I am pleased to present the Federal Deposit Insurance Corporationís (FDIC)
2004 Annual Report. During the past year, we continued to aggressively pursue
our three major priorities: promoting the stability of the nationís financial system,
developing and articulating sound policy positions, and meeting our stewardship obligations to the deposit insurance funds.
Meeting the FDICís mission is an increasingly complex responsibility, but the FDIC
made exceptional progress during 2004. I am proud of the dedication and hard
work of the FDICís employees over the past year.
I am pleased to highlight in this report some of our major accomplishments in
We worked to ensure that adequate capital standards would be maintained
in the new Basel Capital Accord.
We continued our efforts to reduce regulatory burden on financial institutions
as mandated by the Economic Growth and Regulatory Paperwork Reduction
Act of 1996 (EGRPRA). With other federal bank and thrift regulatory agencies,
we solicited and received over 700 comments on consumer protection
and deposit-related regulations, and we requested comment on proposed
changes to the FDICís Community Reinvestment Act regulations.
We aggressively refined our supervisory strategies consistent with changes
to the Bank Secrecy Act included in the USA PATRIOT Act. The FDIC, the
Department of Treasury's Financial Crimes Enforcement Network (FinCEN),
and the other federal banking agencies also entered into an information
sharing Memorandum of Understanding to enhance communication and
coordination to help financial institutions identify, detect and interdict terrorist
financing and money laundering.
We funded 17 research proposals to produce the first working papers to be
published by our new Center for Financial Research.
We reached approximately 300,000 consumers with our Money Smart financial
education program, resulting in the formation of over 40,000 new banking
relationships, and expanded our Money Smart program alliance to include five
Hispanic organizations. In addition, we released the Money Smart curriculum
in an interactive computer- based instruction format. The Money Smart
curriculum is a training program to help adults outside the financial mainstream
enhance their money- management skills and establish positive banking
We established a Resolutions Policy Committee to develop a comprehensive
strategy and action plan for handling a large - bank failure in the least costly
manner, maximizing net recoveries and minimizing any disruption.
We made significant progress toward the completion of a new Web-based
Central Data Repository (CDR) for Call Reporting and other regulatory reporting,
in cooperation with our Federal Financial Institutions Examination Council
(FFIEC) partners. Targeted for implementation in 2005, the CDR will employ
state-of-the-art technology and the XBRL (Extensible Business Reporting
Language) data standard. This system will further enhance the FDICís ability
to provide high-quality, timely data about the banking industry to regulators,
financial institutions and the public.
We continued to realign our workforce to meet future workload requirements.
The 2005 budget approved by the Board reflects a reduction of 674 authorized
positions over the next year.
A new Corporate Employee Program was announced that will allow us to
create a smaller, more flexible workforce in the future.
We initiated a two-year effort to improve our information technology (IT)
program by modernizing our IT infrastructure and applying an enterprise
architecture approach to guide future IT decision-making.
In accordance with the Reports Consolidation Act of 2000, the FDIC completed
an assessment of the reliability of the performance data contained in this report.
No material inadequacies were found and the data is considered to be complete
I am very proud of our achievements over the past year and look forward
to continued successes next year. The FDIC stands firm in its commitment
to promoting stability, pursuing sound policy and meeting our stewardship
responsibilities for the deposit insurance funds.
It is a privilege and an honor to serve as Chairman of the FDIC, and I look
forward to the many opportunities that lie ahead.