Footnote 1:
A financial institution uses its CMS to identify, monitor, and manage its compliance responsibilities and risks. A CMS includes (1) management and director oversight; (2) a compliance program (policies and procedures, training, monitoring, and complaint response); and (3) audit procedures applied by the institution’s internal or external compliance review function.
Footnote 2:
Regional Director Memorandum No. 00-001 entitled,
Revisions to the Compliance and CRA Examination Frequency Schedule, dated September 19, 2000, revised the examination frequency schedule for compliance and CRA examinations to address statutory changes contained in the Gramm-Leach-Bliley Act of 1999.
Footnote 3:
Transaction testing involves reviewing a sample of transactions, while spot checks involve reviewing a few transactions.
Footnote 4:
According to the
Revised Compliance Examination Procedures, after analyzing the CMS elements in relationship to a bank’s operational risks, examiners decide the necessary transaction sampling and testing. The severity of CMS weaknesses and operational risk will dictate the intensity of transaction testing; greater weakness and higher risk will generally lead to the review of more transactions. If the examiner finds a moderate degree of risk, then sufficient testing should be done to show support for a conclusion. If no transaction testing in a particular regulatory area was done in the previous examination, then examiners should perform a spot check of transactions at the current examination, even if there are no risk indicators.
Footnote 5:
The FDIC follows the
Uniform Interagency Consumer Compliance Rating System approved by the Federal Financial Institutions Examination Council in 1980.
Footnote 6:
Informal actions such as Bank Board Resolutions and Memorandums of Understanding are voluntary commitments made by the board of directors of a financial institution. They are neither publicly disclosed nor legally enforceable.
Footnote 7:
SOURCE is a management support and decision tool that replaced the Banking Information Tracking System (BITS) Compliance Statistical System as the system of record for the compliance and CRA examination program and is extensively used by compliance field supervisors, examiners, review examiners, and Washington office policy staff. SOURCE differs from its predecessor BITS in that SOURCE is used not only to support reporting requirements and a system of record, but also to provide substantial task support for examination staff.
Footnote 8:
All DSC employees use SHARP to track examination hours.
Footnote 9:
The goals are stated in the FDIC 2005-2010 Strategic Plan and the
FDIC 2005 Annual Performance Plan.
Footnote 10:
Effective June 30, 2002, the FDIC’s Division of Supervision and Division of Compliance and Consumer Affairs (DCA) were merged to form the new DSC.