The Office of the Comptroller of the Currency has warned banks of companies that have begun offering programs that would allow them to reduce their non-performing assets by exchanging other real estate owned (OREO) for an interest in another asset purported to be performing. The OCC said these programs can raise “significant safety and soundness, legal, and accounting concerns,” and it “strongly encourages” national banks to consult with their supervisory offices before entering into any such agreements.
