Supervisory Insights - Winter 2016 - PDF
Letter from the Director
Articles
Credit Risk Trends and Supervisory Expectation Highlights
Current strong loan growth reflects the continuing economic recovery. Financial institutions that have prudently managed loan growth in the past have been better positioned to withstand periods of stress and continue to serve the credit needs of local communities. This article identifies trends in credit risk and emphasizes to bankers and examiners that now is the time to heed long-standing principles of sound risk management practices. The article examines growth on bank balance sheets and effective risk management practices related to commercial real estate, agriculture, and oil and gas-related lending.
Regular Features
Regulatory and Supervisory Roundup
This feature provides an overview of recently released regulations and other items of interest.
Notice of Correction
A correction has been made to “’Matters Requiring Board Attention’ Underscore Evolving Risks in Banking” which was published in the Summer 2016 issue of Supervisory Insights. On page 11 of this issue, the third sentence in the first full paragraph now reads, “Of these banks, the percentage with a three-year growth rate in excess of 50 percent in either portfolio increased from 23 percent at year-end 2013 to 32 percent at year-end 2015; this percentage increased to 36 percent in the first quarter of 2016.” The sentence previously read, “Of these banks, the percentage with a threeyear growth rate in excess of 50 percent in either portfolio increased from 23 percent at year-end 2013 to 34 percent at year-end 2015; this percentage increased to 39 percent in the first quarter of 2016.” This correction has been made to the PDF version of the Summer 2016 issue on www.fdic.gov.
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.
Martin J. Gruenberg
Chairman, FDIC
Doreen R. Eberley
Director, Division of Risk Management Supervision
Journal Executive Board
Division of Risk Management
Supervision
George E. French, Deputy
Director and Executive Editor
James C. Watkins, Senior Deputy Director
Martin D. Henning, Deputy Director
Brent D. Hoyer, Deputy Director
Melinda West, Deputy Director
Division of Depositor and Consumer
Protection
Sylvia H. Plunkett, Senior Deputy Director
Jonathan N. Miller, Deputy Director
Regional Directors
Michael J. Dean. Atlanta Region
Kristie K. Elmquist, Dallas Region
James D. LaPierre, Kansas City Region
M. Anthony Lowe, Chicago 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
Michael T. Register
Financial Writer
Supervisory Insights is available online by visiting the FDIC’s website at www.fdic.gov. 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 SupervisoryJournal@fdic.gov.
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.