtoAccrueatAnyPointinTimeFromanInstallmentLoanBeingPaidinMonthly18-32Ruleof78s18-3232InterestRatesonHomeMortgagesFixedRateMortgage(FRM)–1