Regulatory Alerts2020-11-10
Earnings Ratings for Fiduciary Activities
Regulators mandate earnings ratings for institutions with over $100 million in trust assets to evaluate the profitability and risk of fiduciary activities. The primary rating scale ranges from 1 for strong earnings to 5 for critically deficient performance, based on factors such as consistency, management oversight, and expense allocation. Institutions below the mandatory threshold may receive alternate ratings determined by their implementation of four minimum board standards regarding income measurement and service justification.
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