Contents

EVALUATION OBJECTIVES AND APPROACH 1
BACKGROUND 3
Single-family SLAs 3
Commercial SLAs 4
EVALUATION RESULTS 5
Program Governance and Administration 6
Acquiring Institutions 6
FDIC Division and Office Resources 7
Risks Associated with the FDIC's Staffing Strategy 10
Compliance Monitoring Contractors 11
RSAM Policies and Procedures 12
Data Collection, Management, and Security 13
Management Reporting 16
Controls to Ensure the Validity of AI Claims 16
Accounting for and Reaching Agreement on the Covered Assets 16
Meetings with AIs 18
Reviewing Loss Claims 18
Proactive Monitoring Initiative 18
Controls to Ensure AIs Are Complying with the Terms of the SLAs 19
Monitoring and Visitation Plans 20
Ensuring that AIs Treat Covered Assets Similarly to Legacy Assets 20
Ensuring that AIs Pursue and Report Recoveries 21
Single-family Loan Modifications 22
Commercial Loan Modifications 23
Ensuring that Suspicious Activity Reports (SAR) Are Filed 24
Visitation Reports and Findings 24
Closing Recommendations 25
Addressing Non-Compliance 26
Controls Related to Estimating and Evaluating Program Costs 27
Estimating SLA Costs 27
Comparison of Estimated to Actual SLA Losses 28
Comparison of Estimated to Actual CMC Costs 29
Controls for Terminating SLAs Early 29
Early Terminations 29
Summary of Prior OIG SLA Reports 31
Overview of Findings and Status of Corrective Actions 31
Trends in Report Findings 33
OIG EVALUATION OF MANAGEMENT COMMENTS 34


TABLES
1. Shared-Loss Data by Type of Agreement, as of September 30, 2011 4
2. Divisions and Offices That Support the SLA Program 8
3. Primary Data Resources for the SLA Program 14
4. SLA Management Reports 16
5. Visitation Reports and Corrective Action Statistics: 2010 and 2011 25
6. Report Recommendations and Questioned Costs as of September 30, 2011 31
7. Status of Recommendations, as of January 26, 2012 32
8. Summary of Common Findings in Prior OIG SLA Reports 33


FIGURE
Top 10 Bank Failures by Initial Shared-Loss Balance 4