Offices of

Inspector General

Department of the Treasury

Board of Governors of the Federal Reserve System

Federal Deposit Insurance Corporation

Review of the Joint Implementation

Plan for the Transfer of

Office of Thrift Supervision Functions

OIG-11-064

FRB OIG 2011-02

EVAL-11-002

March 28, 2011

Contents

Review of the Joint Implementation Plan for the Transfer of Page i

Office of Thrift Supervision Functions

Audit Report

Background........................................................................................... 3

Results of the Joint Review .................................................................... 4

The Plan Generally Takes Into Consideration the Orderly Transfer of

Employees......................................................................................... 4

The Plan Describes Procedures and Safeguards to Ensure That OTS 

Employees Are Not Unfairly Disadvantaged Relative to Employees of 

OCC and FDIC ................................................................................... 6

The Plan Sufficiently Takes Into Consideration the Orderly Transfer of

Authority and Responsibilities .............................................................. 7

The Plan Sufficiently Takes Into Consideration the Effective Transfer of 

Funds ............................................................................................... 7

The Plan Sufficiently Takes Into Consideration the Orderly Transfer of 

Property............................................................................................ 8

Other Matters Identified During Our Review........................................... 8

Recommendation......................................................................................... 9

Management Response and OIG Comment ..................................................... 9

Appendices

Appendix 1: Objective, Scope, and Methodology........................................ 11

Appendix 2: Summary of Title III Requirements and the Joint Implementation 

Plan with OIG Analysis ...................................................... 14

Appendix 3: Pay Structures ..................................................................... 57

Appendix 4: Joint Implementation Plan...................................................... 59

Appendix 5 FRB Management Comments ................................................. 87

Appendix 6: FDIC Management Comments ................................................ 88

Appendix 7: OCC Management Comments ................................................ 89

Appendix 8: OTS Management Comments................................................. 92
Contents

Review of the Joint Implementation Plan for the Transfer of Page ii

Office of Thrift Supervision Functions

Appendix 9: Major Contributors to This Report .......................................... 93

Appendix 10: Report Distribution ............................................................... 94

Abbreviations

CFO Chief Financial Officer

Dodd-Frank Act Dodd-Frank Wall Street Reform and Consumer Protection Act

FDIC Federal Deposit Insurance Corporation

FIRF Financial Institutions Retirement Fund

FRB Board of Governors of the Federal Reserve System

OCC Office of the Comptroller of the Currency

OIG Office of Inspector General

OTS Office of Thrift Supervision

Plan Joint Implementation Plan

Title III Transfer of Powers to the Comptroller of the Currency, the 

Corporation, and the Board of Governors

Treasury Department of the Treasury
Offices of Inspector General

Review of the Joint Implementation Plan for the Transfer of Page 1

Office of Thrift Supervision Functions

March 28, 2011

Ben S. Bernanke, Chairman 

Board of Governors of the Federal Reserve System

Sheila C. Bair, Chairman 

Federal Deposit Insurance Corporation

John G. Walsh, Acting Comptroller of the Currency

Office of the Comptroller of the Currency 

John E. Bowman, Acting Director

Office of Thrift Supervision

This report presents the results of our offices’ review of the Joint 

Implementation Plan (Plan) prepared by the Board of Governors of 

the Federal Reserve System (FRB), the Federal Deposit Insurance 

Corporation (FDIC), the Office of the Comptroller of the Currency 

(OCC), and the Office of Thrift Supervision (OTS). The Plan details

the steps the agencies will take to implement the provisions of Title 

III, Transfer of Powers to the Comptroller of the Currency, the 

Corporation, and the Board of Governors, of the Dodd-Frank Wall 

Street Reform and Consumer Protection Act (Dodd-Frank Act). 

Section 327 of Title III mandated the preparation of the Plan and 

our offices’ review.

The objective of our review, as defined by section 327, was to 

determine whether the Plan conforms to the provisions of sections 

301 through 326 of Title III, to include determining whether the 

Plan (1) sufficiently takes into consideration the orderly transfer of 

personnel, (2) describes procedures and safeguards to ensure that 
Review of the Joint Implementation Plan for the Transfer of Page 2

Office of Thrift Supervision Functions

OTS employees are not unfairly disadvantaged relative to 

employees of OCC and FDIC, (3) sufficiently takes into 

consideration the orderly transfer of authority and responsibilities, 

(4) sufficiently takes into consideration the effective transfer of 

funds, and (5) sufficiently takes into consideration the orderly 

transfer of property. As appropriate, we are also to provide any 

additional recommendations for an orderly and effective process. 

To accomplish our objective, we analyzed the extent to which the 

Plan addressed the requirements of Title III, and the actions FRB, 

FDIC, OCC, and OTS have taken or are planning to take to support 

the implementation of Title III. As part of our work, we interviewed 

officials from FRB, FDIC, OCC, and OTS, and representatives from 

the American Federation of Government Employees and the 

National Treasury Employees Union. We conducted our fieldwork 

from January 2011 to March 2011. Appendix 1 contains a detailed 

description of our objective, scope, and methodology.

In brief, we concluded that the Plan generally conforms to the 

provisions of sections 301 through 326 of Title III. However, we 

did note an omission in the Plan. Specifically, the Plan does not 

address the prohibition against involuntary separation or relocation 

of transferred OTS employees for 30 months (except under certain 

circumstances). We are recommending that the Plan be amended 

to address this requirement. 

We also found that, while not impacting our overall conclusion on 

the Plan, certain details need to be worked out to ensure that OTS 

employees are not unfairly disadvantaged and an orderly transfer of 

OTS powers, authority, and employees can be effectively 

accomplished. For example, neither the number of employees to be 

transferred to OCC nor the assignment of functions for those

employees has been finalized. In addition, OTS officials expressed 

concerns relating to (1) OCC’s assignment of individual employees

and (2) additional OCC certification requirements and a newly 

created pay band for certain transferring OTS examiners. We also 

noted that OCC is creating new senior-level positions to manage 

transferred functions. Those positions are being announced as 

competitive between current OCC employees and former OTS 

employees. It is important that OCC ensure the selection of 

personnel for these positions is done in compliance with 
Review of the Joint Implementation Plan for the Transfer of Page 3

Office of Thrift Supervision Functions

5 U.S.C. §3503, Transfer of Functions. Finally, we are reporting on 

several other matters associated with the transfer of OTS 

functions, including an OTS pension fund, savings association 

assessments, and financial reporting by OTS. 

In accordance with section 327, we will be (1) monitoring the 

issues raised above as well as the implementation of the Plan and 

(2) reporting on the progress to transfer the OTS functions every 

6 months. Appendix 2 presents a section by section summary of 

the Title III requirements, the corresponding sections of the Plan, 

and our offices’ analyses. The Plan is provided as Appendix 4.

Background

The Dodd-Frank Act was enacted on July 21, 2010. Title III of the 

act sets forth provisions to address problems and concerns in the 

multiple agency financial regulatory system by abolishing OTS and 

transferring its powers and authorities to FRB, FDIC, and OCC

1 year after enactment (July 21, 2011), deemed the transfer date.

1

All OTS functions relating to federal savings associations, all OTS 

rulemaking authority for federal and state savings associations, and 

the majority of OTS employees are to be transferred to OCC. 

OTS’s supervisory responsibility for state-chartered savings 

associations and OTS employees to support these responsibilities 

are to be transferred to FDIC; and OTS’s authority for consolidated 

supervision of savings and loan holding companies and their nondepository subsidiaries is to be transferred to FRB. No OTS 

employees are required to be transferred to FRB.

Section 327(a) of Title III required FRB, FDIC, OCC, and OTS to 

jointly submit a plan within 180 days to the Congress and the 

Inspectors General of FRB, FDIC, and the Department of the 

Treasury (Treasury), detailing the steps they will take to implement 

the provisions of sections 301 through 326 of Title III. We and the 

 

1 There is a provision in Title III for the Secretary of the Treasury to extend the transfer date up to 18 

months after the enactment of the Dodd-Frank Act upon certain conditions. An extended transfer date 

must be published in the Federal Register not later than 270 days (April 17, 2011) after the enactment 

of the Dodd-Frank Act. We were told by officials of the affected federal banking agencies that a transfer 

date later than July 21, 2011, was not being contemplated at the time of our report. 
Review of the Joint Implementation Plan for the Transfer of Page 4

Office of Thrift Supervision Functions

Congress received the Plan fulfilling this requirement on 

January 25, 2011.

Section 327(b) of Title III requires that within 60 days of receiving 

the Plan, the Inspectors General of FRB, FDIC, and Treasury jointly 

provide a written report to FRB, FDIC, OCC, and OTS, with copies 

to the Congress, that details whether the Plan conforms to the 

provisions of sections 301 through 326 and includes any additional 

recommendations for an orderly and effective process. As also 

required by section 327(b), the Inspectors General of FRB, FDIC, 

and Treasury are to provide a written report on the status of the 

implementation of the Plan every 6 months until all aspects of the 

Plan are implemented. 

Results of the Joint Review

The Plan Generally Takes Into Consideration the Orderly Transfer of 

Employees

We concluded that the Plan generally takes into consideration the 

orderly transfer of OTS employees. However, we noted an

omission in the Plan. Specifically, the Plan does not address the 

prohibition in Title III pertaining to the involuntary separation, or 

involuntary relocation, of transferred OTS employees for 30 

months (except under certain circumstances).2 OCC officials told 

us that while decisions have not been made, they expect there will 

be circumstances where it will be necessary to involuntarily 

reassign an employee outside of his or her geographic location for 

the efficient operation of the agency. FDIC officials stated that 

they could not think of any circumstances that would cause FDIC

to take an involuntary action other than a matter related to 

performance or employee conduct.

In addition, certain details need to be worked out before the 

transfer of individual OTS employees can be effectively 

 

2 As provided in section 322(g), this prohibition does not limit the right of OCC or FDIC to separate an 

employee for cause or for unacceptable performance; terminate an appointment to a position excepted 

from the competitive service because of its confidential policy-making, policy-determining, or policyadvocating character; or reassign an employee outside such employee’s locality pay area when OCC or 

FDIC determines that the reassignment is necessary for the efficient operation of the agency.
Review of the Joint Implementation Plan for the Transfer of Page 5

Office of Thrift Supervision Functions

accomplished. For example, as of March 17, 2011, OCC had not 

finalized the number of employees to be transferred to OCC or the 

assignment of functions for these employees.

