What are Patriot National Bancorp Inc's Business Segments?
The ALL for homogeneous loans is calculated using a systematic methodology with
both a quantitative and a qualitative analysis that is applied on a quarterly
basis. The ALL model is comprised of five distinct portfolio segments:
Commercial Real Estate
Residential Real Estate
Construction
Commercial
Consumer
Each segment has a distinct set of risk characteristics monitored by management.
We further assess and monitor risk and performance at a more disaggregated level
which includes our internal risk rating system for the commercial segments and
type of collateral, lien position and loan-to-value, or LTV, for the consumer
segments.
We first apply historical loss rates to pools of loans with similar risk characteristics.
Loss rates are calculated by historical charge-offs that have occurred within
each pool of loans over the loss emergence period, or LEP. The LEP is an estimate
of the average amount of time from the point at which a loss is incurred on a
loan to the point at which the loss is confirmed. In general, the LEP will be
shorter in an economic slowdown or recession and longer during times of economic
stability or growth, as customers are better able to delay loss confirmation after
a potential loss event has occurred.
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