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Regulators Issuing Orders on Record Pace; Enforcement Actions Becoming ‘Ordinary’
September 06, 2010
Expect your next safety and soundness exam to be tough — and don’t be surprised if you end up with an enforcement order. Regulators are continuing to issue enforcement actions against banks at a record-breaking rate, with the FDIC already on pace to surpass last year’s...
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Indexed by: Exams/Enforcement | Management
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What will Your Bank Encounter at its First Post-LSA Exam?
August 02, 2010
There will be quite a bit of scrutiny on how you handle those assets – as well as forbearance, according to an essay in FDIC’s Supervisory Insights journal by FDIC Senior Examination Specialist William Baxter, Capital Markets Specialist Ryan Sheller and Chief Accountant Robert Storch....
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Indexed by: Exams/Enforcement | Troubled Banks
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FDIC Tightens Benefits of Loss-Sharing Agreements; Are They Worth the Hassle?
August 02, 2010
Banks eyeing what has appeared to be a lucrative and relatively easy way to expand their operations through FDIC loss-sharing agreements need to be aware of key changes to the program. The FDIC – recently criticized by the GAO for mishandling the initiative – has reduced the amount of...
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Indexed by: Asset Quality | Exams/Enforcement | Troubled Banks
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Special Report: What New Capital Ratios Would Mean for Banks
July 26, 2010
If regulatory capital ratios were to increase in line with recent enforcement orders, banks would have to raise more than $476 billion, an effort that would undoubtedly lead to the merger of many banks and the failures of others, according to an exclusive analysis of Call Report data conducted for...
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Indexed by: Capital Adequacy | Exams/Enforcement | Management
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Why Healthy Banks Need to Raise More Capital than Ever
July 19, 2010
Even healthy banks now believe they must raise more capital than ever before.
Doug Crichfield, president and CEO of Solera National Bancorp ($137.5 million), a de novo bank in Lakewood, Colo., isn’t worried about capital for his bank. (The bank has 19.3% RBC). But Crichfield, who has...
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Indexed by: Capital Adequacy | Exams/Enforcement | Regulation
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Is 12 the new 10? Examiners Ask for More and More Capital, Orders Show
July 19, 2010
Examiners across the country are ordering banks to increase their capital ratios well beyond what is considered well-capitalized, in some cases demanding as much as 14% total risk-based capital, a Bank Safety & Soundness Advisor analysis of enforcement orders shows.
The orders stretch from...
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Indexed by: Capital Adequacy | Exams/Enforcement
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Some Well-Capitalized Banks Hit with C&Ds Over IT Issues
July 12, 2010
Bank examiners are focused on yet another issue of enterprise risk: Inadequate IT systems. Several strongly capitalized banks have been hit with Cease & Desist orders recently.
Consider First Bank of Williamstown (N.J.). The $230 million institution had 10.13% leverage capital and 19.88% Tier 1...
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Indexed by: Exams/Enforcement | Management
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Regulatory Resources at Your Fingertips
July 12, 2010
When it comes to examiners looking at IT issues, there’s no real rulebook for banks to follow. “With IT risks that change so much, the threats and the technology change fast,” explains FDIC Senior Examination Specialist Donald Saxinger. “For someone to say you must have this...
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Indexed by: Exams/Enforcement
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How to Use ERM at Your Bank
June 28, 2010
Although a 2007 report by the FDIC Office of Inspector General is focused on ERM at the agency itself, the paraphrased recommendations below also apply to banks:
Define and communicate the board's risk appetite and ensure the bank's objectives are aligned with that appetite;
Clarify the roles of...
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Indexed by: Exams/Enforcement | Management | Regulation
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Examiners Tighten Screws on Enterprise Risk Management at Banks
June 28, 2010
Regulators have begun to focus more heavily on the way banks handle risk assessment, urging in supervisory guidelines as well as in exams that institutions move toward an “enterprise risk management” model.
Already in 2010, 105 banks have been ordered to write a risk exposure plan,...
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Indexed by: Exams/Enforcement | Management | Regulation
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