Risk Management Manual of Examination Policies - FDIC

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REPORT OF EXAMINATION INSTRUCTIONS Section 16.1 Question 6 This question is intended to: • Determine compliance with applicable laws and regulations. Note: The OFAC of the U.S. Department of the Treasury administers and enforces economic and trade sanctions against targeted foreign countries, terrorism-sponsoring organizations, and international narcotics traffickers based on U.S. foreign policy and national security goals. Reference: OFAC web site Question 7 This question is intended to: • Assist in determining if the bank engages in activities that could potentially increase its exposure to money laundering activity. • Identify areas that may require additional scrutiny during the examination Question 8 This question is intended to: • Determine compliance with applicable laws and regulations. • Alert the examiner to potential money laundering activity by identifying suspicious bank customers or transactions. • Assist in determining if additional action is warranted with regard to suspicious customers or transactions, including filing a "Suspicious Activity Report" if the bank has not already done so. Reference: Part 353 of the FDIC Rules and Regulations Question 9 The purpose of this question is to: • Determine compliance with applicable laws and regulations. • Alert the examiner to potential money laundering activity by identifying suspicious bank customers or transactions. Reference: Part 353 of the FDIC Rules and Regulations Report of Examination Instructions (12-04) 16.1-58 DSC Risk Management Manual of Examination Policies Federal Deposit Insurance Corporation
REPORT OF EXAMINATION INSTRUCTIONS Section 16.1 PURPOSE CONFIDENTIAL – SUPERVISORY SECTION The purpose of this page is to communicate information of interest primarily to supervisory agencies, and should not be duplicative of information contained in the open section of the Report. Use descriptive subheadings to separate subjects and improve readability. MANDATORY COMMENTS Institution Control and Relationships – Unless discussed in the open section of the Report, concisely identify the individual(s) or interest(s) who control the institution. Also identify relevant subsidiaries and affiliates if not discussed in the open section. Such information is important in tracking chain bank organizations and updating bank holding company structure. Interpret the word "controlled" broadly for purpose of this comment. Control may exist in the form of an individual or group, through stock ownership, or other means. Depending upon the situation, ownership of varying percentages of stock may result in control. In a mutual institution, effective control may exist in the form of the Board, a committee thereof, or even a dominant individual. A concentration of decision-making power and/or a lack of supervisory oversight and accountability are keys to determining control and the extent of that control. References: Change in Bank Control - Section 7(j) of the FDI Act Statement of Policy on Changes in Control in Insured Nonmember Banks Examination Scope – Prepare a post-examination comment addressing any significant deviations between projected and actual hours (greater than 15 percent deviation), examination scope, and examination procedures. If no significant variances occurred in these areas, provide a sentence such as: “There were no significant variances between projected and actual examination hours, examination scope, and examination procedures.” BSA Scope – Include a brief comment stating the scope of the BSA review, procedures performed. Include the time period for which FinCEN CTR filing data was compared to bank records, and identify the individuals with whom BSA review findings were discussed. It would also be helpful to state the current examination’s BSA Sharp number. If the bank’s policy allows for numbered accounts, the BSA Scope comment should indicate their existence, so that these high risk accounts can be reviewed at every examination. Loan Penetration – Include the following: • Asset review date • Number of relationships reviewed • Dollar volume of credit extensions reviewed/percent of total credit extensions • Dollar volume of non-homogenous credit extensions reviewed/percentage of total non-homogenous credit extensions (See Transmittal #2002-018, dated 3/26/02, titled “Loan Penetration Ratio”) • Credit extension cutoff review point (if applicable) The loan penetration comment can include a breakdown of loans by major loan type, location, officer, or other information, as appropriate. Note: This information can be effectively presented in chart form. Director Involvement – Prepare a brief statement summarizing the extent of Director participation during the examination process. DSC Risk Management Manual of Examination Policies 16.1-59 Report of Examination Instructions (12-04) Federal Deposit Insurance Corporation
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DSC Risk Management Manual of Exami
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INDEX Section 0.1 Policies, Procedu
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INDEX Section 0.1 Liquidity Managem
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INDEX Section 0.1 Introduction 14.1
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BASIC EXAMINATION CONCEPTS AND GUID
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CAPITAL Section 2.1 INTRODUCTION Pu
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CAPITAL Section 2.1 Interests in As
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CAPITAL Section 2.1 the holder prio
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CAPITAL Section 2.1 • Qualifying
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CAPITAL Section 2.1 application sub
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CAPITAL Section 2.1 may leave the b
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CAPITAL Section 2.1 procedures empl
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CAPITAL Section 2.1 growth and rema
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ASSET QUALITY Section 3.1 INTRODUCT
