FDIC Updates its Consumer Compliance Examination Schedule

Summary:

The FDIC’s Consumer Compliance Examination Manual has been revised to reflect an updated examination frequency schedule whereby consumer compliance examinations and Community Reinvestment Act (CRA) evaluations will occur less frequently for most institutions.

Statement of Applicability: The contents of, and material referenced in, this FIL apply to all FDIC-supervised financial institutions.

Highlights:

Section II-12.1 of the FDIC’s Consumer Compliance Examination Manual has been revised to reflect an updated consumer compliance examination and CRA evaluation frequency schedule. The update also establishes a new compliance mid-point risk analysis for certain institutions.

Specifically, institutions will generally be on an examination cycle of 66-78 months, 54-66 months, or 24-36 months, depending on their asset size. Examination cycles are based on the date of the last joint Consumer Compliance examination/Community Reinvestment Act (CRA) evaluation. For institutions on an examination cycle of 66-78 months or 54-66 months, with no targeted Consumer Compliance examination or CRA evaluation, examiners will conduct a mid-point risk analysis of the institution and determine if an intervening supervisory activity, such as a targeted visitation, is needed. Adversely rated institutions (institutions not rated a “1” or “2” for Consumer Compliance and “Outstanding” or “Satisfactory” or CRA) will encounter more frequent supervisory activities (examination, evaluation, or visitation).

To assist readers in identifying the changes, the FDIC is providing a redline document that identifies all changes.