In interviews, OTS officials expressed their concerns relating to the 

following matters:

There will not be enough positions with the same functions for 

all OTS transferred employees, including support staff, at OCC. 

For example, with regard to management positions, the current 

number of proposed management positions available to OTS 

transferred employees are fewer than the current number of 

OTS authorized management positions. Accordingly, there is 

concern that OTS managers will be assigned to positions at 

least one level lower than what they currently hold. OTS 

conveyed these concerns to OCC through correspondence and 

meetings. OCC has taken the position that the Dodd-Frank Act 

does not require OCC to redesign or reorganize OCC’s structure 

so that OTS managers are guaranteed particular positions. 

Rather, the act provides that transferred employees will be 

placed in positions at OCC and FDIC responsible for the same 

functions and duties, to the extent practicable (emphasis 

added).

3

OCC plans to require additional certification for certain 

transferred OTS examiners4 prior to them being able to 

supervise national bank examinations. Conversely, FDIC is not 

requiring additional certification for transferred OTS examiners 

before they are able to supervise FDIC-regulated bank

 

3 OCC’s position was communicated to the OTS Deputy Director in a letter dated October 25, 2010,

from the OCC First Senior Deputy Comptroller and Chief Counsel. The applicable language from Title III, 

section 322(e)(2), states that to the extent practicable, each transferred employee shall be placed in a 

position at OCC or FDIC, as applicable, responsible for the same functions and duties as the transferred 

employee had on the day before the date on which the employee was transferred, in accordance with 

the expertise and preferences of the transferred employee.

4 The affected OTS examiners hold the title of Examiner III and they are at the OTS TG-18 grade level, 

with supervisory responsibilities and the authority to sign off on reports of savings association

examinations. According to OCC, being a commissioned national bank examiner demonstrates that the

individual has the requisite competence in not only the full range of safety and soundness issues, but 

also asset management, bank information systems, and compliance. TG-18 examiners have been 

accredited in either safety and soundness, compliance, trust (asset management) or bank information 

technology.
Review of the Joint Implementation Plan for the Transfer of Page 6

Office of Thrift Supervision Functions

examinations. Neither OCC nor FDIC changed their practice with 

respect to how each agency recognizes third-party conferred 

examiner certifications with enactment of the Dodd-Frank Act. 

OCC operates under a long-standing position that an examinerin-charge for a national bank must be an OCC-commissioned

national bank examiner. As a result, OTS is concerned that OCC 

plans to assign the TG-18 OTS examiners to a newly created 

pay band within OCC. This newly created pay band provides for 

the same pay as the current OTS pay band, but with a lower 

salary range than what would have been the case had OCC 

accepted the OTS accreditation. OTS examiners are to remain in 

that newly created pay band until additional certification is 

obtained or until they are selected through competition to a 

higher band (V or VI) position that does not require the NBE 

commission.5 See Appendix 3 for a description of OCC’s 

planned new pay band for certain transferred OTS employees.

OCC has contracted with a consultant to study and identify any 

differences between the OTS examiner accreditation process 

and the OCC Uniform Commission Examination process and to 

provide recommendations. The consultant’s final work product 

was not complete at the time of our report.

As part of our future work on the transfer of OTS functions, we 

will monitor these matters as the Plan is implemented.

The Plan Describes Procedures and Safeguards to Ensure that OTS 

Employees Are Not Unfairly Disadvantaged Relative to Employees 

of OCC and FDIC

The Plan describes procedures and safeguards to ensure that OTS 

employees are not unfairly disadvantaged relative to employees of 

OCC and FDIC. We concluded that the procedures and safeguards 

described in the Plan are reasonable. However, until the transfer of 

OTS employees is accomplished, it is too soon to tell whether the 

procedures and safeguards are effective. As discussed above, OTS 

officials have expressed concerns relating to the (1) OCC’s 

assignment of individual employees and (2) additional OCC 

certification requirements and a newly created pay band for certain 

 

5 OTS examiners at the OTS TG-19 grade level hold certifications that are commensurate to OCC’s 

national bank examiner certifications. These OTS examiners are to be transferred into OCC at the level 

consistent with the OCC examiner and will not be placed in the newly created pay band.
Review of the Joint Implementation Plan for the Transfer of Page 7

Office of Thrift Supervision Functions

examiners. In performing our assessment, we also noted that OCC 

is creating senior-level positions to manage those functions being 

transferred; the positions are being announced as competitive 

between current OCC employees and former OTS employees. It is

important that OCC ensure the selection of personnel for these 

positions is done in compliance with 5 U.S.C. §3503, Transfer of 

Functions.

6

Accordingly, we believe that certain details of the Plan need to be 

worked out before an orderly transfer of individual OTS employees 

can be effectively accomplished, and we will monitor this area 

going forward. 

The Plan Sufficiently Takes Into Consideration the Orderly Transfer 

of Authority and Responsibilities

We concluded that the Plan generally conforms to the provisions of 

the sections relating to the transfer of authority and 

responsibilities, and sufficiently takes into consideration the orderly 

transfer of authority and responsibilities. However, we were 

informed of a potential issue relating to the transfer of functions. 

Specifically, Title III transfers all rulemaking authority for savings 

associations, both federal and state, to OCC. FDIC officials 

expressed concern that not transferring the state-chartered savings 

associations rulemaking authority to FDIC could inhibit FDIC’s 

ability to effectively regulate the 61 state-chartered savings 

associations being transferred to FDIC. FDIC is not seeking or 

currently planning to seek a legislative change; therefore, we do 

not view this issue as one impacting the orderly transfer of OTS 

functions. However, we will monitor this issue going forward.

The Plan Sufficiently Takes Into Consideration the Effective 

Transfer of Funds

The Plan generally conforms to the provisions of the sections 

relating to funding and sufficiently takes into consideration the 

effective transfer of funds. The Plan provides that OTS funds will 

 

6 5 U.S.C. §3503 states that when a function is transferred from one agency to another, each 

competing employee in the function shall be transferred to the receiving agency for employment in a 

position for which he is qualified before the receiving agency may make an appointment from another 

source to that position.
Review of the Joint Implementation Plan for the Transfer of Page 8

Office of Thrift Supervision Functions

be transferred to OCC. FDIC and FRB determined that no funds 

related to the OTS transfer of authority and responsibilities need to 

be transferred to their respective agencies.

We were told that FDIC’s and FRB’s 2011 budgets include funding 

for the transfer of OTS responsibilities. In addition, OCC has reallocated approximately $3 million in its fiscal year 2011 budget to 

pay the expenses associated with the consolidation of certain OTS 

functions before the transfer date of July 21, 2011. OCC has also 

requested that OTS pay an office space termination fee of 

approximately $350,000 for its office in Atlanta, Georgia, so that

OTS staff can be physically consolidated into OCC facilities. 

The Plan Sufficiently Takes Into Consideration the Orderly Transfer 

of Property

The Plan generally conforms to the provisions of the sections 

relating to the transfer of property and sufficiently takes into 

consideration the orderly transfer of property. The Plan does not 

address what property and administrative services are necessary to 

support OCC, FDIC, and FRB prior to the transfer date. However, 

we do not consider this a significant omission in the Plan.

Other Matters Identified During Our Review

The following are other matters that we identified during our 

review.

Underfunded Pension Plan: Most OTS employees participate in 

either the Civil Service Retirement System or the Federal 

Employees Retirement System, which are administered by the 

Office of Personnel Management. However, approximately 460 

OTS retirees and 375 current OTS employees participate in a 

separate retirement system, the Financial Institutions Retirement 

Fund (FIRF), paid by OTS. Under the Plan, OCC is to sponsor

FIRF after the transfer date. OTS’s audited fiscal year 2010 and 

2009 financial statements report disclosed that FIRF had an 

estimated shortfall as of July 1, 2010, of $74.7 million. The 

shortfall is not addressed by the Plan. According to OCC and 

OTS, discussions for managing the underfunded FIRF are 

ongoing.
Review of the Joint Implementation Plan for the Transfer of Page 9

Office of Thrift Supervision Functions

Supervisory Assessments: Section 318 of Title III, which relates 

to funding, states that OCC may collect assessments, fees, or 

other charges, as determined necessary or appropriate to carry 

out its responsibilities; and that the cost of conducting any 

regular examination or special examination may be assessed by 

FDIC against the institution or entity to meet the expenses of 

FDIC in carrying out such examinations. With the transfer of 

OTS functions, federal-chartered savings associations will pay 

assessments to OCC. Consistent with FDIC’s current practice 

for state non-member insured depository institutions for which it 

is the primary federal supervisor, state-chartered savings 

associations will not pay assessments for examinations to FDIC. 

Rather, FDIC is funded by premiums that financial institutions 

pay for deposit insurance coverage and from earnings on 

investments in U.S. Treasury securities. We do not view this 

issue as one that directly impacts the orderly transfer of OTS 

functions. 

OTS Financial Reporting for Fiscal Year 2011: OTS, OCC, and 

their respective auditors are currently determining the financial 

reporting requirements, presentation, and audit scope related to 

OTS’s fiscal year 2011 financial statements. 

Recommendation

We recommend that the principals amend the Plan to address the 

prohibition in section 322(g) of Title III against involuntary 

separation, or involuntary relocation, of transferred OTS employees 

for 30 months (except under certain circumstances).

Management Response and OIG Comment

In written responses, FDIC and OCC, the agencies receiving OTS 

employees, along with OTS, concurred with the recommendation. 

These agencies will work together to incorporate language into the 

Plan that addresses the prohibition in section 322(g) of Title III 

against involuntary separation or involuntary relocations of 

transferred OTS employees by May 16, 2011. FRB stated in its 

written response that it agreed with the conclusion that FRB's part 

of the Plan complies with Title III.
Review of the Joint Implementation Plan for the Transfer of Page 10

Office of Thrift Supervision Functions

In its response, OCC provided additional comments on the transfer 

of OTS employees, and its supervisory approach for transferred 

OTS functions. 

