Has anyone had experience with being made to designate a compliance officer with just the separate duties of compliance and nothing else? We are a state, non-member, 120 million asset sized bank and I do compliance, as well as manage the loan documentation department. We are up for an exam and are anticipating being told those duties need to be separated and that we need full time compliance for this size. Any comments on what your banks are doing and how they are structured?

Just curious - what's the basis for your anticipation of this change? Prior exam comments? Informal discussions with your regulator? Safety & soundness concerns? Our bank didn't get a full-time compliance officer until we were about twice your size, but everyone is different...

I think I'd put myself in the same box you are - we're just over $500 million, and I do compliance & CRA. Our regulators have suggested that we separate the functions, so I'm looking at options and building a business case.

I'll tell you this, though - over the last 14 years, the only way I've ever been able to 'get rid of' any duties has been through either corporate reorganization (at a couple of multi-billion dollar banks I've worked for) or through leaving the bank entirely. It's always easier to acquire new responsibilities than unbundle current ones.

Send me e-mail at bjonker@bcsbank.com if you'd like details about our current structure.

We are a state, nonmember bank of 300 million+. Up until 1999, our Compliance Officer was also a Branch Manager and Loan Officer. The FDIC never said anything. It seems to be typical in small or smaller banks for CO's to wear multiple hats. I know of a CO who is also HR manager. The only time I have heard any criticism is when the CO is also the Auditor.

We are an FDIC regulated bank of $110 million in assets. Based on our last few internal audits and FDIC exams, compliance duties were removed from a loan officer and my job as compliance officer was created. Lucky for me! Technically I am also a collector, but due to the state of compliance, I have been focusing most of my attention on compliance, review, writing policy, etc. I have only been assisting loan officers in collection efforts a few hours each week.

We are a $100M bank, and the FDIC during our last exam told us we needed a full-time compliance officer. Even though I'm the CO, I also occasionally do lending. We have another person who is an internal auditor, also full-time.

Anon,

Just a couple of cents to add. We are a $160 million state-member bank with 5 locations. I was hired last year for compliance and internal audit. Members of the Fed staff who visited us in December stated that they were impressed that the Bank hired a full-time compliance/auditor type person and, in their own words, "were surprised that a Bank our size even had one." They said they usually didn't see this.

Someone else in the Bank is BSA Officer, Security Officer, AML Officer, etc., etc. So far it has worked out very well. Since I have no other responsibilities besides auditing and compliance I am able to perform those functions independently and I answer directly to the CEO, Audit Committee or Board of Directors as necessary.

We also enjoy a visit a couple of times a year from an outside auditing firm. The amount of auditing they do depeneds on how much I do and how well I've documented.

I was Compliance Officer, BSA Officer, CRA Officer and head auditor for a bank of over 500 mil. Boy...how did I ever do all that! I don't know of the FDIC ever mentioning that the duties needed to be seperated. I guess if your compliance examination didn't go well then that might be suggested.

BWest

Interesting reponses. I am the President of Banker's Compliance Consulting (BCC). I started the company in 1993 to fill a nitch that I saw - renting a compliance officer for small banks that couldn't afford a full time CO. BCC now provides consultation (in bank reviews, phone consultation, seminars, etc.) for about 350 banks primarily in the Midwest. The reason I tell you this is to set a platform. We rarely see a full time CO in banks of <$200 million. That's seems to be the bench mark to switching to a full time CO or at leat greatly delegating compliance duties to a committee. If examiners have told a bank that they need a full time CO in a bank of <$200 million I have to assume:
1) there were some real compliance challenges, or
2) the examiners stepped over their area of expertise, or
3) both.

I'm not saying a bank of <$200 million wouldn't like to have a full-time CO, but it is usually a luxury rather than a necessity.

I am the compliance officer, BSA officer, OFAC and AML officer and Privacy officer for my Bank ($200 million). I don't see problem with your situation, especially given the size of your Bank. People often wher multiple hats.

Thanks for all the great responses-guess they can suggest what they want (regulators) and we have to deal with it at that time. It seems natural to manage the loan documentation department and do compliance, only a little overwhelming at times (as you all know too well). We are okay as far general compliance, but some compliance folks prior to me have left a not so clear trail of what was done, so maybe it will ease up after a bit.

My bank is a state non-member bank with 28 branches and assets in excess of a billion. There are two of us in the Compliance Department. One of us "specializes" in the operations side...the other in lending compliance, though we both are knowledgable in both areas. This "two for the price of one" set-up definitely has its benefits, because we can study, research and discuss issues before acting. Vacations, seminars, other out-of-office events are easier because there's always one of us here. This has worked well for us. Luckily, the two of us have an excellent working relationship and think alike in many ways. We've had to suffer through "twinkie" criticism on many occasions.

We are a state none-member bank of about $130 million. I am the compliance officer, loan review officer, and internal auditor. On the side I also am responsible for compliance training throughout the bank. I do have an assistant part time (she also runs the credit department). I have never heard the FDIC mention anything about segregation of any of these duties. I find it much easier to do all of those jobs by seeing and answering questions about many new loans that are a little out of the ordinary. Documentation both completeness and correctness are the keys. Definitely the internet has helped us all in the compliance arena to keep up with what is going on. I don't think if the bank's compliance program is pro-active that there would be any demands from the FDIC examiners. If you are actively finding those compliance problem areas and working for a solution that kind of self regulation is what the FDIC wants to see.