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2008 Annual Report



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III. Performance Results Summary

Performance Results by Program and Strategic Goal


2008 Insurance Program Results
Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.
# Annual Performance Goal Indicator Target Results
1 Respond promptly to all financial institution closings and emerging issues. Number of business days after an institution failure that depositors have access to insured funds either through transfer of deposits to the successor insured depository institution or depositor payout. Depositors have access to insured funds within one business day if the failure occurs on a Friday. Achieved.
Depositors have access to insured funds within two business days if the failure occurs on any other day of the week. Achieved.
Insured depositor losses resulting from a financial institution failure. There are no depositor losses on insured deposits. Achieved.
No appropriated funds are required to pay insured depositors. Achieved.
Enhancement of FDIC ­capabilities to make a deposit i­nsurance determination for a large-bank failure. Complete rulemaking on Large-Bank Deposit Insurance Determination Modernization. Achieved.
2 Identify and address risks to the Deposit Insurance Fund (DIF). Insurance risks posed by insured depository institutions. Assess the insurance risks in all insured depository institutions and adopt appropriate strategies. Achieved.
Concerns referred for examination or other action. Identify and follow up on all material issues raised through off-site review and analysis. Achieved.
Emerging risks to the DIF. Identify and analyze existing and emerging areas of risk, including non-traditional and subprime mortgage lending, declines in housing market values, mortgage-related derivatives/collateralized debt obligations (CDOs), hedge fund ownership of insured institutions, commercial real estate lending, international risk, and other financial innovations.

Achieved.

Achieved.

Address potential risks from cross-border banking instability through coordinated review of critical issues and, where appropriate, negotiate agreements with key authorities. Achieved.
3 Disseminate data and analyses on issues and risks affecting the financial services industry to bankers, supervisors, the public and other stakeholders. Scope and timeliness of information dissemination on identified or potential issues and risks. Disseminate results of research and analyses in a timely manner through regular publications, ad hoc reports and other means. Achieved.
Undertake industry outreach activities to inform bankers and other stakeholders about current trends, concerns and other available FDIC resources. Achieved.
4 Maintain and improve the deposit insurance system. Implementation of deposit insurance reform. Review the effectiveness of the new pricing regulations that were adopted to implement the reform legislation. Achieved.
Enhance the additional risk measures used to adjust assessment rates for large institutions. Achieved.
Develop a final rule on a permanent dividend system. Achieved.
Loss reserves. Ensure the effectiveness of the reserving methodology by applying sophisticated analytical techniques to review variances between projected losses and actual losses, and by adjusting the methodology accordingly. Achieved.
Fund adequacy. Set assessment rates to maintain the insurance fund reserve ratio between 1.15 and 1.50 percent of estimated insured deposits. Not Achieved.
5 Provide educational information to insured depository institutions and their customers to help them understand the rules for determining the amount of insurance coverage on deposit accounts. Timeliness of responses to insurance coverage inquiries. Respond to 90 percent of inquiries from consumers and bankers about FDIC deposit insurance coverage within time frames established by policy. Achieved.
Educational initiatives and outreach events for consumers and bankers. Conduct at least three sets of Deposit Insurance Seminar Series for bankers. Achieved.
Assess the feasibility of (and, if feasible, define the requirements for) a consolidated Electronic Deposit Insurance Estimator (EDIE) application for bankers and consumers (to be developed in 2009). Achieved.
Conduct outreach events and activities to support a deposit insurance education program that features FDIC 75th anniversary theme. Achieved.
6 Expand and strengthen the FDIC’s participaton and leadership role in providing technical guidance, training, consulting services and information to international governmental banking and deposit insurance organizations. Scope of information sharing and assistance available to international governmental bank regulatory and deposit insurance entities. Undertake outreach activities to inform and train foreign bank regulators and deposit insurers. Achieved.
Foster strong relationships with international banking regulators and associations that promote sound banking supervision and regulation, failure resolution and deposit insurance practices. Achieved.

 