The management comments of FRB, FDIC, OCC, and OTS are 

provided as Appendices 5, 6, 7, and 8, respectively.

The agencies’ planned action meets the intent of our 

recommendation. 

* * * * * * *

We appreciate the courtesies and cooperation provided to our 

staffs during the audit. If you wish to discuss the report, you may 

contact Marla A. Freedman, Assistant Inspector General for Audit, 

Treasury OIG, at (202) 927 5400; E. Marshall Gentry, Acting 

Assistant Inspector General for Evaluations, FDIC OIG, at 

(703) 562-6378; or Anthony J. Castaldo, Associate Inspector 

General for Inspections and Evaluations, FRB OIG, at 

(202) 973 5024. Major contributors to this report are listed in 

Appendix 9.

/s/ /s/ /s/

Eric M. Thorson

Inspector General

Department of the 

Treasury

Jon T. Rymer

Inspector General

Federal Deposit 

Insurance Corporation

Elizabeth A. Coleman

Inspector General

Board of Governors of the 

Federal Reserve System
Appendix 1

Objective, Scope, and Methodology

Review of the Joint Implementation Plan for the Transfer of Page 11

Office of Thrift Supervision Functions

We conducted this joint review to fulfill our requirement under 

section 327(b) of Title III, Transfer of Powers to the Comptroller of 

the Currency, the Corporation, and the Board of Governors (Title 

III), of the Dodd-Frank Wall Street Reform and Consumer Protection 

Act. This section requires the Inspectors General of the Board of 

Governors of the Federal Reserve System (FRB), the Federal 

Deposit Insurance Corporation (FDIC), and the Department of the 

Treasury (Treasury) to review the Joint Implementation Plan (Plan) 

submitted by FRB, FDIC, the Office of the Comptroller of the 

Currency (OCC), and the Office of Thrift Supervision (OTS) 

detailing the steps they will take to implement the provisions of 

Title III.

The objective for our joint review, as defined by section 327(b), 

was to determine whether the Plan conforms to the provisions of 

sections 301 through 326 of Title III, and the provisions of the 

amendments made by such sections, to include determining 

whether the Plan (1) sufficiently takes into consideration the 

orderly transfer of personnel, (2) describes procedures and 

safeguards to ensure that OTS employees are not unfairly 

disadvantaged relative to employees of OCC and FDIC, (3) 

sufficiently takes into consideration the orderly transfer of authority 

and responsibilities, (4) sufficiently takes into consideration the 

effective transfer of funds, and (5) sufficiently takes into 

consideration the orderly transfer of property. As appropriate, we 

are also to provide any additional recommendations for an orderly 

and effective process. We conducted our fieldwork in Arlington, 

Virginia, and Washington, DC from January 2011 to March 2011.

To accomplish our objective, we performed the following work:

We analyzed the extent to which the Plan addressed all the 

requirements of Title III, and actions FRB, FDIC, OCC, and OTS 

have taken or are planning to take to support the 

implementation of sections 301 through 326 of Title III. 

Appendix 2 presents a section by section summary of the Title 

III requirements, the corresponding provisions of the Plan, and

our offices’ analyses.

We reviewed Title III and all related legislation. The Plan is 

provided as appendix 4.

We reviewed relevant documentation such as: correspondence

between the banking agencies’ high-level officials discussing 
Appendix 1

Objective, Scope, and Methodology

Review of the Joint Implementation Plan for the Transfer of Page 12

Office of Thrift Supervision Functions

key issues relating to the transfer of OTS; memoranda and 

policies discussing various aspects of the transfer such as pay 

structures, benefits, and professional certifications; the banking 

agencies’ financial statements audit reports; and the draft report 

of the consultant hired by OCC to identify any differences 

between the OTS examiner accreditation process and the OCC 

Uniform Commission Examination process. 

We interviewed members of the FDIC transition team, including 

the Deputy Director, Corporate Planning and Performance 

Management, Division of Finance, transition team lead; Deputy 

Director, Division of Administration; Chief Information Officer 

and Director, Division of Information Technology; Deputy 

General Counsel, Supervision; Deputy General Counsel, 

Corporate, Consumer, Insurance and Legislation; Associate 

Director, Risk Management Examinations Branch, Division of 

Risk Management Supervision; Deputy Director, Benefits 

Center, Human Resources Branch; and additional FDIC staff 

from the Division of Administration, Division of Risk 

Management Supervision, and Legal Division.

We interviewed members of the OCC/OTS transition team, 

including OCC’s Chief Financial Officer (CFO) and head of the

transition team, OTS’s CFO, OCC’s Deputy Comptroller for 

Human Resources, OTS’s Managing Director for Human Capital, 

OCC’s Deputy Chief Counsel, and OCC’s Director of 

Administrative and Internal Law.

We interviewed OCC senior officials, including the Senior 

Deputy Comptroller for Midsize/Community Bank Supervision, 

and the Director of Public Affairs Operations.

We interviewed OTS senior officials, including the Acting 

Director and the Deputy Director.

We interviewed OCC’s Contracting Officer’s Technical 

Representative responsible for the consultant’s study to identify 

any differences between the OTS examiner accreditation 

process and the OCC Uniform Commission Examination 

process.

We interviewed an OCC representative from the National 

Treasury Employees Union and an OTS representative, the 

Chapter President, from the American Federation of Government 

Employees.

We interviewed FRB senior officials in the Division of Banking 

Supervision and Regulation, and received written responses to 

questions posed to officials in the Legal Division.
Appendix 1

Objective, Scope, and Methodology

Review of the Joint Implementation Plan for the Transfer of Page 13

Office of Thrift Supervision Functions

Consistent with the audit objective, we did not assess FRB’s, 

FDIC’s, OCC’s, or OTS’s overall internal control or management 

control structure, obtain data from their information systems, or

assess the effectiveness of their information system controls.

We conducted this performance audit in accordance with generally 

accepted government auditing standards. Those standards require 

that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and 

conclusions based on our audit objective. We believe that the 

evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objective. 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 14

As required by section 327(a) of Title III, Transfer of Powers to the Comptroller of the Currency, the Corporation, and the Board 

of Governors (Title III), of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), on January 25, 

2011, the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office 

of the Comptroller of the Currency (OCC), and the Office of Thrift Supervision (OTS) submitted a Joint Implementation Plan 

(Plan) to the Congress, and the Inspectors General of the Department of the Treasury (Treasury), FDIC, and FRB detailing the 

steps the respective agencies will take to implement Title III. Section 327(b) of Title III requires the Inspectors General to jointly 

report on whether the Plan conforms to the provisions of sections 301 through 326 of Title III. 

This appendix presents a section by section summary of the Title III requirements, the corresponding sections of the Plan, and 

our offices’ analyses of whether the Plan conforms to Title III requirements. In accordance with Title III, as part of our future 

work on the transfer of OTS functions, we will be monitoring implementation of the Plan and the resolution of certain matters 

discussed in our analysis, and will be reporting on the progress to transfer the OTS functions every 6 months.

Title III does not include sections 303–310, and 320. Additionally, the following Title III sections are not included in this 

appendix because they do not require any specific action be taken by OCC, OTS, FDIC, or FRB: 300-302, 312(c), 314(a), 

314(c), 315, 316(a)(1), 317, 318(a), 319, 321(a)(3), 321(c), 322(a)(3)(A), 322(a)(3)(B), 322(a)(4), 322(c)(1), 322(c)(2), 

322(h)(3), 322(h)(4), 322(i)(2)(E)(ii)(IV), 322(l)(1), and 322(l)(2). The sections excluded from this appendix either discussed the 

purpose of the title, defined certain terms, or amended existing law.

Title III Requirements Joint Implementation Plan Sections OIG Analysis

SUBTITLE A: TRANSFER OF POWERS AND DUTIES

Section 311. Transfer Date.

The transfer date is 1 year (July 21, 2011) after the 

date of enactment of the Dodd-Frank Act, except as 

provided in subsection (b). Subsection (b) allows for 

the Secretary of the Treasury, in consultation with 

the OCC, OTS, FRB, and FDIC, to extend the period 

and designate a transfer date that is not later than 18 

months after the date of enactment of the DoddFrank Act, provided specific Committees of the 

Congress are informed of: (a) a determination that an

Transfer of Authority and Responsibilities (Sec. 3., 

pp. 13-22)

The Plan recognizes the transfer date of July 21, 

2011, 1 year after enactment of the Dodd-Frank 

Act. (pp. 16 & 18)

The Plan conforms to the 

section. According to 

officials of FRB, FDIC, OCC,

and OTS, there are no plans 

at this time to seek a later 

transfer date.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 15

Title III Requirements Joint Implementation Plan Sections OIG Analysis

orderly process to implement Title III is not feasible 

within 1 year; (b) an explanation of why an extension 

is necessary; (c) the new transfer date; and (d) a 

description of the steps that will be taken to initiate 

the process of an orderly and timely implementation 

of Title III within the extended time period. The 

Secretary is also required to publish a Federal 

Register notice of any such extended transfer date

within a certain timeframe. (311(a) and 311(b))

Section 312. Powers and Duties Transferred.

Savings and Loan Holding Company Functions and Rulemaking Authority Transferred

All functions of OTS, including the authority to issue 

orders, relating to the following will be transferred to 

FRB on the transfer date: 

a) the supervision of savings and loan holding 

companies and any subsidiary (other than a 

depository institution) of a savings and loan 

holding company; and 

b) all rulemaking authority relating to savings and 

loan holding companies. (312(b)(1)(A))

FRB shall succeed to all powers, authorities, rights, 

and duties that were vested in OTS relating to the 

functions and authority transferred under 

subparagraph (A). (312(b)(1)(B))

All rulemaking authority of OTS under section 11 of 

the Home Owners' Loan Act (HOLA) (12 U.S.C. 