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LOANS Section 3.2 INTRODUCTION The
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LOANS Section 3.2 Qualifications of
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LOANS Section 3.2 to the ALLL), an
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LOANS Section 3.2 PORTFOLIO COMPOSI
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LOANS Section 3.2 • Require reaso
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LOANS Section 3.2 Internal Controls
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LOANS Section 3.2 continue to suppo
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LOANS Section 3.2 board of director
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LOANS Section 3.2 the institution's
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LOANS Section 3.2 such as for lives
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LOANS Section 3.2 Classification Gu
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LOANS Section 3.2 checks; terms in
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LOANS Section 3.2 • Sublicensee B
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LOANS Section 3.2 similar propertie
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LOANS Section 3.2 policies and proc
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LOANS Section 3.2 Moreover, since t
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LOANS Section 3.2 generally should
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LOANS Section 3.2 exercise control
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LOANS Section 3.2 Problems in this
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LOANS Section 3.2 that reveal other
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LOANS Section 3.2 Other loans of qu
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LOANS Section 3.2 be determined whe
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LOANS Section 3.2 time period elaps
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LOANS Section 3.2 individual apprai
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LOANS Section 3.2 controls over its
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LOANS Section 3.2 consistent with t
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LOANS Section 3.2 such funds, the m
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LOANS Section 3.2 security interest
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LOANS Section 3.2 unambiguous terms
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LOANS Section 3.2 Trustees are sele
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LOANS Section 3.2 be valid but cert
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LOANS Section 3.2 Overview of the S
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LOANS Section 3.2 Although some ins
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LOANS Section 3.2 • Portfolio gro
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LOANS Section 3.2 pricing decisions
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LOANS Section 3.2 trends, condition
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LOANS Section 3.2 provide additiona
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SECURITIES AND DERIVATIVES Section
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CASH AND DUE FROM BANKS Section 3.4
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CASH AND DUE FROM BANKS Section 3.4
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PREMISES AND EQUIPMENT Section 3.5
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PREMISES AND EQUIPMENT Section 3.5
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OTHER REAL ESTATE Section 3.6 Under
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OTHER ASSETS AND LIABILITIES Sectio
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OFF-BALANCE SHEET ACTIVITIES Sectio
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MANAGEMENT Section 4.1 INTRODUCTION
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MANAGEMENT Section 4.1 consequently
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MANAGEMENT Section 4.1 overdue, ren
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MANAGEMENT Section 4.1 money launde
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MANAGEMENT Section 4.1 management l
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MANAGEMENT Section 4.1 • An adequ
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MANAGEMENT Section 4.1 • Troubled
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MANAGEMENT Section 4.1 management i
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INTERNAL ROUTINE AND CONTROLS Secti
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RELATED ORGANIZATIONS Section 4.3
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RELATED ORGANIZATIONS Section 4.3 c
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RELATED ORGANIZATIONS Section 4.3 U
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RELATED ORGANIZATIONS Section 4.3 i
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RELATED ORGANIZATIONS Section 4.3 A
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RELATED ORGANIZATIONS Section 4.3 c
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RELATED ORGANIZATIONS Section 4.3 S
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RELATED ORGANIZATIONS Section 4.3 w
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RELATED ORGANIZATIONS Section 4.3 r
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RELATED ORGANIZATIONS Section 4.3 A
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FIDELITY AND OTHER INDEMNITY PROTEC
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VIOLATIONS OF LAWS AND REGULATIONS
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VIOLATIONS OF LAWS AND REGULATIONS
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MISCELLANEOUS BANKING ACTIVITIES Se
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EARNINGS Section 5.1 structure will
