Risk Management Manual of Examination Policies - FDIC

Confidential - Supervisory Section 99999
CONTROL AND RELATIONSHIPS
Any Company, Inc., a one-bank holding company, continues to own 100 percent of the common stock. Bank
directors own or control a combined 908,584 shares or 56 percent of holding company stock. President Lincoln is
the largest individual stockholder, controlling 500,326 shares or 31 percent of the outstanding stock. Any Time,
Inc., is a subsidiary of the bank and holds title to ORE. Any Body, Inc., is an on-premise insurance agency
owned by President Lincoln and Director Killingbird. President Lincoln stated that no ownership or management
changes are planned.
EXAMINATION SCOPE
The examination scope was expanded from the pre-exam planning (PEP) memo in the following areas:
• Construction Lending – Expanded due to administrative problems identified in the original loan sample. Ten
additional construction loans serviced by the two construction lenders and originated in 2004 were reviewed.
• BSA Review – Expanded to include a review of all CTRs filed in 2004 due to indications that they were being
filed late.
• Call Reports Review – Expanded to include year-end 2003 in response to the volume of errors noted with our
original review.
As a result, examination hours, totaling 760, are 150 over budget (25 percent). Other examination procedures
were not modified from those identified in the PEP memo.
BSA REVIEW SCOPE
Examiners reviewed the bank’s compliance with the Bank Secrecy Act and financial recordkeeping regulations.
Core analysis procedures of the Examination Documentation module were completed, as well as expanded
procedures related to timely CTR filings, to summarize the findings of this review. Examiners compared bank
records with information on the FinCEN CTR filing data report for October through December 2003, and year-todate
2004. FinCEN 314(a) requests are being received and checked by management. BSA examination findings
were discussed during the examination with President Lincoln and BSA Officer Donna Ludlow. Findings were
also discussed with the bank’s Board of Directors at its September 18, 2004, meeting.
BSA Sharp Number: 67890
LOAN PENETRATION
Asset review date: 7/30/2004
Number of relationships reviewed: 55
Total $ of credit extensions reviewed / % of Total $28,148M / 52%
Total $ of non-homogenous credit extensions reviewed / % of Total $27,635M / 60%
Credit extension cutoff review point: $450M
REMINDERS – The loan penetration comment can include a breakdown of credit extensions by major loan types,
location, officer, etc., as appropriate. The information can be effectively presented in chart form.
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