1468) relating to transactions with affiliates and 

extensions of credit to executive officers, directors, 

and principal shareholders and under section 5(q) of 

Transfer of Authority and Responsibilities 

Regarding Oversight of Savings and Loan Holding 

Companies (FRB) (Sec 3.3., pp. 18-19)

The Plan recognizes that the Dodd-Frank Act 

transfers authority for supervision of savings 

and loan holding companies and their nondepository subsidiaries from OTS to FRB 

effective July 21, 2011.

The Plan states that FRB is working closely 

with OTS, OCC, and FDIC to implement the 

transfer.

FRB and OTS signed a memorandum of 

understanding to facilitate sharing of 

confidential supervisory information.

FRB staff are reviewing FRB’s bank holding 

company supervision program to determine 

how to incorporate savings and loan holding 

companies into the program consistent with 

HOLA. 

Each savings and loan holding company has 

The Plan conforms to the 

section. 

Title III does not address the 

transfer of OTS employees 

to FRB, and, therefore, the 

matter is not required to be 

included in the Plan. 

However, we are including 

an issue raised by FRB senior 

officials because it could 

potentially affect savings and 

loan holding company 

supervision. FRB senior 

officials noted early 

indications of possible 

challenges in recruiting OTS 

personnel because of 

differences between the FRB 

and OTS benefits and salary 

systems. FRB is in the 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 16

Title III Requirements Joint Implementation Plan Sections OIG Analysis

HOLA relating to tying arrangements is transferred to 

FRB.

1

(312(b)(2)(A))

been assigned to an FRB for supervision. To 

facilitate the transition, FRB examiners are 

joining certain OTS examinations prior to the 

transfer date.

Discussions are underway regarding the 

transition of the caseload from OTS to FRB.

FRB anticipates that all regulations as 

appropriate, relating to supervision of savings 

and loan holding companies and their nondepository institution subsidiaries and to 

transactions with affiliates; extensions of 

credit to executive officers, directors, and 

principal shareholders; and tying arrangements 

will continue and will be enforceable by the 

appropriate agency. 

FRB established a working group to analyze 

OTS and FRB regulations and guidance 

documents to determine any policy or 

technical differences and identify any gaps.

FRB will make decisions about whether to 

amend any OTS regulations after the transfer 

date and will only make changes after a public 

comment period.

FRB will have the authority to require 

grandfathered non-financial unitary savings 

and loan holding companies to establish an 

intermediate holding company.

FRB has established a working group to 

process of assessing the 

issue and determining an 

approach to address any 

emerging problems.

 

1 Tying arrangements are prohibited by section 5(q) of HOLA. HOLA defines a tying arrangement as an arrangement whereby the sale of property or a 

financial service (tying good) by a savings association is conditional on the customer obtaining additional credit, property, or financial service (tied good) 

from such savings association.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 17

Title III Requirements Joint Implementation Plan Sections OIG Analysis

consider issues, and provide opportunities for 

public comment prior to implementation of 

unitary savings and loan holding company 

supervision.

Functions and Rulemaking Authority Related to Federal Savings Associations Transferred

All functions relating to federal savings associations 

and rulemaking authority of OTS relating to savings 

associations will be transferred to OCC on the 

transfer date. OCC shall succeed to all powers, 

authorities, rights, and duties that were vested in 

OTS on the transfer date. (312(b)(2)(B))

Federal Savings Associations (Sec 3.1., pp. 13-

14)

All OTS functions relating to the approximately 

670 federal savings associations will be 

transferred on the transfer date to OCC.

All rulemaking authority for federal and state 

savings associations will be transferred to 

OCC on the transfer date.

OCC developed 12 principles to guide the 

supervision integration strategy.2

OCC plans to integrate OTS staff and 

functions into the current OCC structure and 

supervisory model. 

In 2011, OCC and OTS will jointly develop 

fiscal year 2012 examination plans and 

supervisory strategies and will jointly conduct 

a small number of pilot examinations.

The Plan conforms to the 

section.

 

2 OCC’s 12 principles are: (1) building a sustainable staffing structure that provides flexibility through the transition; (2) upholding the protections afforded 

by the legislation and maximizing opportunities for staff; (3) fully and quickly integrating thrifts and OTS staff into OCC’s supervision model; (4) preserving 

the single Deputy Comptroller model in each OCC district and department to ensure clear leadership; (5) preserving the benefits of a flat organizational 

structure, including bank supervision decision-making authority; (6) ensuring a reasonable span of control for managers with the additional savings 

association supervision; (7) minimizing disruption to staff, processes, and industry; (8) minimizing the number of new office locations; (9) over time, 

having employees live where the work is located; (10) over time, ensuring each commissioned examiner has the skill set and credentials to supervise both 

savings associations and banks; (11) deploying staff consistent with OCC’s integrated staffing strategy; and (12) assigning larger federal savings 

associations to OCC’s Midsize and Large Bank Supervision portfolios based on business model and geographic footprint.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 18

Title III Requirements Joint Implementation Plan Sections OIG Analysis

OCC’s community bank supervision unit will 

supervise the vast majority of federal savings 

associations. Its special supervision, midsize, 

and large bank supervision units will supervise 

federal savings associations whose profiles 

align with those units.

Functions of State Savings Associations Transferred

All functions of OTS relating to state savings 

associations will be transferred to FDIC on the 

transfer date. FDIC shall succeed to all powers, 

authorities, rights, and duties that were vested in 

OTS on the transfer date. (312(b)(2)(C))

State Savings Associations (Sec 3.2., pp. 16-17)

The Plan acknowledges the Dodd-Frank Act 

requirement to transfer supervisory 

responsibility for the approximately 61 statechartered savings associations from OTS to 

FDIC. 

FDIC and OTS are working closely to execute 

an orderly transfer of authority and 

responsibility to ensure effective supervision 

during and after the transition period.

FDIC and OTS have agreed on a division of 

responsibility for 2011 examinations 

scheduled.

OTS and the appropriate state regulator will 

retain responsibility for scheduled 

examinations that can be completed prior to

the transfer date. For the remaining 

examinations, OTS and FDIC will develop 

plans for a coordinated transfer of 

responsibility to FDIC.

After the transfer date, FDIC will incorporate 

state-chartered savings associations into its 

supervisory program. All of them are expected 

to be absorbed into FDIC’s regional 

The Plan generally conforms 

to the section. 

We were informed of a 

potential issue relating to the 

transfer of functions. 

Specifically, Title III transfers 

all rulemaking authority for 

savings associations, both 

federal and state, to OCC. 

FDIC officials expressed 

concern that not transferring 

the state-chartered savings 

associations rulemaking 

authority to FDIC could 

inhibit FDIC’s ability to 

effectively regulate the 61 

state-chartered savings 

associations being 

transferred to FDIC. FDIC is 

not seeking or currently 

planning to seek a legislative 

change; therefore, we do not 

view this issue as one 

impacting the orderly transfer 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 19

Title III Requirements Joint Implementation Plan Sections OIG Analysis

supervisory structure.

Prior to the transfer date, FDIC will coordinate 

monthly with OTS regarding examination plans 

and scheduling for state-chartered savings 

associations.

OTS will coordinate with FDIC regarding 

savings associations subject to or expected to 

be subject to enforcement action.

Prior to the transfer date, FDIC will participate 

in OTS examinations of state-chartered 

savings associations with assets of more than 

$1 billion or a CAMELS composite rating of 3 

or lower.3

FDIC may rely on OCC to maintain its 

supervisory systems and make data on statechartered thrifts available to FDIC for a brief 

period of time after the transfer date.

of OTS functions. We will 

monitor this issue going 

forward.

Section 313. Abolishment.

Effective 90 days after the transfer date, OTS and 

the position of OTS Director are abolished. (313)

Transfer of Authority and Responsibilities 

Regarding Oversight of Federal Savings 

Associations (Sec. 3.1., pp. 13-15)

The Plan recognizes that OTS is abolished 90 

days after the transfer date.

Disposition of OTS Affairs (Sec. 6.3., p. 28)

The Acting Director of OTS and a small cadre 

The Plan conforms to the 

section relating to the 

abolishment of OTS. 

However, the Plan does not

specifically mention the 

abolishment of the position 

of OTS Director. We do not 

consider this a significant 

omission.

 

3 Federal banking agencies use the Uniform Financial Institutions Rating System, or “CAMELS,” to assign composite and component ratings to financial 

institutions. An institution’s composite CAMELS rating integrates ratings from six component areas—capital adequacy, asset quality, management, 

earnings, liquidity, and sensitivity to market risk. The ratings range from 1 to 5 with 1 being the highest rating and least supervisory concern.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 20

Title III Requirements Joint Implementation Plan Sections OIG Analysis

of staff will make a final disposition of the 

affairs of OTS during the 90-day period after 

the transfer date. 

OTS will use this period to ensure a full and 

accurate accounting and transfer of all OTS 

assets.

OTS will ensure that compensation and 

benefits owed to OTS employees be provided,

and prudently manage any remaining assets 

until transferred. 

OTS intends to take necessary actions to 

ensure an appropriate disposition of its affairs 

and document the measures taken to wind 

down the agency.

Section 314. Amendments to the Revised Statutes.

The Comptroller of the Currency shall designate a 

Deputy Comptroller who shall be responsible for the 

supervision and examination of federal savings 

associations. (314(b))

Designation of a Deputy Comptroller for Thrift 

Supervision (Sec. 3.1.1., p. 16)

The Deputy Comptroller for Thrift Supervision, 

who will report to the Senior Deputy 

Comptroller for Midsize/Community Bank 

Supervision, will lead the planning process for 

integrating OTS examination and supervision 

functions and staff, serve as a key senior 

management group member, coordinate the 

nationwide network of senior thrift advisors, 

and function as the key advisor to other 

deputy comptrollers on large and problem 

thrifts.

The Plan conforms to the 

section. OCC named a

former OTS employee to this 

position on November 3, 

2010. The individual will 

assume the responsibilities of 

this position on the transfer 

date.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 21

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Section.316. Savings Provisions.