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EARNINGS Section 5.1 demand is low)
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EARNINGS Section 5.1 2. Certain dir
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EARNINGS Section 5.1 capital and al
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LIQUIDITY AND FUNDS MANAGEMENT Sect
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SENSITIVITY TO MARKET RISK Section
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BANK SECRECY ACT, ANTI-MONEY LAUNDE
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BANK FRAUD AND INSIDER ABUSE Sectio
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SUSPICIOUS ACTIVITY AND CRIMINAL VI
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INTERNATIONAL BANKING Section 11.1
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APPLICATIONS Section 12.1 Effective
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APPLICATIONS Section 12.1 for compa
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APPLICATIONS Section 12.1 be tantam
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APPLICATIONS Section 12.1 accept sh
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APPLICATIONS Section 12.1 consideri
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APPLICATIONS Section 12.1 accepted
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APPLICATIONS Section 12.1 The FDIC
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APPLICATIONS Section 12.1 employee
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APPLICATIONS Section 12.1 including
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APPLICATIONS Section 12.1 Branch cl
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APPLICATIONS Section 12.1 its accep
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APPLICATIONS Section 12.1 examinati
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MEMORANDUMS OF UNDERSTANDING Sectio
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CIVIL MONEY PENALTIES Section 14.1
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CMP MATRIX (Continued) Points Sugge
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FORMAL ADMINISTRATIVE ACTIONS Secti
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REPORT OF EXAMINATION INSTRUCTIONS
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Page 471 and 472: REPORT OF EXAMINATION INSTRUCTIONS
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Violations of Laws and Regulations
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Information Technology Assessment (
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Fiduciary Activities Assessment (Co
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Comparative Statements of Financial
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Recapitulation of Securities 99999
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Items Subject to Adverse Classifica
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Analysis of Loans Subject to Advers
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Assets with Credit Data or Collater
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Capital Calculations 99999 Tier 1 C
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Comparative Statements of Income an
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Extensions of Credit to Directors/T
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Confidential - Supervisory Section
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In-House Information Technology 999
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Directors/Trustees and Officers 999
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INTERNATIONAL REPORT PAGES AND WORK
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Analysis of the Country Exposure Ma
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International Loans, Acceptances, a
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International Loans, Acceptances, a
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Foreign Exchange Activities 99999 N
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Position Analysis - Other Currencie
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Revaluation and Income/Loss Analysi
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Policy and Procedures 99999 1. (a)
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Policy and Procedures (Continued) 9
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Audit and Internal Controls - Inter
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Parallel-Owned Banking Organization
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REPORT OF INVESTIGATION INSTRUCTION
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FDIC Report of Investigation THIS R
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Description of the Transaction INVE
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FINANCIAL HISTORY AND CONDITION Ass
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FINANCIAL HISTORY AND CONDITION (Co
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ADEQUACY OF THE CAPITAL STRUCTURE G
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ADEQUACY OF THE CAPITAL STRUCTURE (
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FUTURE EARNINGS PROSPECTS Assess th
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FUTURE EARNINGS PROSPECTS (Continue
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GENERAL CHARACTER OF THE MANAGEMENT
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IV. GENERAL CHARACTER OF THE MANAGE
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Interview Comments IV. GENERAL CHAR
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RISK TO THE FUNDS As a general matt
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VI. CONVENIENCE AND NEEDS OF THE CO
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OTHER PERTINENT INFORMATION If appl
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Source: Application for Federal Dep
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Service Continuity & Monitoring OTH
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