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2010 Annual Report

III. Performance Results Summary

Prior Years’ Performance Results

Refer to the respective full Annual Report of prior years for more information on performance results for those years. Minor wording changes may have been made to reflect current goals and targets. (Shaded areas indicate no such target existed for that respective year.)

Insurance Program Results

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

Annual Performance Goals and Targets 2009 2008 2007
1. Respond promptly to all financial institution closings and emerging issues.  
Depositors have access to insured funds within one business day if the failure occurs on a Friday. Achieved. Achieved. Achieved.
Depositors have access to insured funds within two business days if the failure occurs on any other day of the week. Achieved. Achieved. Achieved.
Complete rulemaking/review comments received in response to the Advance Notice of Proposed Rulemaking on Large-Bank Deposit Insurance Determination Modernization.   Achieved. Achieved.
There are no depositor losses on insured deposits. Achieved. Achieved.  
No appropriated funds are required to pay insured depositors. Achieved. Achieved.  
2. Identify and address risks to the Deposit Insurance Fund (DIF).  
Assess the insurance risks in large (all for 2008-2009) insured depository institutions and adopt appropriate strategies. Achieved. Achieved. Achieved.
Identify and follow up on all material issues raised through off-site review and analysis. Achieved. Achieved. Achieved.
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. Achieved.
Address potential risks from cross-border banking instability through coordinated review of critical issues and, where appropriate, negotiate agreements with key authorities.   Achieved. Achieved.
3. Disseminate data and analyses on issues and risks affecting the financial services industry to bankers, supervisors, the public, and other stakeholders.  
Disseminate results of research and analyses in a timely manner through regular publications, ad hoc reports, and other means. Achieved. Achieved. Achieved.
Industry outreach activities are undertaken to inform bankers and other stakeholders about current trends, concerns, and other available FDIC resources. Achieved. Achieved. Achieved.
4. Effectively administer temporary financial stability programs.  
Provide liquidity to the banking system by guaranteeing noninterest-bearing transaction deposit account and new senior unsecured debt issued by eligible institutions under the TLGP. Achieved.    
Implement an orderly phase-out of new guarantees under the program when the period for issuance of new debt expires. Achieved.    
Substantially complete by September 30, 2009, the review of and recommendations to the Department of Treasury on CPP applications from FDIC-supervised institutions. Achieved.    
Expeditiously implement procedures for the LLP, including the guarantee to be provided for debt issued by Public Private Investment Funds, and provide information to financial institutions and private investors potentially interested in participating. Achieved.    
Expeditiously implement procedures to review the use of CPP funds, TLGP guarantees, and other resources made available under financial stability programs during examinations of participating FDIC-supervised institutions. Achieved.    
5. Maintain and improve the deposit insurance system.  
Adopt and implement revisions to the pricing regulations that provide for greater risk differentiation among insured depository institutions reflecting both the probability of default and loss in the event of default. Achieved.    
Revise the guidelines and enhance the additional risk measures used to adjust assessment rates for large institutions. Achieved.    
Implement the new deposit insurance pricing system.     Achieved.
Review the effectiveness of the new pricing regulations that were adopted to implement the reform legislation.   Achieved.  
Complete and issue guidance on the pricing of deposit insurance for large banks.     Achieved.
Enhance the additional risk measures used to adjust assessment rates for large institutions.   Achieved.  
Publish an ANPR seeking comment on a permanent dividend system.     Achieved.
Develop a final rule on a permanent dividend system.   Achieved.  
Ensure/enhance 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. Achieved. Achieved.
Set assessment rates to maintain the insurance fund reserve ratio between 1.15 and 1.50 percent of estimated insured deposits. Restore to 1.15 percent by year-end 2015. Achieved. Not Achieved. Achieved.
Monitor progress in achieving the restoration plan. Achieved.    
6. 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.  
Publish a comprehensive and authoritative resource guide for bankers, attorneys, financial advisors and similar professionals on the FDIC’s rules and requirements for deposit insurance coverage of revocable and irrevocable trust accounts.     Achieved.
Conduct at least three sets of Deposit Insurance Seminar/teleconferences (per quarter in 2009) for bankers. Achieved. Achieved.  
Conduct a series of national teleconferences for insured financial institutions to address current questions and issues relating to FDIC insurance coverage of deposit accounts.     Achieved.
Conduct outreach events and activities to support a deposit insurance education program that features the FDIC 75th anniversary theme.   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.  
Respond to 90 percent of inquiries from consumers and bankers about FDIC deposit insurance coverage within time frames established by policy.   Achieved. Achieved.
Respond to 90 percent of written inquiries from consumers and bankers about FDIC deposit insurance coverage within two weeks. Achieved.    
Enter into deposit insurance education partnerships with consumer organizations to educate consumers. Achieved.    
Expand avenues for publicizing deposits insurance rules and resources to consumers through a variety of media. Achieved.    
7. Expand and strengthen the FDIC’s participation and leadership role in providing technical guidance, training, consulting services, and information to international governmental banking and deposit insurance organizations.  
Undertake outreach activities to inform and train foreign bank regulators and deposit insurers. Achieved. Achieved. Achieved.
Foster strong relationships with international banking regulators and associations that promote sound banking supervision and regulations, failure resolution and deposit insurance practices. Achieved. Achieved. Achieved.