Continuation of Suits

No action or proceeding commenced by or against

OTS or the OTS Director before the transfer date is 

abated. However:

for any action or proceeding arising out of a 

function of OTS or the OTS Director transferred 

to FRB, FRB shall be substituted as a party to the 

action or proceeding on and after the transfer 

date; 

for any action or proceeding arising out of a 

function of OTS or the OTS Director transferred 

to OCC, OCC or the Comptroller of the Currency 

shall be substituted as a party to the action or 

proceeding on and after the transfer date; and 

for any action or proceeding arising out of a 

function of OTS or the OTS Director transferred to 

FDIC, FDIC shall be substituted as a party to the 

action or proceeding on and after the transfer date.

 (316(a)(2)) 

Continuation of Suits (Sec. 3.5., p. 21)

All actions or proceedings commenced by or 

against OTS prior to the transfer date are 

continued.

OCC, FDIC, and FRB will be substituted for 

OTS as parties for such actions on or after the 

transfer date.

OCC, FDIC, and FRB will review OTS litigation 

files and determine which agency will assume 

responsibility. Cases with co-parties that may 

involve dual regulatory oversight under the 

Dodd-Frank Act will be assigned accordingly.

OTS will furnish case files to the receiving 

agencies on or before the transfer date.

OCC and FDIC will handle actions that involve 

employees transferred to OCC or FDIC, 

respectively.

OCC will handle employment actions of former 

OTS employees who have not transferred to 

OCC or FDIC.

The Plan conforms to the 

section.

Continuation of Existing OTS Orders, Resolutions, Determinations, Agreements, etc.

All orders, resolutions, determinations, agreements, 

regulations, interpretative rules, other interpretations, 

guidelines, procedures, and other advisory materials, 

that have been issued, made, prescribed, or allowed 

to become effective by OTS or the OTS Director, or 

by a court of competent jurisdiction, in the 

performance of functions that are transferred shall 

continue in effect, and shall be enforceable by or 

Continuation of Existing Orders, Resolutions, 

Determinations, Agreements, Regulations, etc 

(Sec. 3.6., p. 21)

All orders, resolutions, determinations, 

agreements, regulations, interpretive rules, 

other interpretations, guidelines, procedures, 

and other advisory materials that have been 

The Plan conforms to the

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 22

Title III Requirements Joint Implementation Plan Sections OIG Analysis

against: 

FRB, in the case of a function of OTS transferred 

to FRB;

OCC, in the case of a function of OTS transferred 

to OCC; and

FDIC, in the case of a function of OTS transferred 

to FDIC. (316(b))

issued by OTS, or a court of competent 

jurisdiction, in the performance of functions 

transferred by the Dodd-Frank Act that are in 

effect on the day before the transfer date will 

continue to remain in effect according to their 

terms. These materials will be enforceable by 

or against OCC, FDIC, and FRB, as 

appropriate, consistent with the transfer of 

functions until modified, terminated, set aside, 

or superseded by an appropriate agency, court 

of competent jurisdiction, or operation of law.

Identification of Regulations Continued

Not later than the transfer date:

FRB shall identify and publish a list in the Federal 

Register of the regulations continued that will be 

enforced by FRB;

OCC shall, after consultation with FDIC, identify 

and publish a list in the Federal Register of the 

regulations continued that will be enforced by 

OCC; and

FDIC shall, after consultation with OCC, identify 

and publish a list in the Federal Register of the 

regulations continued. (316(c))

Review of OTS Regulations (Sec. 3.1.3., p. 16)

Identification of Regulations Continued (Sec. 

3.6.1., p. 21)

OCC has begun a review of all OTS regulations 

regarding savings associations and is working 

with OTS staff to determine how to integrate 

OTS regulations with OCC regulations. The 

process is expected to include certain changes 

that will be effective as of the transfer date 

and to continue in phases after that date.

(p. 16)

OCC, FRB, and FDIC have begun to identify 

these regulations and will publish the required 

lists on or before the transfer date. (p. 21)

The Plan conforms to the 

section.

Status of Regulations Proposed or Not Yet Effective
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 23

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Any proposed regulation of OTS before the transfer

date shall be deemed to be a proposed regulation of 

OCC or FRB, as appropriate, according to the terms 

of the proposed regulation. Any interim or final 

regulation of OTS published before the transfer date 

but which has not become effective before that date, 

shall become effective as a regulation of OCC or 

FRB, as appropriate, according to the terms of the 

interim or final regulation. (316(d))

Status of Regulations Proposed or Not Yet 

Effective (Sec. 3.6.2., p. 22)

Any regulation proposed by OTS in performing 

functions transferred by the Dodd-Frank Act 

that has not been published as a final 

regulation before the transfer date will be 

considered to be a proposed regulation of OCC 

or FRB, as appropriate. Any interim or final 

regulation that OTS published prior to the 

transfer date in performing functions 

transferred by the Dodd-Frank Act but which 

has not become effective before the transfer 

date will become effective as a regulation of 

OCC or FRB, as appropriate, unless modified, 

terminated or set aside, or superseded by OCC 

or FRB or a court of competent jurisdiction or 

operation of law.

The Plan conforms to the 

section. 

Section 318. Funding.

Funding of OCC

OCC may collect an assessment, fee, or other charge 

from any entity described in section 3(q)(1) of the 

Federal Deposit Insurance Act (12 U.S.C. 

1813(q)(1)),4as determined necessary or appropriate 

to carry out its responsibilities. In establishing the 

amount of an assessment, fee, or charge collected, 

OCC may take into account the nature and scope of 

the activities of the entity, the amount and type of 

assets that the entity holds, the financial and 

managerial condition of the entity, and any other 

Funding: Establishing an Assessment Process

(Sec. 4.2., pp. 23–24)

OCC (Sec. 4.2.1., p. 23)

Assessments are the primary means of funding 

for OCC and OTS.

In July 2010, OCC and OTS established a 

bank assessment workgroup consisting of 

economic, legal, and financial management 

The Plan conforms to the 

section.

With the transfer of OTS 

functions, federal-chartered 

savings associations will pay 

assessments to OCC. 

Consistent with FDIC’s 

current practice for state 

non-member insured 

 

4 These entities are national banks, federal branch or agency of a foreign bank, and federal savings associations.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 24

Title III Requirements Joint Implementation Plan Sections OIG Analysis

factor. Funds derived from any assessment, fee, or 

charge collected or payment made shall not be 

construed to be Government funds or appropriated 

monies, and shall not be subject to apportionment.

OCC shall have sole authority to determine the 

manner in which the obligations of the OCC shall be 

incurred and its disbursements and expenses allowed 

and paid, except as provided in chapter 71 of title 5 

U.S.C. with respect to compensation.5(318(b))

staff. It meets monthly to develop 

recommendations for the Comptroller of the 

Currency.

depository institutions for 

which it is the primary 

federal supervisor, statechartered savings 

associations will not pay 

assessments for 

examinations to FDIC. We do 

not view this issue as one 

that directly impacts the 

orderly transfer of OTS 

functions.

According to an OCC official, 

OCC will collect the lesser of 

what the savings 

associations would pay 

under the OCC or OTS 

assessment schedules for 

the next two collections 

(September 2011 and March 

2012). After that, all savings 

associations will be on the

same fee schedule as other 

OCC-regulated institutions.

The subject of assessments 

is planned to be included in a

Notice of Proposed 

Rulemaking, which OCC 

believes will be released in 

the latter part of March 

 

5 Chapter 71 of title 5 U.S.C. covers federal employee collective bargaining and conditions of employment.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 25

Title III Requirements Joint Implementation Plan Sections OIG Analysis

2011.

Funding of FRB

FRB shall collect a total amount of assessments, 

fees, or other charges from the following companies 

that is equal to the total expenses FRB estimates are 

necessary or appropriate to carry out its supervisory 

and regulatory responsibilities with respect to such 

companies:

all bank holding companies having total 

consolidated assets of $50 billion or more;

all savings and loan holding companies having 

total consolidated assets of $50 billion or more; 

and

all nonbank financial companies supervised by 

FRB pursuant to the Dodd-Frank Act.6(318(c))

Funding: Establishing an Assessment Process

(Sec. 4.2., pp. 23–24)

FRB (Sec. 4.2.3., p. 24)

The Dodd-Frank Act directs FRB to offset only 

a portion of its total supervision and regulation 

costs by charging fees to supervise 

institutions. 

With respect to savings and loan holding 

companies, only those with assets of $50 

billion or more will be subject to assessment.

FRB will determine costs to carry out its 

supervisory and regulatory responsibilities,

formulate a framework to apportion the costs 

through periodic assessments, and implement 

a process to collect the assessments.

FRB has a team responsible for implementing 

these assessment fees and initial efforts to 

identify supervision and regulation costs are 

underway.

FRB is considering a variety of approaches to 

differentiate these costs from total 

supervision.

The Plan conforms to the 

section.

 

6 Under section 113 of the Dodd-Frank Act, the Financial Stability Oversight Council can make the determination that a U.S. nonbank financial company 

or a foreign nonbank financial company shall be supervised by FRB if the company poses a threat to the financial stability of the United States. 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 26

Title III Requirements Joint Implementation Plan Sections OIG Analysis

FRB plans to provide notice for establishing 

the assessment framework before the 

collection of assessments in 2012.

Funding of FDIC

The cost of conducting any regular examination or 

special examination of any depository institution may 

be assessed by FDIC against the institution or entity 

to meet the expenses of FDIC in carrying out such 

examinations. (318(d))

Funding: Establishing an Assessment Process

(Sec. 4.2., pp. 23–24)

FDIC (Sec. 4.2.2., p. 23)

FDIC does not intend to charge assessments 

for its supervision of state-chartered savings 

associations, consistent with its current 

practice of not charging for its supervision of 

state nonmember banks.

The Plan conforms to the 

section.

SUBTITLE B: TRANSITIONAL PROVISIONS

Section 321. Interim Use of Funds, Personnel, and Property of OTS.

In General and Agency Consultation

Before the transfer date, OCC, FDIC, and FRB shall 

consult and cooperate with OTS to facilitate the 

orderly transfer of functions to OCC, FDIC, and FRB.

(321(a)(1))

Transfer of Personnel (Sec. 2., p. 5)

Senior managers from OCC, OTS, and FDIC 

are meeting regularly to discuss the process 

for transferring functions and to identify the 

functions to transfer to each agency and the 

numbers of employees needed to perform and 

support those functions.

