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Supervisory Insights

Summer 2018 Vol. 15, Issue 1 - Table of Contents

Last Updated: March 15, 2023

Supervisory Insights - Summer 2018 - PDF

Letter from the Director


Oil Price Volatility and Bank Performance: A View from the Supervisory Process

The steep drop in oil prices that started in mid-2014, following a five-year boom, tested the risk management practices of insured banks active in oil and gas (O&G) lending as well as other insured banks operating in areas that depend on the O&G industry. During the lead-up and ensuing period of volatility and elevated uncertainty in oil prices, the FDIC’s surveillance and supervision programs focused on monitoring O&G industry trends, quantifying the amount of risk that was building in insured banks with O&G exposure from stress in the sector, and assessing bank management’s actions to mitigate the risk.

Credit Risk Grading Systems: Observations from a Horizontal Assessment

This article is drawn from examiner observations about the loan risk grading systems at selected large state nonmember banks and is intended to illustrate credit grading systems, policies, and processes that were observed to be effective, repeatable, well-governed, and able to mature with business model changes. While much of the discussion is most relevant to larger or more complex banks, some smaller banks may find the topics to be of interest as well. As usual with Supervisory Insights, the article is intended as an informational resource for interested persons and does not create new requirements or establish new supervisory expectations.

Regular Features

Regulatory and Supervisory Roundup

This feature provides an overview of recently released regulations and other items of interest.

Supervisory Insights

Supervisory Insights is published by the Division of Supervision and Consumer Protection of the Federal Deposit Insurance Corporation to promote sound principles and best practices for bank supervision.

Jelena McWilliams
Chairman, FDIC

Doreen R. Eberley
Director, Division of Risk Management Supervision

Journal Executive Board

Division of Risk Management Supervision
Rae-Ann Miller, Senior Deputy Director and Executive Editor
James C. Watkins, Senior Deputy Director
Steven Burton, Deputy Director
Martin D. Henning, Deputy Director
Lori J. Quigley, Deputy Director
Maureen E. Sweeney, Deputy Director

Division of Depositor and Consumer Protection
Sylvia H. Plunkett, Senior Deputy Director
Jonathan N. Miller, Deputy Director

Regional Directors
John P. Conneely, Chicago Region
Michael J. Dean, Atlanta Region
Kristie K. Elmquist, Dallas Region
James D. LaPierre, Kansas City Region
Kathy L. Moe, San Francisco Region
John F. Vogel, New York Region

Journal Staff

Kim E. Lowry
Managing Editor

Amanda M. Lee
Financial Writer

Christopher Pugliano
Financial Writer

Supervisory Insights is available online by visiting the FDIC’s website at To provide comments or suggestions for future articles, to request permission to reprint individual articles, or to request print copies, send an e-mail to

The views expressed in Supervisory Insights are those of the authors and do not necessarily reflect official positions of the Federal Deposit Insurance Corporation. In particular, articles should not be construed as definitive regulatory or supervisory guidance. Some of the information used in the preparation of this publication was obtained from publicly available sources that are considered reliable. However, the use of this information does not constitute an endorsement of its accuracy by the Federal Deposit Insurance Corporation.