2008 Supervision and Consumer Protection Program Results
Strategic Goal: FDIC-supervised institutions are safe and sound.
# Annual Performance Goal Indicator Target Results
1 Conduct on-site risk management examinations to assess the overall financial condition, management practices and policies, and compliance with applicable laws and regulations of FDIC-supervised depository institutions. Percentage of required examinations conducted in accordance with statutory requirements and FDIC policy. One hundred percent of required risk management examinations are conducted on schedule. Achieved.
2 Take prompt and effective supervisory action to address problems identified during the FDIC examination of FDIC-supervised institutions that receive a composite Uniform Financial Institutions Rating of “4” or “5” (problem institution). Monitor FDIC-supervised insured depository institutions’ compliance with formal and informal enforcement actions. Percentage of follow-up examinations of problem institutions conducted within required time frames. One hundred percent of follow-up examinations are conducted within 12 months of completion of the prior examination. Achieved.
3 Assist in protecting the infrastructure of the U.S. banking system against terrorist financing, money laundering and other financial crimes. Percentage of required examinations conducted in accordance with statutory requirements and FDIC policy. One hundred percent of required Bank Secrecy Act examinations are conducted on schedule. Achieved.
4 More closely align regulatory capital with risk in large or multinational banks while maintaining capital at prudential levels. Preliminary results of Basel II Parallel Run. Conduct analyses of early results of the new capital regime as information becomes available. Achieved.
Changes to Basel II Capital Framework. Develop options for refining Basel II that are responsive to lessons learned from the 2007-2008 market turmoil. Achieved.
5 More closely align regulatory capital with risk in banks not subject to Basel II capital rules while maintaining capital at prudential levels. Development of a revised capital framework proposal for institutions not subject to Basel II. Finalize a regulatory capital framework based on the Basel II “Standardized Approach” as an option for U.S. banks not required to use the new advanced approaches. Achieved.
6 Ensure that FDIC-supervised institutions that plan to operate under the new Basel II Capital Accord are well positioned to respond to new capital requirements. Percentage of on-site examinations or off-site analyses performed. Performed on-site examinations or off-site analyses of all FDIC-supervised banks that have indicated a possible intention to operate under Basel II to ensure that they are effectively working toward meeting required qualification standards. Not Applicable.
7 Reduce regulatory burden on the banking industry while maintaining appropriate consumer protection and safety and soundness safeguards. Completion of analysis of regulatory burden associated with the BSA/AML examination process. Complete and evaluate options for refining the current risk-focused approach used in the conduct of BSA/AML examinations to reduce the burden they impose on FDIC-supervised institutions. Achieved.
Strategic Goal: Consumers’ rights are protected and FDIC-supervised institutions invest in their communities.
8 Conduct CRA and compliance examinations in accordance with the FDIC’s examination frequency policy. Percentage of examinations conducted in accordance with required time frames. One hundred percent of required examinations are conducted within time frames established by FDIC policy. Achieved.
9 Take prompt and effective supervisory action to monitor and address problems identified during compliance examinations of FDIC-supervised institutions that receive a “4” or “5” rating for compliance with consumer protection and fair lending laws. Percentage of follow-up examinations or related activities conducted within required time frames. One hundred percent of follow-up examinations or related activities are conducted within 12 months from the date of a formal enforcement action to confirm that the institution is in compliance with the enforcement action. Achieved.
10 Determine the need for changes in current FDIC practices for following up on significant violations of consumer compliance laws and regulations identified during examinations of banks for compliance with ­consumer protection and fair lending laws. Implementation review of new practices instituted in 2007. Complete a review of the effectiveness of the 2007 instructions issued on the handling of repeat instances of significant violations identified during compliance examinations. Achieved.
11 Scrutinize evolving consumer products, analyze their current or potential impact on consumers and identify potentially harmful or illegal practices. Promptly institute a supervisory response program across FDIC-supervised institutions when such practices are identified. Establishment of supervisory response programs to address potential risks posed by new consumer products. Revise the FDIC’s system for identifying, reviewing and addressing potentially harmful or illegal practices associated with evolving consumer products. Achieved.
Develop and implement new supervisory response programs across all FDIC-supervised institutions to address potential risks posed by new consumer products. Achieved.
12 Effectively investigate and respond to consumer complaints about FDIC-supervised financial institutions. Timely responses to written complaints and inquiries. Responses are provided to 90 percent of written complaints and inquiries within time frames established by policy. Achieved.
13 Provide effective outreach related to CRA, fair lending, and community development. Number of outreach activities conducted, including technical assistance activities. Conduct 125 technical assistance (examination support) efforts or banker/community outreach activities related to CRA, fair lending, and community development. Achieved.
Expanded access to high quality financial education through the Money Smart curriculum. Release a “Young Adult” version of the Money Smart curriculum. Achieved.
Distribute at least 10,000 copies of the “Young Adult” version of Money Smart. Achieved.
Scope and timeliness of dissemination of the results of the unbanked survey. Analysis of survey results is disseminated within six months of completion of the survey through regular publications, ad hoc reports and other means. Achieved.
Support for expanded foreclosure prevention efforts for consumers at risk of foreclosure (in partnership with NeighborWorks® America and other organizations). Provide technical assistance, support and consumer outreach activities in all six FDIC regions to at least eight local NeighborWorks® America affiliates or local coalitions that are providing foreclosure mitigation counseling in high need areas. Achieved.
14 Continue to expand the FDIC’s national leadership role in development and implementation of programs and strategies to encourage and promote broader economic inclusion within the nation’s banking system. Results of pilot small-dollar lending program conducted by participating financial institutions. Analyze quarterly data submitted by participating institutions to identify early trends and potential best practices. Achieved.
Degree of success achieved in bringing the unbanked/underserved into the financial mainstream through the Alliance for Economic Inclusion. Open 27,000 new bank accounts. Achieved.
Initiate new small-dollar loan products in 32 financial institutions. Achieved.
Initiate remittance products in 32 financial institutions. Achieved.
Reach 18,000 consumers through financial education initiatives. Achieved.

 

2008 Receivership Management Program Results
Strategic Goal: Recovery to creditors of receiverships is achieved.
# Annual Performance Goal Indicator Target Results
1 Market failing institutions to all known qualified and interested potential bidders. Scope of qualified and interested bidders solicited. Contact all known qualified and interested bidders. Achieved.
2 Value, manage, and market assets of failed institutions and their subsidiaries in a timely manner to maximize net return. Percentage of failed institution’s assets marketed. Ninety percent of the book value of a failed institution’s marketable assets are marketed within 90 days of failure. Achieved.
3 Manage the receivership estate and its subsidiaries toward an orderly termination. Timely termination of new receiverships. Terminate all receiverships within 90 days of the resolution of all impediments. Achieved.
4 Conduct investigations into all potential professional liability claim areas for all failed insured depository institutions and decide as promptly as possible to close or pursue each claim, considering the size and complexity of the institution. Percentage of investigated claim areas for which a decision has been made to close or pursue the claim. For 80 percent of all claim areas, a decision is made to close or pursue claims within 18 months of the failure date. Achieved.



Last Updated 08/8/2009 communications@fdic.gov