Transfer of Authority and Responsibilities 

Regarding Oversight of [Savings and Loan Holding 

Companies (Sec. 3.3., pp. 18-19)

The Plan conforms to the 

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 27

Title III Requirements Joint Implementation Plan Sections OIG Analysis

FRB is working closely with OTS, OCC, and FDIC 

to implement the transfer of functions.

Before the transfer date, OCC, FDIC, and FRB shall 

determine jointly, from time to time, the amount of 

funds necessary to pay any expenses associated with 

the transfer of functions (including expenses for 

employees, property, and administrative services) 

during the period beginning on the date of enactment 

of the Dodd-Frank Act and ending on the transfer 

date. (321(a)(2)(A))

When requested jointly by OCC, FDIC, and FRB to do 

so before the transfer date, OTS shall pay to OCC, 

FDIC, and FRB, as applicable, such amounts as OCC, 

FDIC, and FRB jointly determine to be necessary.

(321(b)(1))

The Plan does not specifically address the interim 

transfer of funds to OCC. 

Transfer of Funds (Sec. 4., pp. 23-24)

OTS, OCC, FRB, and FDIC established a 

workgroup to address the transfer of remaining 

funds that are not necessary to dispose of 

OTS’s affairs.

The funds remaining on the day prior to 

transfer will remain available to OTS for its 

expenses relating to the agency’s functions 

that are transferred.

On the transfer date, all OTS account balances 

will be transferred to OCC. The agency 

location code and associated fund symbols will 

remain open at the Department of the Treasury 

pending clearance of all outstanding 

transactions.

FDIC determined that no funds will be 

transferred from OTS to FDIC.

FRB determined that no funds will be

transferred from OTS to FRB.

The Plan does not fully 

conform to the requirements

of the section; that is, what 

interim transfer of OTS funds 

may occur. We do not 

consider this a significant 

omission. 

As discussed in the body of 

this report, we were told that 

FDIC’s and FRB’s 2011 

budgets include funding for 

the transfer of OTS 

responsibilities. In addition,

according to OCC, OCC has 

re-allocated approximately 

$3 million in its fiscal year 

2011 budget to pay the 

expenses associated with the 

consolidation of certain OTS 

functions before the transfer 

date of July 21, 2011. OCC 

has also requested that OTS 

pay an office space 

termination fee of 

approximately $350,000 for 

office space in Atlanta, 

Georgia, currently occupied 

by OTS so that OTS staff 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 28

Title III Requirements Joint Implementation Plan Sections OIG Analysis

can be physically 

consolidated into OCC 

facilities. 

Before the transfer date, OCC, FDIC, and FRB shall 

determine jointly which employees are appropriate to 

facilitate the orderly transfer of functions by this title. 

(321(a)(2)(B))

When requested jointly by OCC, FDIC, and FRB to do 

so before the transfer date, OTS shall detail to the

OCC, FDIC, and FRB, as applicable, such employees

as OCC, FDIC, and FRB jointly determine to be 

appropriate. (321(b)(2))

As discussed in other sections, the following are 

examples of employees or workgroups formed 

from OCC, OTS, FDIC, and/or FRB to perform key 

tasks to facilitate the orderly transfer of functions, 

such as the following:

OCC, OTS, and FDIC established transition 

teams to coordinate these efforts [p. 5].

Prior to the transfer date, FDIC will participate 

in OTS examinations of state-chartered 

savings associations with assets of more than 

$1 billion or a CAMELS composite rating of 3 

or lower [p. 17].

FRB staff are reviewing FRB’s bank holding 

company supervision program to determine 

how to incorporate savings and loan holding 

companies into the program consistent with 

HOLA [p. 18]. 

FRB established a working group to analyze 

OTS and FRB regulations and guidance 

documents to identify differences and gaps [p. 

19]. 

OTS employees are working in various work 

groups with FRB, FDIC, and OCC. The Plan 

does not address whether these employees are 

detailed.

OTS, OCC, FRB, and FDIC, working through 

the Federal Financial Institutions Examination

The Plan conforms to the 

section.

According to OTS, OTS and 

OCC have agreed to, and are

already, sharing staff 

resources to facilitate the 

transition. In some cases,

OTS staff have been 

officially detailed to OCC and 

in other cases, OTS staff are 

providing informal assistance 

to facilitate the transition. 

That said, we were also told 

by OTS that it has not been 

able to meet all of OCC’s 

informal requests for staffing 

assistance because of the 

need to meet all its own 

responsibilities until the 

transfer of functions. FDIC is 

prepared to invoke these 

provisions, if necessary. 

According to FDIC, if it

identifies a critical need to 

detail OTS staff before the 

transfer date, it will make 

such a request
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 29

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Council, plan to request public comment 

regarding burden estimates as a result of thrift 

industry reporting requirement changes7[p. 

19].

Federal banking agencies have worked closely 

with each other to deliberate consistent and 

appropriate reporting requirements for savings 

and loan holding companies and their 

subsidiary savings associations [p. 20].

In July 2010 OCC and OTS established a bank 

assessment workgroup consisting of 

economic, legal, and financial management 

staff. It meets monthly to develop 

recommendations for the Comptroller of the 

Currency [p. 23].

OTS, OCC, FRB, and FDIC established a 

workgroup to address the transfer of remaining 

funds that are not necessary to dispose of the 

OTS’s affairs [p. 23].

FRB has a team responsible for implementing 

assessment fees, and initial efforts to identify 

supervision and regulation costs are underway 

[p. 24].

Before the transfer date, OCC, FDIC, and FRB shall 

determine jointly, from time to time, what property 

and administrative services are necessary to support 

OCC, FDIC, and FRB during the period beginning on 

the date of enactment of the Dodd-Frank Act and 

The Plan does not address what property and 

administrative services are necessary to support 

OCC, FDIC, and FRB during the interim period.

While the Plan does not 

address the requirement of 

the section, we do not 

consider this a significant

omission in the Plan.

 

7 The Federal Financial Institutions Examination Council is a formal interagency body empowered to prescribe uniform principles, standards, and report 

forms for the federal examination of financial institutions by FRB, FDIC, the National Credit Union Administration, OCC, and OTS, and to make 

recommendations to promote uniformity in the supervision of financial institutions.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 30

Title III Requirements Joint Implementation Plan Sections OIG Analysis

ending on the transfer date. (321(a)(2)(C))

When requested jointly by OCC, FDIC, and FRB to do 

so before the transfer date, OTS shall make available 

to OCC, FDIC, and FRB, as applicable, such property 

and provide to OCC, FDIC, and FRB, as applicable, 

such administrative services as OCC, FDIC, and FRB

jointly determine to be necessary. (321(b)(3))

An OCC official told us that 

OCC has not requested, nor 

plans to request the use of 

OTS's property prior to the 

transfer date.

Section 322. Transfer of Employees.

In General: OTS Employees

Except for employees transferred to the Bureau of

Consumer Financial Protection,8all employees of OTS 

shall be transferred to OCC or FDIC. (322(a)(1)(A))

OTS, OCC, and FDIC shall jointly determine the 

number of OTS employees necessary to perform or 

support the functions that are transferred to OCC or 

FDIC. (322(a)(1)(B)(i))

Transfer of Personnel (Sec. 2., p. 5)

The OTS Director, the Comptroller of the 

Currency, and the FDIC Chairman will jointly 

determine the number of OTS employees 

necessary to perform and support the 

functions transferred to each agency.

Senior managers from OCC, OTS, and FDIC 

are meeting regularly to discuss the process 

for transferring functions and to identify the 

functions to transfer to each agency and the 

numbers of employees needed to perform and 

support those functions.

Because the OTS functions relating to federal 

savings associations make up the bulk of 

OTS’s operations, most of OTS’s 

approximately 1,000 employees will transfer 

The Plan generally conforms 

to the section.

As of March 17, 2011, OCC 

had not finalized the 

assignment of functions or 

the number of employees 

that will be required to carry 

out those functions.

As discussed in the body of 

this report, OTS expressed 

concern that the 

assignments have not been 

finalized and that there will 

not be enough positions with 

the same functions for all 

 

8 Under Dodd-Frank Act, Section 1064 (a) (5)(A), Identifying Employees For Transfer, of Title X, Bureau of Consumer Financial Protection, which 

establishes the Bureau of Consumer Financial Protection, requires the Bureau and the OTS Director to jointly determine the number of OTS employees 

necessary to perform or support the consumer financial protection functions of OTS that are to be transferred to the Bureau and identify the OTS 

employees for transfer to the Bureau.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 31

Title III Requirements Joint Implementation Plan Sections OIG Analysis

to OCC. 

OCC, OTS, and FDIC established transition 

teams to coordinate these efforts.

OTS shared information related to employee 

data, work locations, salary and classification 

structures, benefits, and human resources 

policies and practices with both OCC and 

FDIC.

OCC, OTS, and FDIC human resources staffs 

worked together to analyze this information, 

identify differences in policies and practices, 

assess implementation impacts, and formulate 

recommendations for the efficient and 

effective integration of their workforces.

OTS transferred employees 

at OCC.

So far, FDIC has committed 

to taking 53 current OTS 

employees—43 examiners

and 8 staff to work on Thrift

Financial Reports, and 2 

administrative law staff. 

More OTS employees may 

transfer to FDIC based on 

additional FDIC needs.

The Plan does not include 

any reference to the 

concurrent activities to 

identify the OTS employees 

to be transferred to the 

Bureau of Consumer 

Financial Protection. While 

we do not consider this a 

significant omission for the 

purpose of the Plan, the 

impact of the transfer of 

OTS employees to the 

Bureau of Consumer 

Financial Protection on the 

orderly transfer of OTS 

functions to OCC, FDIC, and 

FRB will be something we 

plan to assess as the Plan is 

implemented.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 32

Title III Requirements Joint Implementation Plan Sections OIG Analysis

OTS, OCC, and FDIC shall jointly identify OTS 

employees necessary to perform or support the 

functions transferred to OCC or FDIC. 

