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2005 Annual Report

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III. Performance Results Summary - Program Evaluation
During 2005, the FDIC completed evaluations of programs designed to achieve the strategic objectives set forth in the Supervision Program area of the FDIC's 2005-2010 Strategic Plan.

The program evaluation of each strategic objective included a list of issues to be evaluated, background context of the evaluation, analysis of programs and actions to achieve the objective, evaluation methodology, and findings. The following section highlights the issues evaluated and summarizes the results of this evaluation.

Strategic Objective FDIC-supervised institutions appropriately manage risk.
Issues evaluated
  • How does the FDIC ensure that FDIC-supervised institutions appropriately manage risk?
  • What happens to FDIC-supervised institutions that are not appropriately managing risk?
Findings The FDIC performs safety and soundness, trust, Bank Secrecy Act, and information technology examinations of FDIC-supervised institutions. The examinations are conducted to assess an institutionís overall financial condition, management practices and policies, and compliance with applicable laws and regulations. Through the examination process, the FDIC also assesses the adequacy of management and internal control systems to identify, measure and control risks. If the examination process reveals weaknesses in an FDIC-supervised institutionís operations or conditions, appropriate actions are taken. Informal or formal enforcement actions may be issued to the institutions that have significant weaknesses or that are operating in a deteriorated financial condition. The actions remain in effect until corrective actions are taken and the identified weaknesses are corrected. If the problems remain unresolved, the FDIC may take further steps to encourage or compel institutions to comply.
Strategic Objective Consumers have access to easily understood information about their rights and the disclosures due them under consumer protection and fair lending laws.
Issues evaluated
  • Does the FDIC provide information to consumers about their rights and the disclosures due consumers under current consumer protection and fair lending laws?
  • Is the information easily accessible and easily understood?
Findings The FDIC undertakes an extensive and expanding number of activities to provide information on consumersí rights and the disclosures due them under consumer protection and fair lending laws. A wide array of materials detail consumersí rights; provide information and answers to questions concerning deposit insurance, banks and consumer rights; and offer practical guidance on how to become a better informed user of financial services. These are readily accessible and widely distributed on the FDICís Web site and at outreach seminars and workshops. Many materials are also available in hard copy and some in multiple languages. The FDIC also has been actively involved in consumer education and disclosure with the on-going support of programs such as Money Smart and EDIE.
Strategic Objective FDIC-supervised institutions comply with consumer protection, Community Reinvestment Act (CRA), and fair lending laws.
Issues evaluated
  • How does the FDIC ensure that FDIC-supervised institutions comply with consumer protection, CRA, and fair lending laws?
Findings The FDIC conducts compliance and CRA examinations to evaluate FDIC-insured institutionsí practices regarding these areas. In addition to the examination process, the FDIC investigates consumer complaints about banking practices. Noncompliance with consumer protection and fair lending laws can result in civil liability and negative publicity as well as informal or formal enforcement actions against the institution to correct identified violations. The FDIC also utilizes the institutionsí record of compliance with consumer protection, CRA, and fair lending laws when evaluating applications for new or expanded activities and certain other corporate applications.





Last Updated 04/10/2006 communications@fdic.gov