Supervision and Consumer Protection Program Results

Strategic Goal: FDIC-supervised institutions are safe and sound.

Annual Performance Goals and Targets 2009 2008 2007
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.  
One hundred percent of required risk management examinations are conducted on schedule. Achieved. Achieved. 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.  
One hundred percent of follow-up examinations are conducted within 12 months of completion of the prior examination. Achieved. Achieved. Achieved.
3. Assist in protecting the infrastructure of the U.S. banking system against terrorist financing, money laundering and other financial crimes.  
One hundred percent of required Bank Secrecy Act (BSA) examinations are conducted on schedule. Achieved. Achieved.  
4. Increase regulatory knowledge to keep abreast of current issues related to money laundering and terrorist financing.  
An additional 10 percent of BSA/AML subject-matter experts nationwide are certified under the Association of Certified Anti-Money Laundering Specialists certification program.     Achieved.
5. More closely align regulatory capital with risk in large or multinational banks while maintaining capital at prudential levels.  
Develop options for refining Basel II that are responsive to lessons learned from the 2007-2008 market turmoil.   Achieved.  
Further develop the Basel II framework to ensure that it does not result in a substantial reduction in risk-based capital requirements or significant competitive inequities among different classes of banks. Consider alternative approaches for implementing the Basel Capital Accord.     Achieved.
Conduct analyses of early results of the performance of new capital rules in light of recent financial turmoil as information becomes available. Achieved. Achieved.  
Working domestically and internationally, develop improvements to regulatory capital requirements based on the experience of the recent financial market turmoil. Achieved.    
Promote international cooperation on the adoption of supplemental capital measures in countries that will be operating under Basel II.     Achieved.
Participate in the continuing analysis of the projected results of the new capital regime.     Achieved.
6. More closely align regulatory capital with risk in banks not subject to Basel II capital rules while maintaining capital at prudential levels.  
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.  
Complete rulemaking on Basel IA.     Not Applicable.
7. Ensure that FDIC-supervised institutions that plan to operate under the new Basel II Capital Accord are well positioned to respond to the new capital requirements.  
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. Achieved.
8. Reduce regulatory burden on the banking industry while maintaining appropriate consumer protection and safety and soundness safeguards.  
Complete and evaluate options for refining the current risk-focused approach used in the conduct of BSA/AML examinations to reduce the burden theyimpose on FDIC-supervised institutions.   Achieved.  
Applicable provisions of the Financial Services Regulatory Relief Act of 2006 (FSRRA) are implemented in accordance with statutory requirements.     Partially Achieved.
Support is provided to the Government Accountability Office (GAO), as requested, for studies required under FSRRA.     Achieved.
State AML assessments of Money Service Businesses (MSB) are incorporated into FDIC risk management examinations in states where MSB AML regulatory programs are consistent with FDIC risk management standards.     Partially Achieved.

Strategic Goal: Consumers’ rights are protected and FDIC-supervised institutions invest in their communities.

