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Budget Results

Last Updated: September 27, 2022

III. Budget Results - Second Quarter 2022

Spending Variances

Significant spending variances by major expense category and division/office are discussed below. Significant spending variances for the quarter ending June 30, 2022 are defined as those that either (1) exceeded the YTD budget for a major expense category or division/office by more than $2 million and represented more than three percent of the major expense category or total division/office budget; or (2) were under the YTD budget for a major expense category or division/office by more than $10 million and represented more than 10 percent of the major expense category or total division/office budget.

Significant Spending Variances by Major Expense Category

Ongoing Operations

Overall spending for the Ongoing Operations budget component totaled $110.7 million, or 11 percent, below budget through the second quarter in 2022.  There were significant spending variances in three expense categories: 

  • Travel spending was under budget by $22.4 million, or 83 percent, due to underspending in all organizations as the result of continuing pandemic-related travel restrictions.  The Travel budget was based on an assumption that the FDIC would return to normal travel beginning in the second quarter of 2022.
  • Outside Services – Personnel spending was under budget by $18.7 million, or 12 percent. The variance was largely attributable to underspending in the following divisions and offices:
    • The Division of Information Technology (DIT) underspent its YTD budget by $6.1 million, consisting of $3.8 million in its budget for continuing operations and $2.3 million in its budget for one-time initiatives.  The underspending for continuing operations reflected delayed spending that DIT expects to spend later this year for infrastructure support services. The underspending for one-time initiatives primarily reflected delayed project starts for new projects.
    • The Division of Administration (DOA) underspent its YTD budget by $3.0 million largely due to reduced spending on crisis readiness support and reduced expenses for security and other on-site support services during mandatory telework.  
    • The Legal Division underspent its YTD budget by $2.1 million due mostly to lower-than–projected expenses for litigation that resulted from delays in court proceedings that were outside of the FDIC’s control.
    • The Division of Complex Institution Supervision and Resolution (CISR) underspent its YTD budget by $1.9 million due primarily to delays in awarding contracts for human resources management, franchise marketing support, and communications advisory services.
    • The Division of Resolutions and Receiverships (DRR) underspent its YTD budget by $1.5 million due to delays in awarding contracts for advisory services, IT security and privacy support, and an asset and portfolio management platform.  Delays were also encountered in completing security reviews required to obtain from the Chief Information Officer a required Authority to Operate (ATO) for contracts for crypto asset assistance, an ORE oil and gas auctioneering platform, and imaging and indexing vendors.
    • Corporate University (CU) underspent its YTD budget by about $800,000 as the result of lower-than-anticipated expenses for required training for contracting officers, decreased demand for executive coaching services and leadership core training assessments, and lower-than-budgeted expenses for the development of virtual instructor-led training, Instructional Systems Design (ISD) services, and IT examination training delivery.
    • The Division of Insurance and Research (DIR) underspent its YTD budget by approximately $700,000, primarily attributable to underspending by the Center for Financial Research (CFR) for its failed bank research environment due to supply chain issues and pandemic-related delays in survey-related activities. 
  • Spending in the Buildings and Leased Space expense category was under budget by $14.4 million, or 20 percent, primarily due to delays in and deferrals of capital improvement projects, reduced leasing costs, and savings on facilities-related service contracts in DOA.

Receivership Funding

The Receivership Funding component of the 2022 FDIC Operating Budget includes funding for expenses that are incurred in conjunction with institution failures and the management and disposition of the assets and liabilities of the ensuing receiverships, except for salary and benefits expenses for permanent employees assigned to the receivership management function and other expenses required to ensure readiness without regard to whether failures occur. 

There were no significant spending variances through the second quarter in the Receivership Funding budget component.

Office of Inspector General

There were no significant spending variances through the second quarter of the 2022 Office of Inspector General (OIG) budget component.  

