Pennsylvania Code › Title 10 - BANKING AND SECURITIES › Part III - Savings Association Bureau › Chapter 34a - CONSUMER LOANS, COMMERCIAL PAPER AND CORPORATE DEBT SECURITIES › Section 34a.1 - Definitions

Current through Register Vol. 54, No. 28, July 13, 2024
The following words and terms, when used in this chapter have
				  the following meanings, unless the context clearly indicates otherwise:
Association
-A savings association subject to
				  the Code.
Code
-The Savings Association Code of 1967
				  (7 P.
				  S. §§
										6020-1-6020-254).
Closed-end consumer credit
-Consumer credit
				  other than open-end consumer credit.
Commercial paper
-Any note, draft or bill of
				  exchange which arises out of a current transaction or the proceeds of which
				  have been or are to be used for current transactions and which has a maturity
				  at the time of issuance not exceeding 9 months, exclusive of days of grace, or
				  any renewal thereof the maturity of which is likewise limited.
Consumer credit
-Credit extended to a natural
				  person for personal, family or household purposes including loans secured by
				  liens on real estate and chattel liens secured by mobile homes; provided, the
				  association relies substantially upon other factors such as the general credit
				  standing of the borrower, guarantees, or security other than the real estate or
				  mobile home as the primary security for the loan; appropriate evidence to
				  demonstrate justification for such reliance should be retained in the
				  association's files. Among the types of credit included in this term are
				  consumer loans; educational loans; unsecured loans for real property
				  alteration, repair or improvement or for the equipping of real property; loans
				  in the nature of overdraft protection; and credit extended in connection with
				  credit cards.
Consumer credit classified as a loss
-Closed-end consumer credit delinquent 120 days or more-5 monthly payments or
				  more-and open-end consumer credit delinquent 180 days or more-seven
				  zero-billing cycles or more. For the purposes of computing delinquency, a
				  payment of 90% or more of the contractual payment will be considered as a full
				  payment. If an association can clearly demonstrate that repayment would occur
				  regardless of delinquency status-for example: the loan is well-secured by
				  collateral and is in the process of collection, the loan is supported by a
				  valid guarantee or insurance, or it is a loan where claims have been filed
				  against a solvent estate-then such loan need not be classified as a loss. The
				  following table illustrates the delinquency computation:
Closed-end consumer credit
Due Date
Period
Delinquency Status
Classification
3/10
3/10-4/09
Not delinquent
-
6/10
6/10-7/09
90 days or 4
						  payments
Slow
7/10
7/10-8/09
120 days or 5
						  payments
Loss*
8/10
8/10-9/09
150 days or 6
						  payments
Loss*
Open-end consumer credit
Statement
Day
Cycle
Payment Record
Delinquent
Classification
1
1
-
-
0
-
7
180
6
No payment
150
Slow
8
210
7
No payment
180
Loss*
9
240
8
No payment
210
Loss*
*Charge-off as required.
Consumer loan
-A secured or unsecured loan to
				  a natural person for personal, family, or household purposes. Such loan-as a
				  type of consumer credit-may be made as either open-end or closed-end consumer
				  credit but does not include credit extended in connection with credit cards and
				  loans in the nature of overdraft protection.
Corporate debt security
-A marketable
				  obligation, evidencing the indebtedness of any corporation in the form of a
				  bond, note, or debenture which is commonly regarded as debt security and is not
				  predominantly speculative in nature. A security is marketable if it may be sold
				  with reasonable promptness at a price which corresponds reasonably to its fair
				  market value.
Loans
-Obligations and extensions or advances
				  of credit. Any reference to a loan or investment includes an interest in such a
				  loan or investment.
Open-end consumer credit
-"Open-end credit"
				  as defined in Regulation Z ( 12 CFR 226.2.
Scheduled items
-Slow consumer credit and
				  slow loans other than loans specified in the Definition of "consumer credit
				  classified as a loss."
Slow consumer credit
-Closed-end consumer
				  credit delinquent 90 to 119 days-four monthly payments-and open-end consumer
				  credit delinquent 90 to 179 days four to six zero-billing cycles. For the
				  purposes of computing delinquency, a payment of 90% or more of the contractual
				  payment will be considered as a full payment. If an association can clearly
				  demonstrate that repayment would occur regardless of delinquency status-for
				  example: the loan is well-secured by collateral and is in the process of
				  collection, the loan is supported by a valid guarantee or insurance, or it is a
				  loan where the claims have been filed against a solvent estate-then such loan
				  need not be classified as "slow consumer credit." The following table
				  illustrates the delinquency computation:
Closed-end consumer credit
Due Date
Period
Delinquency Status
Classification
3/10
3/10-4/09
Not delinquent
-
4/10
4/10-5/09
30 days or 2
						  payments
-
5/10
5/10-6/09
60 days or 3
						  payments
-
6/10
6/10-7/09
90 days or 4
						  payments
Slow
Open-end consumer credit
Statement
Day
Zero Billing Cycle
Payment Record
Days
						  Delinquent
Classification
1
1
-
-
0
-
2
30
1
No payment
5*
-
3
60
2
No payment
30
-
4
90
3
No payment
60
-
5
120
4
No payment
90
Slow
6
150
5
No payment
120
Slow
7
180
6
No payment
150
Slow
*For purposes of illustration, assume
						  consumer has 25 days in which to pay before payment is considered delinquent.
This section cited in 10 Pa. Code §
											34a.4 (relating to scheduled items
					 and consumer credit classified as a
					 loss).