1. Conduct CRA and compliance examinations in accordance with the FDIC’s examination frequency policy.  
One hundred percent of required examinations are conducted on schedule. Achieved. Achieved. Achieved.
2. Take prompt and effective supervisory action to monitor and address problems identified during compliance examinations of FDIC-supervised institutions that received a “4” or “5” rating for compliance with consumer protection and fair lending laws.  
One hundred percent of follow-up examinations or visitations are conducted within 12 months from the date of a formal enforcement action to confirm compliance with the prescribed enforcement action. Not Achieved. Achieved. Achieved.
3. 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.  
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.  
An analysis is completed for all institutions on the prevalence and scope of repeat instances of significant violations from the previous compliance examination.     Achieved.
A determination is made regarding the need for changes to current FDIC and FFIEC guidance on follow-up supervisory action on significant violations identified during compliance examinations based on the substance and level of risk posed to consumers by these repeat violations.     Achieved.
4. 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.  
Proactively identify and respond to harmful or illegal practices associated with evolving consumer products. Achieved. Achieved.  
Develop and implement new supervisory response programs across all FDIC-supervised institutions to address potential risks posed by new consumer products.   Achieved.  
5. Provide effective outreach related to the CRA, fair lending, and community development.  
Conduct 50 in 2009 (125 in prior years) technical assistance (examination support) efforts or banker/community outreach activities related to CRA, fair lending, and community development. Achieved. Achieved. Achieved.
Evaluate the Money Smart initiative and curricula for necessary updates and enhancements, such as games for young people, information on elder financial abuse, and additional language versions, if needed. Achieved.    
Initiate the longitudinal survey project to measure the effectiveness of the Money Smart for Young Adults curriculum. Achieved.    
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.  
Analysis of survey results is disseminated within six months of completion of the survey through regular publications, ad hoc reports, and other means.   Achieved.  
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. Achieved.  
200,000 additional individuals are taught using the Money Smart curriculum.     Achieved.
120 school systems and government entities are contacted to make them aware of the availability of Money Smart as a tool to teach financial education to high school students.     Achieved.
A review of existing risk management and compliance/CRA examination guidelines and practices is completed to ensure that they encourage and support the efforts of insured financial institutions to foster economic inclusion, consistent with safe and sound banking practices.     Achieved.
A pilot project is conducted with banks near military installations to provide small-dollar loan alternatives to high-cost payday lending.     Not Achieved.
Strategies are developed and implemented to encourage FDIC-supervised institutions to offer small-denomination loan programs.     Achieved.
Research is conducted and findings disseminated on programs and strategies to encourage and promote broader economic inclusion within the nation’s banking system.     Achieved.
6. 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.  
Expand the number of AEI coalitions by two. Achieved.    
Analyze quarterly data submitted by participating institutions to identify early trends and potential best practices. Achieved. Achieved.  
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.  
7. Educate consumers about their rights and responsibilities under consumer protection laws and regulations.  
Expand the use of media, such as the Internet, videos, and MP3 downloads, to disseminate information to the public on their rights and responsibilities as consumers. Achieved.    
8. Effectively investigate and respond to consumer complaints about FDIC-supervised financial institutions.  
Responses are provided to 95 percent (90 percent for 2007-08) of written complaints and inquiries within time frames established by policy, with all complaints and inquiries receiving at least an initial acknowledgment within two weeks. Achieved. Achieved. Achieved.

Receivership Management Program Results

Strategic Goal: Recovery to creditors of receiverships is achieved.

Annual Performance Goals and Targets 2009 2008 2007
1. Market failing institutions to all known qualified and interested potential bidders.  
Contact all known qualified and interested bidders. Achieved. Achieved. Achieved.
2. Value, manage, and market assets of failed institutions and their subsidiaries in a timely manner to maximize net return.  
Ninety percent of the book value of a failed institution’s marketable assets is marketed within 90 days of failure. Achieved. Achieved. Achieved.
Identify and implement program improvements to ensure efficient and effective management of the contract resources used to perform receivership management functions. Achieved.    
3. Manage the receivership estate and its subsidiaries toward an orderly termination.  
Terminate all receiverships within 90 days of the resolution of all impediments.   Achieved. Achieved.
Terminate at least 75 percent of new receiverships within three years of the date of failure. 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.  
For 80 percent of all claim areas, a decision is made to close or pursue claims within 18 months of the failure date. Achieved. Achieved. Not Applicable.
No claims within the 18-month period.
Last Updated 5/5/2011 communications@fdic.gov