Summary of 2009 Performance Results by Program
The FDIC successfully achieved 45 of the 46 annual performance targets established in its 2009 Annual Performance Plan. The one goal that was not achieved involved the inadvertent inclusion of "3-rated" institutions in the requirement for follow-up within 12 months. There were no instances in which 2009 performance had a material adverse effect on successful achievement of the FDIC's mission or its strategic goals and objectives regarding its major program responsibilities.
Key accomplishments by program are highlighted in the table below.
Uniformly raised deposit insurance assessment rates effective January 1, 2009, by 7 basis points.
In February 2009, extended the Restoration Plan to 7 years due to the extraordinary circumstances facing the banking industry. In May, Congress revised the law to require the reserve ratio to be restored to 1.15 percent within 8 years absent extraordinary circumstances. In September, the Board amended the amended Plan to extend the restoration period to 8 years.
Finalized improvements to the risk-based pricing system, including adding various financial ratios to the large bank method used to determine premium rates for large institutions and adjusting all institutions' premium rates for unsecured debt and for significant reliance on brokered deposits or secured liabilities. Also widened the range of rates paid by institutions in each risk category.
Imposed a special assessment of 5 basis points on each institution's assets less Tier I capital effective June 30, 2009.
Extended period to issue guaranteed debt through the TLGP to October 31, 2009, extended term of guarantee from June 30, 2012, to December 31, 2012, and imposed surcharges on any debt issued April 1, 2009, or later.
Issued a final rule extending the Transaction Account Guarantee Program component of the TLGP from December 31, 2009, to December 31, 2010, and gave participating institutions a one-time opportunity to opt out. Raised fees and made them risk-based depending upon an institution's deposit insurance risk category.
Conducted semiannual reviews of the Contingent Loss Reserve (CLR) methodology through an analysis of the variance between projected and actual losses. As a result, substantive changes were made during late 2008 and into 2009 to improve the accuracy of the CLR calculation.
Established a Designated Reserve Ratio of 1.25 percent for 2010, in accordance with the provisions of the deposit insurance reform legislation.
Researched and analyzed emerging risks and trends in the banking sector, financial markets, and the overall economy to identify issues affecting the banking industry and the Deposit Insurance Fund.
Provided policy research and analysis in support of legislative efforts to reform financial industry regulation, as well as support for testimony and speeches.
Published economic and banking information and analyses, through the FDIC Quarterly, FDIC Quarterly Banking Profile (QBP), FDIC State Profiles, and the Center for Financial Research Working Papers.
Conducted numerous outreach activities to bankers, trade groups, community groups, other regulators, and foreign visitors addressing economic and banking risk analysis.
Completed risk assessments and LIDI Scorecards for all large insured depository institutions and followed up on all identified concerns through off-site review and analysis.
Increased on-site presence at large complex institutions to assess risk, monitor liquidity, and participate in targeted reviews with the primary federal regulators.
Continued to develop the Legacy Loans Program to be prepared to offer this program to support the credit needs of the economy.
Answered 99 percent of inquiries from consumers and bankers about FDIC deposit insurance coverage within 14 days.
Continued and expanded the FDIC's public education campaign to increase awareness of FDIC deposit insurance coverage.
Conducted 25 deposit insurance seminars for bankers, including 6 national teleconferences, on FDIC deposit insurance coverage. These seminars reached more than 35,000 bankers.
Worked with several national consumer organizations to secure commitments to feature FDIC deposit insurance information on their websites and in newsletters, and to disseminate such information at their conferences and events.
Electronic Deposit Insurance Estimator user sessions for 2009 totaled 699,277.
Expanded avenues for publicizing deposit insurance rules and resources by:
Enhancing the FDIC's Electronic Deposit Insurance Estimator (EDIE) to incorporate new functionality that allows users to (1) confirm whether their bank is FDIC-insured while within the EDIE application, and (2) calculate insurance coverage for deposits held by revocable trusts with more than five beneficiaries/over $1.25 million at one institution.
Producing updated versions of two videos on deposit insurance coverage: (1) a 30-minute video for consumers and new bank employees and (2) a 95-minute seminar for bankers who answer coverage questions for depositors.
Producing two consumer brochures on deposit insurance coverage.
These resources are available in multiple languages. The videos are available on the FDIC's web site and YouTube channel, and are downloadable for multi-media applications.
Supervision and Consumer Protection
Conducted 2,604 risk management (safety and soundness) examinations, including required follow-up examinations of problem institutions, within prescribed time frames.
Conducted 1,981 compliance and Community Reinvestment Act examinations, including required follow-up examinations of problem institutions, within prescribed time frames.
Conducted 2,698 Bank Secrecy Act examinations, including required follow-up examinations and visitations.
Conducted 2,780 IT examinations of financial institutions and technology service providers.
Worked with other federal banking regulators and the Basel Committee on Banking Supervision to develop proposals to strengthen capital and liquidity requirements.
