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Budget Results

Last Updated: December 6, 2021
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III. Budget Results - Third Quarter 2021

Approved Budget Modifications

The 2021 Budget Resolution delegated to the Chief Financial Officer (CFO) and selected other officials the authority to make certain modifications to the 2021 FDIC Operating Budget. The CFO approved the following budget reallocations during the third quarter, in accordance with the authority delegated by the Board of Directors:

  • In July, the CFO approved the following adjustments to the Ongoing Operations budget:
    • An increase of $188,000 to the Outside Services – Personnel budget of DIT, allocated from the Corporate Unassigned Contingency reserve, to hire contractors to perform work previously performed by FDIC employees who departed under the Voluntary Separation Incentive Program (VSIP). This increase was fully offset by a reduction of two authorized permanent positions in DIT (see below).

    • A combined increase of $349,000 in the Equipment, Outside Services – Personnel, and Other budgets of OCOM, with corresponding budget decreases in DOA, to support the realignment of the Graphic Design and Printing Unit (GPDU) from DOA to OCOM.

Following these third quarter budget modifications, the balances in the Corporate Unassigned contingency reserve for the Ongoing Operations budget component declined from $7.2 million to $7 million (excluding the $40 million portion of the reserve set aside to address a potential increase in bank failure activity this year).  The balance in the Corporate Unassigned contingency reserve for the Receivership Funding budget component remained unchanged at $22.5 million (excluding the $100 million portion of the reserve set aside to address a potential increase in bank failure activity this year).

Approved Staffing Modificatons

The 2021 Budget Resolution delegated to the CFO the authority to modify approved 2021 staffing authorizations for divisions and offices, as long as those modifications do not increase the total approved 2021 FDIC Operating Budget. The CFO approved the following modifications to staffing authorizations during the second quarter, in accordance with the authority delegated by the Board of Directors:

  • In July, the CFO approved the following adjustments to 2021 staffing authorizations:
    • An increase of 18 authorized positions (16 permanent and two non-permanent) in various organizations in conjunction with the Mid-Year Budget Review:

      • Seven additional positions in RMS, including two permanent review examiners to address new Anti-Money Laundering (AML) statutory requirements, two permanent Information Management Assistants to address Section 508 compliance requirements, one permanent Applications Assistant in the Dallas Regional Office, and two non-permanent positions to address succession planning concerns in the San Francisco Region and provide temporary support for new AML policy updates.

      • Four new permanent positions in OMWI to support expanded workload requirements emanating from the new Diversity, Equity, and Inclusion Strategic Plan.

      • Four new permanent positions in the Office of Risk Management and Internal Controls to help address the Corporation’s substantially increased audit and internal controls workload.

      • Two new permanent positions in CISR, one dedicated examiner to support an increase in CISR’s supervisory portfolio and one new contract oversight specialist.

      • One permanent Information Management Assistant in DCP to address Section 508 compliance requirements

    • A reduction of 16 permanent positions, seven in DCP and nine in RMS, resulting from the joint RMS-DCP restructuring of regional office administrative support positions to better reflect current workload.

    • The transfer of 16 permanent positions from DOA to OCOM in conjunction with the realignment of the GDPU to OCOM.
  • In August, the CFO approved the following adjustments to 2021 staffing authorizations:

    • A reduction of six permanent positions in DIT (from 326 to 320) and an increase of four permanent positions in OCISO (from 48 to 52), consistent with the Chief Information Officer’s decision to realign vacancies resulting from the VSIP offer to address critical skill gaps.

    • An increase of 10 permanent positions in RMS to address new large bank examination staffing requirements that have emerged since the start of 2021 as a result of changes at two insured depository institutions.

Subsequent to these third quarter adjustments, authorized 2021 staffing for the Corporation totaled 5,844 positions (5,791 permanent and 53 non-permanent), a net increase of 10 positions.

Spending Variances

Significant spending variances by major expense category and division/office are discussed below. Significant spending variances for the quarter ending September 30, 2021 are defined as those that either (1) exceeded the YTD budget for a major expense category or division/office by more than $1 million and represented more than two 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 $7 million and represented more than seven 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 was $178 million, or 12 percent, below budget through the third quarter in 2021.  There were significant spending variances in four major expense categories:

  • Spending in the Outside Services – Personnel expense category was under budget by $44.5 million, or 18 percent. The most significant underspending occurred in the following divisions and offices:
    • The Division of Information Technology (DIT) underspent its Outside Services - Personnel budget in Ongoing Operations by $11.2 million, with $8.5 million attributable to underspending on IT Modernization initiatives. The underspending resulted largely from contractor staffing shortages and delays in project starts and the setup of the cloud environment.

    • FDITECH underspent its budget by $7.2 million because of delays in awarding planned contracts and the decision not to use contractors to conduct Tech Sprints.