Significant Spending Variances by Division/Office1

There were four organizations with significant spending variances through the end of second quarter:

  • Division of Risk Management Supervision (RMS) underspent its YTD budget by $31.4 million, or 11 percent, primarily due to underspending of $16.1 million in its Salaries and Compensation budget resulting from higher-than-projected vacancies in budgeted positions (particularly in its examination workforce) and $14.5 million in its Travel budget resulting from continuing pandemic-related travel restrictions.
  • DOA underspent its YTD budget by $23.5 million, or 14 percent, primarily due to underspending of $14.3 million in the Buildings and Leased Space expense category for the reasons stated above, $4.2 million in the Salaries and Compensation expense category was due to vacancies in budgeted positions, and $3.0 million in the Outside Services-Personnel expense category due to reduced spending for crisis readiness support and security and other on-site support services.
  • Division of Depositor and Consumer Protection underspent its YTD budget by $13.0 million, or 14 percent, primarily due to underspending of $7.6 million in the Salaries and Compensation expense category due to unfilled vacancies in budgeted positions and $4.6 million in the Travel expense category resulting from continuing pandemic-related travel restrictions.
  • DRR underspent its YTD budget by $11.1 million, or 17 percent, including $5.2 million in its Ongoing Operations budget and $5.9 million in its Receivership Funding budget. The underspending in the Ongoing Operations budget component included $2.8 million in the Salaries and Compensation expense category due to vacancies in budgeted positions, $1.5 million in the Outside Services-Personnel expense category due to delays in awarding several contracts and starting various projects; and $648,000 in the Travel expense category due to the pandemic related travel restrictions. The underspending in the Receivership Funding budget component included $5.0 million in the Outside Services-Personnel expense category, $500,000 in the Other Expenses category, and $129,000 in the Travel expense category, all due to lower–than-budgeted bank failure activity.

Approved Budget Modifications

The 2022 Budget Resolution delegated to the Chief Financial Officer (CFO) and selected other officials the authority to make certain modifications to the 2022 FDIC Operating Budget. The following budget reallocations were approved during the second quarter by the CFO, in accordance with the authority delegated by the Board of Directors:

  • In conjunction with a periodic review by the Division of Finance (DOF), adjustments were made to align the Salaries and Compensation budgets of individual divisions and offices with their projected salaries and benefits expenses. These adjustments resulted in no net change to the Salaries and Compensation budget at the corporate level, as increases for individual divisions and offices with shortfalls were fully offset by reductions to division and office budgets with excess budget authority.

  • In June, following a corporate-wide mid-year budget review, the CFO approved adjustments to the 2022 Ongoing Operations budgets of multiple divisions and offices. A total of $7.8 million in increases and $19.5 million in decreases was approved to the Ongoing Operations budgets of selected divisions and offices. The resulting net budget surplus of $11.7 million was added to the Corporate Unassigned contingency reserve for that budget component. Approved mid-year adjustments included the following:

    • An increase of $5.2 million to the Outside Services–Personnel budget of the Office of the Chief Information Security Officer (OCISO), including $1.3 million for the ongoing support of the Information Systems Security Officer program; $2.1 million to provide additional funding for security reviews required in connection with the issuance of Authorities-to-Operate by the Chief Information Officer; $750,000 to provide funding for the transition to new contracts for some functions; $577,000 to implement a new security incident management system; and $448,000 to begin planning for the Continuous Diagnostics and Mitigation initiative.

    • An increase of $1.6 million to the Equipment budget of DIT, primarily to cover expenses incurred in 2022 for the delayed delivery of equipment ordered in 2021 as the result of supply chain issues. This increase was partially offset by a decrease of $127,000 in DIT’s Outside Services–Personnel budget related to the transfer of responsibility for the Tax Reporting Services Contract from DIT to DOF.