Published a final rule amending the annual audit, audit committee, and related reporting requirements applicable to insured depository institutions with $500 million or more in total assets.
Published Notice of Proposed Rulemaking for the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 and posted the draft final guidance to the FDIC web site to implement provisions applicable to mortgage loan originators employed by insured depositories. Staff continued rule writing and other preparatory activities related to implementing these new regulations.
Published the Supervisory Insights journal to contribute to and promote sound principles and best practices for bank supervision.
Among other releases, issued Financial Institution Letters (FILs) providing guidance on: (1) managing commercial real estate concentrations; (2) liquidity risk management; (3) the use of volatile funding sources by financial institutions in weakened condition; (4) enhanced supervisory procedures for newly insured FDIC-supervised depository institutions; and (5) reminding institutions that if, for risk management purposes, they decide to reduce or suspend home equity lines of credit, they must comply with certain legal requirements. In addition, six disaster-related FILs were issued.
Issued industry notification of two interagency releases regarding conducting Cross-Border Funds Transfers and Examination Procedures for compliance with the Unlawful Internet Gambling Enforcement Act.
Issued updated interagency guidance on the Community Reinvestment Act (CRA), and requested comment on new proposed guidance. Issued an interagency proposal to amend the CRA regulation to implement statutory requirements relating to student loans and activities in cooperation with minority- and women-owned financial institutions and low-income credit unions.
Released interagency guidance on the 2009 Identity Theft Red Flags regulations; issued updated guidance on flood insurance mandatory purchase requirements and requested comment on additional proposed guidance; joined seven other federal agencies in releasing a model privacy notice form based on extensive consumer testing; requested comment on supervisory guidance on reverse mortgages.
Consumer research function supported supervision activities on fair lending, enforcement actions, the unbanked and underbanked survey, and supported efforts of the Advisory Committee on Economic Inclusion (ComEIn) policy initiatives of the Corporation.
Alerted banks to new statutory requirements to protect tenants occupying foreclosed properties; issued three FILs notifying institutions of significant changes to the Truth in Lending Act and the Federal Reserve Board's Regulation Z (which implements that Act); and reminded institutions of the dramatically revised Real Estate Settlement Procedures Act regulation issued by the Department of Housing and Urban Development.
Expanded the AEI initiative to two additional markets, bringing the total number of active AEI markets to 14. Additionally, FDIC worked closely during 2009 to provide technical assistance and support to several communities in forming coalitions patterned after the AEI.
Hosted or co-hosted over 104 events to help consumers and the banking industry avoid unnecessary foreclosures and stop foreclosure "rescue" scams that promise false hope to consumers at risk of losing their homes.
Conducted over 200 outreach and technical assistance events for bankers and community groups to promote awareness of community investment opportunities, access to capital, knowledge-sharing between the public and private sectors, and wealth-building opportunities for families.
Continued to disseminate the award-winning Money Smart financial education curriculum in seven languages, including releasing a Hmong language version and the Money Smart Podcast Network, a portable audio version of Money Smart suitable for use with virtually all MP3 players. Over 200 financial education-related outreach activities were conducted in 2009 and 50 new Money Smart Alliance added. Financial education best practices were shared through four published editions of Money Smart News, which reached over 40,000 subscribers.
In 2007, the FDIC released findings from a longitudinal evaluation of the Money Smart curriculum on adults. The FDIC initiated in the fourth quarter of 2009, a multi-year project that is designed to measure the effectiveness of the Money Smart for Young Adults curriculum. This survey project is intended to provide research data that will be useful for educators and others involved in youth financial education, as well as inform the FDIC's curriculum development efforts. Progress during 2009 included background research and outreach to external stakeholders who we hope will participate.
Responded to 96 percent of consumer complaints about FDIC-supervised banks within time frames required by policy, and acknowledged 100 percent of all consumer complaints and inquiries within 14 days.
Implemented an initiative to make the award-winning FDIC Consumer News available to the public in an audio format on FDIC.gov and YouTube. Also converted the FDIC's consumer video on identity theft, Don't Be An On-line Victim, to a YouTube-compatible format and placed the video on the FDIC's YouTube channel. All video and audio files are available for download to multimedia applications in various formats including MP3, WAV, and MP4.
Successfully closed 140 failed institutions and ensured customers had access to insured deposits within one business day.
Adopted a final rule requiring the largest insured depository institutions to adopt mechanisms that would, in the event of the institution's failure: (1) provide the FDIC with standard deposit account and other customer information; and (2) allow the placement and release of holds on liability accounts, including deposits.
Achieved a primary goal of the Investigations Unit to make a decision to either close or to pursue professional liability claims on 80 percent of all investigative claim areas within 18 months of an institution's failure date.
Identified and implemented program improvements to ensure efficient and effective management of the contract resources used to perform receivership management functions.
Marketed at least 90 percent of the book value of a failed institution's marketable assets within 90 days of the institution's failure.
Terminated at least 75 percent of new receiverships within three years of the date of failure.