    • The Division of Administration (DOA) underspent its Outside Services-Personnel category by $8.0 million, including $2.8 million in underspending on recurring services resulting primarily from pandemic-related service reductions, $2.9 million attributable to delays in human resources initiatives, and $2.3 million due to underspending on other recurring and non-recurring contractual services.

    • The Division of Complex Financial Institution Supervision and Resolution (CISR) underspent its Outside Services – Personnel budget by $4.2 million due to delays in contracting for budgeted advisory services for human resource management (compensation playbooks) and strategic communications (playbook framework), and Institution Analysis.

    • The Legal Division underspent its budget by $3.2 million due to delays in rulings on pending litigation.  One major case has been dormant while the Magistrate recovered from COVID-19 and completed his involvement in other cases.

    • The Legal Division underspent its budget by $3.2 million due to delays in rulings on pending litigation.  One major case has been dormant while the Magistrate recovered from COVID-19 and completed his involvement in other cases.

  • Spending in the Travel expense category was under budget by $24.4 million, or 86 percent, primarily due to substantially reduced travel by employees in the Divisions of Risk Management Supervision (RMS), Depositor and Consumer Protection (DCP) due to the continuation of pandemic-related FDIC travel restrictions.
  • Spending in the Buildings and Leased Space expense category was under budget by $18.1 million, or 22 percent.  The underspending was attributable primarily to delays in DOA in the design and execution of large planned construction projects, lower-than-budgeted leasing expenses resulting from reductions in leased space, reduced spending due to pandemic-related service reductions, and lower-than-budgeted spending on moving support services and small facilities improvements.
  • Spending in the Equipment expense category was under budget by $14.5 million, or 15 percent.  This was mostly attributable to delays in hardware refresh purchases by DIT and reductions in digital library subscriptions and furniture purchases by DOA during mandatory telework.

Receivership Funding

The Receivership Funding budget component 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 incurred to ensure readiness without regard to whether failures occur.

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

Office of Inspector General

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

Significant Spending Variances by Division/Office 1

There were eight organizations with significant spending variances through the end of the third quarter:

  • RMS spent $51 million, or 12 percent, less than its YTD budget. This variance was primarily attributable to underspending of $27 million in the Travel expense category due to pandemic-related travel restrictions and $20 million in the Salaries and Compensation expense category due to vacancies in budgeted positions.
  • DOA spent $49 million, or 20 percent, less than its YTD budget.  In the Investment budget, the Training Center Modernization project spent $12.3 million less than budgeted, largely because of construction efficiencies realized because the Training Center was unoccupied during mandatory telework.  In the Ongoing Operations budget, underspending for Buildings & Leased Space totaled $18.0 million due to delays in the design and execution of large planned construction projects, lower-than-budgeted leasing expenses resulting from reductions in leased space, and lower-than-budgeted spending on moving support services and small facilities improvements; underspending for Outside Services-Personnel totaled $8.0 million due to pandemic-related service reductions; underspending for Equipment totaled $2.9 million due to reduced digital library subscriptions and furniture purchases; and underspending for Salaries and Compensation budget totaled $5.9 million due to vacancies in budgeted positions.
  • DIT spent $23 million, or 8 percent, less than its YTD budget.  Underspending for Outside Services Personnel totaled $11.2 million, of which $8.5M reflected underspending on IT Modernization initiatives (see above).  Additionally, DIT underspent its Equipment budget by $9.8 million due to delays in executing planned purchases or receiving purchased goods, including $9 million for equipment that has been ordered but not yet received.  This supply chain issue is expected to continue through the end of the year and possibly into 2022.
  • DCP spent $13 million, or 9 percent, less than its YTD budget.  About $5 million of this amount was attributable to underspending for Salaries and Compensation due to unfilled vacancies, and $7 million was attributable to reduced expenses for exam, training, and relocation travel during mandatory telework.
  • CISR spent $12 million, or 16 percent, less than its YTD budget.  Of this amount, $6 million reflected underspending for Salaries and Compensation due to vacancies in authorized positions, and $4 million reflected underspending for Outside Services–Personnel due to delays in contracting for advisory services for human resources management, strategic communications, and Institution Analysis.
  • DRR spent $11 million, or 11 percent, less than its YTD budget. The variance in DRR was primarily attributable to underspending in the Outside Services-Personnel expense category in both the Ongoing Operations and Receivership Funding budget components.  In the Ongoing Operations component, the variance was due to delays in awarding several contracts for advisory services and lower-than-estimated expenses for the Shared Loss Liability Estimation model update and security testing for the Resolution Transaction Submission Portal.  In the Receivership Funding component, the variance was due to lower-than-budgeted bank failure activity, which reduced spending for pre-closing and post-closing activities, accounting and tax services, and asset marketing and management.
  • The Legal Division spent $11 million, or 9 percent, less than its YTD budget.  This underspending was attributable primarily to the large number of vacancies in budgeted 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.