Risk Management Manual of Examination Policies - FDIC

REPORT OF EXAMINATION INSTRUCTIONS Section 16.1
PURPOSE
INTERNATIONAL WORKPAPER
PARALLEL-OWNED BANKING ORGANIZATIONS (PBO)
The purpose of this schedule is to detail all of the information needed to ascertain whether a parallel-owned banking
organization (PBO) exists.
WHEN TO COMPLETE
Complete this schedule when an individual, family, or group of persons acting in concert appear to exercise control,
as provided in the “supervisory” definition of control for PBOs as detailed in the International section, of an
institution in the United States and have an interest in a bank or bank holding company in a foreign country.
Examiners should consider all of the issues detailed in the Parallel-Owned Banking Organizations page to ascertain
whether a PBO exists. If the examiner determines that a PBO does not exist, the Parallel-Owned Banking
Organizations page should be maintained in the examination workpapers to document the basis of the examiners’
conclusion. If the examiner determines that a PBO does exist, the Parallel-Owned Banking Organizations page
should be maintained in the examination workpapers unless an adverse trend is noted. The page should be included
in the Report of Examination if any adverse trends are noted within the PBO relationship. Upon the examination’s
completion, the region should forward the Parallel-Owned Banking Organizations page, whether it is included in the
Report of Examination or not, with a cover letter to the DSC Associate Director of the International and Large Bank
Branch.
GENERAL
The FDIC typically does not request or review information on foreign banks or foreign bank holding companies
during the examination process. If a PBO relationship is suspected, the examiner needs to request additional
information to understand the ownership/control structure of the foreign entity. The information on the foreign bank
and/or foreign bank holding company could include, but is not limited to:
• Shareholder list of the foreign bank and any of the companies that own/control it;
• Minutes of the most recent shareholder meeting;
• Annual Reports;
• Composition of the Board of Directors and executive management;
• Organizational chart;
• Web site addresses,
• Policies that the bank in the United States has been instructed to follow;
• Products or services that the bank in the United States has been instructed to offer; and
• Cross-border transactions or services.
ADDITIONAL LINE ITEMS
The examiner may add line items when necessary in each section of the page. The examiner should adjust the
length of the page by moving the discussion of items 1 through 8 between the pages as needed.
Report of Examination Instructions (12-04) 16.1-90 DSC Risk Management Manual of Examination Policies
Federal Deposit Insurance Corporation