(322(a)(1)(B)(ii))

Transferring Personnel (Sec. 2.1, pp. 6-7)

OCC will assign OTS employees, to the extent 

practicable, to OCC positions performing the 

same functions and duties that they performed 

prior to the transfer. OCC and OTS are working 

together to reach a consensus on how to 

integrate all OTS grades into OCC pay bands.

FDIC plans a similar approach in integrating 

transferred staff into its existing organizational 

structure. FDIC and OTS have worked together 

to map their respective classification systems. 

Available positions are being identified by 

location and grade, and FDIC plans to solicit the 

interest of OTS employees in these vacancies

in early 2011. Final decisions on the transfer 

and placement of individual OTS employees will 

be made jointly by FDIC and OTS.

The Plan conforms to the 

section. However, it must be 

recognized that the Plan is at 

a high level and, as indicated 

in the Plan and confirmed by 

our interviews with OCC, 

OTS, and FDIC officials,

there are still critical details 

to be worked out before an 

orderly transfer of individual 

OTS employees can be 

effectively accomplished.

Employees Transferred: Service Periods Credited

For purposes of this section, periods of service with a 

federal home loan bank, a joint office of federal home 

loan banks, or a federal reserve bank shall be credited 

as periods of service with a federal agency. 

(322(a)(2))

The Plan does not address this requirement. We do not consider this a 

significant omission in the 

Plan. In interviews, OCC and 

FDIC officials told us that 

this requirement will be met. 

According to FDIC, it plans 

to follow its standard 

operating procedure of

reviewing transferred 

employees’ Official Personnel 

Files and other relevant 

documentation to establish 

or confirm a valid service 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 33

Title III Requirements Joint Implementation Plan Sections OIG Analysis

computation date.

Timing of Transfers and Position Assignments

Each employee to be transferred shall be transferred 

not later than 90 days after the transfer date. 

(322(b)(1))

Transferring Personnel (Sec. 2.1., pp. 6-7)

The transfer of OTS employees must occur no 

later than 90 days after July 21, 2011. 

The Plan conforms to the 

section.

Each employee to be transferred shall receive notice 

of the position assignment of the employee not later 

than 120 days after the effective date of the transfer 

of the employee. (322(b)(2))

Transferring Personnel (Sec. 2.1., pp. 6-7)

OCC and FDIC intend to provide initial 

notification letters to transferring OTS 

employees and meet with them as soon as 

possible, but not later than 60 days before the 

transfer date.

9

Final notification of position assignments with 

full details will follow no later than 120 days 

after the effective date of each employee’s 

transfer.

OTS will provide regular updates to OCC and 

FDIC regarding current employees to ensure 

that both agencies are aware of changes due 

to retirements, transfers, resignations, or other 

actions. This information will ensure that each 

agency maintains accurate rosters through the 

transfer date.

The Plan conforms to the 

section.

Employee Status and Eligibility/Equal Status and Eligibility

The transfer of functions and employees and the 

abolishment of OTS shall not affect the status of the 

transferred employees as employees of an agency of 

Safeguards to Ensure OTS Employees Are Not 

Unfairly Disadvantaged (Sec. 2.2., p. 7)

The Plan conforms to the 

requirements of these 

sections. Because OCC and 

 

9

Initial notices will describe: (a) how the transfer will occur, (b) the actual date of the transfer, (c) information on affecting the transfer through a 

personnel action, (d) the corresponding “grade” level of the transferred employee’s new position, (e) duty location, (f) tentative organizational assignment, 

and (g) available information on the position assignment.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 34

Title III Requirements Joint Implementation Plan Sections OIG Analysis

the United States under any provision of law. 

(322(d))

Each transferred OTS employee shall be placed in a 

position at OCC or FDIC with the same status and 

tenure. (322(e)(1))

To the extent practicable, each transferred employee 

shall be placed in a position at OCC or FDIC, as 

applicable, responsible for the same functions and 

duties as the transferred employee had on the day 

before the date on which the employee was 

transferred, in accordance with the expertise and 

preferences of the transferred employee. (322(e)(2))

OCC and FDIC are committed to ensuring that 

transferred OTS employees receive equitable 

treatment with respect to their status, tenure, 

pay, benefits, and accrued leave or vacation 

time for prior periods of service with a federal 

agency. 

OCC and FDIC intend to properly document all 

decisions regarding position and organizational 

assignments of transferred employees to 

ensure that every transferred employee is 

accounted for, aligned properly into OCC or 

FDIC, and retains the same pay, status, and 

tenure, and to the extent practicable, 

functions and duties in effect immediately 

preceding the effective date of the transfer.

Transfer of Authority and Responsibilities 

Regarding Oversight of Federal Savings 

Associations (Sec. 3.1., pp. 13-16)

Positions created by OCC’s structural changes 

will be posted for internal competition and 

qualified OTS and OCC staff will be 

encouraged to apply. OCC will post the new 

management positions beginning in the first 

quarter of calendar year 2011. The related 

analyst positions will be posted following the

management selections.

OCC’s community bank supervision function 

will continue to have four districts and be led 

by the existing deputy comptrollers. With the 

addition of new federal savings associations 

FDIC are agencies of the 

United States in accordance 

with 12 U.S.C. §1 and 

12 U.S.C. §1819(b)(1), 

respectively, transferred 

employees will retain status 

“as employees of an agency 

of the United States.”

OCC has not finalized the 

work assignments yet. OCC 

has reached out to OTS 

employees through several 

conference calls and 

employee profile forms to 

obtain more information on 

employees’ expertise and 

preferences. 

However, as discussed in 

other parts of this report,

OTS officials have repeatedly 

expressed concern about this 

process. Specifically, they 

noted the following issues

(1) the assignments have not 

been finalized and there will 

not be enough positions with 

the same functions for all 

OTS transferred employees 

at OCC; (2) the proposed 

number of potential 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 35

Title III Requirements Joint Implementation Plan Sections OIG Analysis

and examiners, each district’s span of control 

will increase by more than 50 percent. To help 

manage the workload, OCC created a new 

position, Associate Deputy Comptroller 

(AsDC), who will supervise Assistant Deputy 

Comptrollers (ADC). Each region will have two 

AsDCs except the South, which will have 

three.

OCC will add two ADCs for Midsize Bank 

supervision—one in Chicago and one in 

Washington, D.C.

OCC will add a Senior Advisor for Thrift 

Supervision in each district office and in 

Special Supervision.

The Deputy Comptroller for Thrift Supervision 

(designated on November 3, 2010, pursuant 

to section 314(b) of the Dodd-Frank Act) will 

serve as an advisor to Midsize and Large Bank 

Supervision.

OCC will add ADC and team leader positions 

as necessary and has already developed a 

tentative list.

OCC will add two new field offices, Des 

Moines and Seattle.

Other OCC organizations (i.e., those with 

nonsupervisory functions) are working to 

integrate transferring OTS employees.

management positions 

available to OTS transferred 

employees is lower than the 

current number of OTS 

management positions, 

resulting in OTS managers 

assigned to positions at least 

one level lower than they 

currently hold and lacking 

the same functions, and 

duties;

10 and (3) the seniorlevel positions being created 

by OCC to run the functions 

being transferred to OCC are 

being announced as 

competitive between current 

OCC employees and former 

OTS employees.

In performing our 

assessment, we also noted 

that OCC is creating seniorlevel positions to run those 

functions being transferred; 

the positions are being 

announced as competitive 

between current OCC 

employees and former OTS 

 

10 According to a letter from OCC’s First Senior Deputy Comptroller and Chief Counsel to the OTS Deputy Director dated October 25, 2010, the DoddFrank Act does not require OCC to redesign and reorganize OCC’s structure so that OTS managers are guaranteed particular positions; and provides that 

to the extent practicable, transferred employees will be placed in positions at OCC and FDIC responsible for the same functions and duties. 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 36

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Transfer of OTS Examination Staff (FDIC) (Sec. 

3.2.1., pp. 17-18)

FDIC is working closely with OTS and OCC to 

identify the number of new examiner positions 

that will be required to perform the supervisory 

functions being transferred from OTS to FDIC 

as well as other FDIC examiner vacancies in 

locations where OTS examination staff are 

currently assigned.

OTS employees will be given the opportunity 

to express interest in these positions, and if 

selected, will transfer to FDIC not later than 

90 days after July 21, 2011, as part of the 

transfer of function.

FDIC will fully integrate these employees into 

the FDIC’s existing organizational structure, 

and will assign responsibility for examinations 

and other supervisory activities for each statechartered savings association to the 

appropriate FDIC field office on the transfer 

date.

employees. It is important 

that OCC ensure the 

selection of personnel for 

these positions is done in 

compliance with 5 U.S.C.

§3503, Transfer of 

Functions.

11

Accordingly, there are still a 

number of critical details of 

the Plan that need to be 

worked out before an orderly 

transfer of individual OTS 

employees can be effectively 

accomplished. 

FDIC officials told us that 

OTS employees transferring 

to FDIC include the 

previously mentioned 8 OTS 

employees that work on 

Thrift Financial Reports and 

the 2 OTS administrative law 

staff as well as voluntary

transfers under expression of 

interest announcements.

No Additional Certification Requirements

An examiner who is a transferred employee shall not Training and Certification of Employees (OCC) The Plan generally conforms

 

11 5 USC §3503 states that when a function is transferred from one agency to another, each competing employee in the function shall be transferred to 

the receiving agency for employment in a position for which he is qualified before the receiving agency may make an appointment from another source to 

that position.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 37

Title III Requirements Joint Implementation Plan Sections OIG Analysis

be subject to any additional certification requirements 

before being placed in a comparable position at OCC 

or FDIC, if the examiner carries out examinations of 

the same type of institutions as an OCC or FDIC 

employee as the employee was responsible for 

carrying out before the date on which the employee 

was transferred. (322(f))

(Sec. 3.1.2., p. 16)

OCC and OTS are reviewing each of their 

training and certification programs to ensure 

that existing and transferred employees have 

the training and skills necessary to supervise 

both national banks and federal savings 

associations.

Additional training may be required before 

transferred OTS employees supervise other 

types of institutions [p. 16]. 

The expectation is that on and after the 

transfer date, all examiners who serve as 

examiners in charge of thrifts or banks will 

continue to perform these functions.

