First National Corporation
Climate Impact & Sustainability Data (2011)
Reporting Period: 2011
Environmental Metrics
Climate Goals & Targets
Environmental Challenges
- High levels of non-performing assets
- Deteriorating credit quality, particularly in real estate loans
- Weakness in the residential and commercial real estate markets
- Historically high levels of non-accrual loans
- Concentrations of loans
- Difficult market conditions
- Competition in the banking industry
- Extensive regulation
- Potential future losses may result in an additional valuation allowance for deferred tax assets
- Increases in FDIC insurance premiums
- Reliance on secondary sources of funding
- Soundness of other financial institutions
Mitigation Strategies
- Aggressive collection on loans and reduction of non-performing assets
- Rewriting credit policies and establishing clear underwriting guidelines
- Improving pricing for risk and strengthening controls
- Selling other real estate owned (OREO) and restructuring problem loans
- Enhancing credit risk management practices, appraisal policies and procedures for collateral, improved underwriting and risk grading tools, and more effective management from consolidated credit administration and loan operations functions
- Focus on reducing non-performing asset levels
- Maintaining sufficient capital to remain in compliance with capital requirements
- Suspending cash dividends on common stock