    • A net increase of $989,000 in the Outside Services–Personnel budget of the Office of Communications (OCOM) in conjunction with assumption of responsibility from the FDIC Tech Lab (FDITECH) for the Web Content Management System project. The increase for that project was partially offset by cost savings realized from the re-competition of the daily news briefing service. Small increases were also approved in OCOM’s Travel budget to support increased travel in conjunction with heightened video production workload and in its Equipment budget to support the purchase of video production equipment.

    • An increase of $127,000 in the Outside Services-Personnel budget of DOF to support the transfer of responsibility for the Tax Reporting Services Contract from DIT to DOF.

    • A decrease of $9.6 million in the FDITECH budget to reflect significant delays in the start dates for several projects, transfer of responsibility for the Web Content Management project to OCOM, and the discontinuation of the planned use of detailees from outside the FDIC.

    • A net decrease of $9.2 million in the budget of DOA. This was largely the result of an $11.3 million reduction in the Buildings and Leased Space budget due to significant delays or deferrals of planned construction projects and reduced costs for building support services. That reduction was partially offset by increases of approximately $1.0 million in DOA’s Outside Services–Personnel budget to support human resources initiatives; $889,000 in the Equipment budget to support the acquisition of new online information services subscriptions; $112,000 in the Other Expenses budget to support the purchase of facilities-related supplies and reimbursement of COVID-19 testing expenses for unvaccinated employees; and $55,000 in the Salaries and Compensation budget for overtime in connection with implementation of the new acquisition management system.

    • Decreases of $200,000 in the Outside Services–Personnel budget and $212,000 in the Outside Services–Other budget of the Legal Division due to the deferral of budgeted projects to 2023.

    • A decrease of $283,000 in RMS’s Outside Services–Personnel budget related to lower-than-projected expenses for bank scanning services and the transition of the Technical Evaluation contract to a new vendor.

    • An increase of $7,000 in the Other Expenses budget of the Office of the Ombudsman to cover conference registration fees.

Following these second quarter budget modifications, the balances in the Corporate Unassigned contingency reserve for the Ongoing Operations budget component increased from $25 million to $36.7 million, and the balance in the Corporate Unassigned contingency reserve for the Receivership Funding budget component remained unchanged at $21.2 million.

Approved Staffing Modifications

The 2022 Budget Resolution delegated to the CFO the authority to modify approved 2022 staffing authorizations for divisions and offices, as long as those modifications did not increase the total approved 2022 FDIC Operating Budget.

  • In April, the CFO approved an increase of four positions, as follows:

    • An increase of one permanent Administrative Law Judge position in the Office of Financial Institution Adjudication in recognition of the expected continuation of a higher-than-anticipated adjudicatory workload. As a result, OFIA’s total 2022 staffing authorization increased from two to three.

    • An increase of two permanent positions in Office of Risk Management and Internal Controls (ORMIC) to address increased workload increases and succession management concerns. As a result, ORMIC’s 2022 staffing authorization increased from 27 to 29 positions.

    • An increase of one non-permanent position in RMS in order to ensure an appropriate span of control in one RMS field territory. As a result, RMS’s 2022 staffing authorization increased from 2,433 to 2,434 positions.

  • In May, the CFO approved an increase of nine authorized permanent positions and a decrease of two authorized non-permanent positions in DOA. The new permanent positions include five positions to support supervisory-managerial and program development needs in the Human Resources Branch; two positions to strengthen internal controls and contract management functions; and two positions to support projected long-term workload for the new Crisis Readiness and Response Program. The latter two positions replaced the two previously-authorized non-permanent positions supporting that program. As a result, total authorized positions in DOA increased from 399 (396 permanent and three non-permanent) to 406 (405 permanent and one non-permanent) positions.
Subsequent to these second quarter adjustments, authorized 2022 staffing for the Corporation totaled 5,927 (5,870 permanent and 57 non-permanent), a net increase of 11 positions.

1Information on division/office variances reflects variances in the FDIC Operating Budget and does not include variances related to approved multi-year investment projects.