FDIC Directions

FDIC is under new management. The Honorable John Reich, Director, FDIC, addressed the attendees at ABA's National Regulatory Conference and outlined the agency's new priorities. High on the list is making FDIC a leader in research. Chairman Powell intends to make FDIC a research activist.

FDIC will also be a leader in bank supervision. The FDIC Board has a goal of addressing issues before they affect the industry. Closely related to the supervision goal is the goal of being a leader in developing bank policy relating to safety and soundness, risk, and deposit insurance.

Powell also plans to open doors to the FDIC and bring in new ideas. He is in the process of creating a 15-member advisory board with representation from all segments of the economy. In addition, the FDIC will develop a university to enhance the educational opportunities for all of its employees.

In addition to these broad goals are some more specific changes to examinations. Some examinations will be streamlined.

Institutions with assets of less than $250 million and a CAMEL rating of 1 or 2 should see a 20% reduction in examination time.Examination procedures will focus on risk, including compliance risk. Examiners will take a top-down approach beginning with the bank's management of its compliance program. Banks having strong compliance programs with management support should find that examinations take less time. It's a good reason to have a strong compliance program.

Copyright © 2002 Compliance Action. Originally appeared in Compliance Action, Vol. 7, No. 8, 7/02