SNC ReView^TM and the Shared National Credit Program

SNC ReView™ was established in 2022 to provide risk management consulting services to financial institutions that participate in the Shared National Credit Program ( SNC Program ). The SNC Program is an interagency program administered by three federal banking regulatory agencies which include the Federal Reserve System, Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation ( the “Regulators” ). The program began in 1977 and assesses risk in the largest and most complex credits that have a minimum aggregate loan commitment threshold of $100 million. These credits are led by an Agent and shared by three or more regulated financial institutions. Participants in these credits include US banking institutions, foreign banking organizations and Nonbanks. Regulators generally conduct SNC examinations in the first and third quarters each year at the Agent banks and exam results are subsequently communicated to Participants. Important objectives of the SNC program include a uniformity in approach and credit rating determinations, allowing Regulators to gain efficiencies in risk analysis and rating determinations, and providing timely results to Agents, Participants and Regulators. Achieving these objectives promotes the safety and soundness of the financial system. 

The SNC population currently totals more than $5 trillion in commitments to more than 5,000 borrowers, with several thousand lenders participating in the SNC program and subject to its credit rating determinations and regulatory consequences.

An institution that fails to fully comply with SNC Program requirements and guidelines can fall short of safety and soundness principles and expectations and will generally face serious regulatory consequences. For some institutions, full compliance with the SNC Program can be challenging at times, and their compliance can be impacted by a wide range and number of factors. In addition to the primary factors of properly assessing credit risk and establishing accurate credit ratings, other contributing challenging factors may at times include operational risk considerations, due in part to potentially how the Agent has rated the credit or handled the SNC exam process. As a result, in some cases, SNC exams may result in a higher percentage of risk rating downgrades for them as Participants than as Agents. A high level of Participant downgrades can lead to poor exam results and adverse regulatory consequences.  An important goal of the services SNC ReView™ provides to Agents and Participants is to help them recognize unique risk factors, fully meet SNC Program requirements and avoid adverse exam results.