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2013 Annual Report

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Corporate Operating Budget

The FDIC segregates its corporate operating budget and expenses into two discrete components: ongoing operations and receivership funding. The receivership funding component represents expenses resulting from financial institution failures and is, therefore, largely driven by external forces, while the ongoing operations component accounts for all other operating expenses and tends to be more controllable and estimable. Corporate operating expenses totaled $2.3 billion in 2013, including $1.6 billion in ongoing operations and $0.7 billion in receivership funding. This represented approximately 91 percent of the approved budget for ongoing operations and 75 percent of the approved budget for receivership funding for the year.1

The Board of Directors approved a 2014 Corporate Operating Budget of approximately $2.4 billion, consisting of $1.8 billion for ongoing operations and $0.6 billion for receivership funding. The level of approved ongoing operations budget for 2014 is approximately $9 million (0.5 percent) higher than the 2013 ongoing operations budget, while the approved receivership funding budget is roughly $300 million (33 percent) lower than the 2013 receivership funding budget.

As in prior years, the 2014 budget was formulated primarily on the basis of an analysis of projected workload for each of the FDIC's three major business lines and its major program support functions. The most significant factor contributing to the decrease in the Corporate Operating Budget is the improving health of the industry and the resultant reduction in failure-related workload. Although savings in this area are being realized, the 2014 receivership funding budget allows for resources for contractor support as well as non-permanent staffing for DRR, the Legal Division, and other organizations, should workload in these areas require an immediate response.

1The numbers in this paragraph will not agree with the DIF and FRF financial statements due to differences in how items are classified.

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