OCC engaged a consultant to identify any 

differences between the OTS examiner 

accreditation process and the OCC Uniform 

Commission Examination (UCE) process. The 

study is underway and the consultant will 

provide recommendations for coordinating the 

two processes. 

New examiners hired by OTS in 2010 have 

accepted positions with OCC beginning in 

January 2011, and the agencies plan to enroll 

additional OTS employees in OCC national 

to the section in that 

transferring OTS employees 

are not subjected to 

additional certification 

requirements to continue 

performing examinations of 

savings associations.

However, OTS officials 

expressed concerns that 

OCC plans to require 

additional certification for 

certain transferred OTS 

examiners12 prior to them 

being able to supervise 

national bank examinations. 

Conversely, FDIC is not 

requiring additional 

certification for transferred 

OTS examiners before they 

are able to supervise an 

FDIC-regulated bank 

examination. As discussed 

under “Pay” below, OTS

officials are concerned with 

the implication of OCC 

 

12 The affected OTS examiners hold the title of Examiner III and they are at the OTS TG-18 grade level, with supervisory responsibilities and the authority 

to sign-off on reports of savings association examinations. According to OCC, being a commissioned national bank examiner demonstrates that the

individual has the requisite competence in not only the full range of safety and soundness issues, but also asset management, bank information systems, 

and compliance. TG-18 examiners have been accredited in either safety and soundness, compliance, trust (asset management) or bank information 

technology.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 38

Title III Requirements Joint Implementation Plan Sections OIG Analysis

bank examiner training courses prior to the 

transfer date. 

OCC’s National Bank Examiner commission 

will expand to ensure that each commissioned 

examiner has the skill set and credentials to 

lead examinations of both national banks and 

federal savings associations.

Training and Certification of Employees (FDIC) 

(Sec. 3.2.2., p. 18)

FDIC will treat as commissioned FDIC 

examiners all OTS examiners who transfer to 

FDIC with OTS accreditation.

FDIC will address any individual training gaps 

that emerge after the transfer date through 

individual training and development plans.

placing these transferring 

OTS employees in a newly 

created pay band.

OCC has contracted with a 

consultant to study and 

identify any differences 

between the OTS examiner 

accreditation process and the 

OCC Uniform Commission 

Examination process and to 

provide recommendations. 

The consultant’s final work 

product was not complete at 

the time of our report.

Personnel Actions Limited

Each affected employee13 shall not, during the 30-

month period beginning on the transfer date, be 

involuntarily separated, or involuntarily reassigned 

outside his or her locality pay area. However, this 

requirement does not limit the right of OCC or FDIC 

to separate an employee for cause or for 

unacceptable performance; terminate an appointment 

to a position excepted from the competitive service 

because of its confidential policy-making, policydetermining, or policy-advocating character; or 

reassign an employee outside such employee’s 

The Plan does not address the 30-month period 

during which employees cannot be involuntarily 

separated or relocated.

We consider this to be an 

omission in the Plan that 

should be addressed. 

OCC officials told us that 

while decisions have not 

been made, they expect 

there will be circumstances 

in which it will be necessary 

to involuntarily reassign an 

employee outside of his or 

 

13 Section 322(g)(1)(B) defines an affected employee as an employee transferred from OTS holding a permanent position on the day before the transfer 

date; and an employee of OCC or FDIC holding a permanent position on the day before the transfer date.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 39

Title III Requirements Joint Implementation Plan Sections OIG Analysis

locality pay area when OCC or FDIC determines that 

the reassignment is necessary for the efficient 

operation of the agency. (322(g)(1)(A) and 

322 (g)(2))

her geographic location for 

the efficient operation of the 

agency.

FDIC officials stated that 

they could not think of any 

circumstances that would

cause FDIC to take an 

involuntary action other than 

a matter related to 

performance or employee 

conduct.

Pay

During the 30-month period beginning on the date on 

which the employee was transferred, a transferred 

employee shall be paid at a rate that is not less than 

the basic rate of pay, including any geographic 

differential, that the transferred employee received 

during the pay period immediately preceding the date 

on which the employee was transferred. If the 

employee was receiving a higher rate of basic pay on 

a temporary basis (because of a temporary 

assignment, temporary promotion, or other temporary 

action) immediately before the transfer, the agency 

may reduce the rate of basic pay on the date the rate 

would have been reduced but for the transfer, and 

the protected rate for the remainder of the 30-month 

period will be the reduced rate that would have 

applied but for the transfer. However, OCC or FDIC 

may reduce the rate of basic pay of a transferred 

Protection of Pay, Status, Tenure, Functions and 

Duties (Sec. 2.3., pp. 7-8)

Neither OCC nor FDIC will reduce a transferred 

employee’s pay during the 30-month period 

except in the limited circumstances specifically 

permitted by the Dodd-Frank Act.

OCC and FDIC will ensure the employees’ pay 

is not adversely affected.

Incorporation Into the OCC Pay System (Sec. 

2.7.1., pp. 10-11)

Transferred employees will be paid at a rate 

that is not less than the basic rate of pay, 

including any geographic differential that the 

transferred employees received during the pay 

The Plan conforms to the 

section. According to the 

Plan, transferring OTS 

employees are to be paid at 

the same basic rate of pay 

for the 30-month period after 

the transfer date. 

However, as discussed 

above under “No Additional 

Certification Requirements,” 

OTS officials expressed 

concerns that OCC plans to 

require additional 

certification for certain 

transferred OTS examiners

prior to them being able to 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 40

Title III Requirements Joint Implementation Plan Sections OIG Analysis

employee for cause, including unacceptable 

performance, or with the consent of the transferred 

employee. (322(h)(1) and 322(h)(2))

period immediately preceding the date the 

employee is transferred.

Despite the pay structures of OCC and OTS 

differing significantly, OCC’s salary structure 

can accommodate the transfer of all 

employees from the OTS salary structure.

When a transferred employee’s salary fits 

within the assigned OCC pay band range for 

the assigned position, OCC will set the salary 

within that OCC pay band and at the same 

level the transferred employee received during 

the pay period immediately prior to the 

effective date of the transfer.

Where a transferred employee’s salary 

exceeds the OCC pay band range for the 

position assignment, OCC will assure that the 

pay protection required by the Dodd-Frank Act 

is invoked and applied accordingly.

OCC and OTS compensation policies and 

mechanisms for permanent adjustments to 

base pay and other types of pay increases also 

differ. OCC will maintain its human resources 

policies, including compensation, merit 

increases, and merit bonuses to recognize and 

incentivize performance. OCC continues to 

work closely with OTS human resources 

professionals to identify and resolve 

differences in these policies.

supervise national bank 

examinations. OTS’s concern 

is that OCC plans to assign 

these TG-18 examiners to a 

newly created pay band 

within OCC. This newly 

created pay band provides 

for the same pay as the 

current OTS pay band, but 

with a lower salary range 

than what would have been 

the case had OCC accepted 

the OTS accreditation. The 

examiners are to remain in 

that newly created pay band, 

until additional certification is 

obtained.14 See appendix 3 

for a description of OCC’s 

planned new pay band for 

certain transferred OCC 

employees. 

 

14 OTS examiners at the OTS TG-19 grade level hold certifications that are commensurate to OCC’s national bank examiner certifications. These OTS 

examiners are to be transferred into OCC at the level consistent with the OCC examiner and will not be placed in the newly created pay band.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 41

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Incorporation Into the FDIC Pay System (Sec. 

2.7.2., pp. 11-12)

Despite differences between FDIC and OTS 

classification and pay systems, FDIC is 

confident that its salary structures can, with 

limited adjustments, accommodate the OTS 

salary structures. FDIC will map existing OTS 

positions to the FDIC classification and pay 

system as quickly as possible.

Where a transferred employee’s salary fits 

within the assigned FDIC pay range, FDIC will 

set the salary at the same level within that 

FDIC pay grade.

Where a transferred employee’s salary 

exceeds the maximum salary for the assigned 

FDIC pay range, FDIC will maintain the 

employee’s higher salary in accordance with 

Dodd-Frank Act requirements. 

FDIC will maintain its established policies 

regarding performance-based base pay 

increases and bonuses/lump sum payments to 

recognize and incentivize performance. 

FDIC will work with OTS human resources 

professionals as needed to identify and resolve 

differences in policies. 

Retirement Benefits for Transferred Employees

Each transferred employee shall remain enrolled in 

the retirement plan of the transferred employee, for 

as long as the transferred employee is employed by 

OCC or FDIC. (322(i)(1)(A)(i))

Protection and Continuation of Retirement 

Benefits (Sec. 2.4., p. 8)

The majority of OCC, FDIC, and OTS 

employees participate in one of two retirement 

The Plan conforms to the 

section. We noted that 

according to OTS’s audited 

fiscal year 2010 financial 

statements, FIRF had an
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 42

Title III Requirements Joint Implementation Plan Sections OIG Analysis

systems administered by the Office of 

Personnel Management (OPM)—the Civil 

Service Retirement System (CSRS) and the 

Federal Employees Retirement System (FERS).

Approximately 375 current OTS employees 

participate in a third system, the Financial 

Institutions Retirement Fund (FIRF), and 

approximately 460 retirees receive a FIRF 

annuity. 

Transferred OTS employees covered by CSRS 

or FERS will remain in those retirement 

systems.

Because OTS serves as the benefit 

administrator for OTS retirees—such as OPM 

serves as the CSRS and FERS benefit 

administrator for federal agencies—OCC will 

assume that same benefit administrator role 

for OTS/FIRF employees on the transfer date. 

OCC has also agreed to provide retirement 

benefits administration for OTS/FIRF 

employees who transfer to FDIC and the 

Bureau of Consumer Financial Protection. 

OCC will modify its financial systems to 

accommodate any additional transactions 

required to support FIRF entitlements.

Supplemental Retirement Benefits (Sec. 2.5., pp. 

8-9)

Both OCC and FDIC have additional retirement 

savings programs for their employees that will 

be available to transferred OTS employees. 

estimated shortfall as of 

July 1, 2010, of $74.7 

million. According to OTS, 

OTS and OCC are discussing 

options for managing the 

underfunded FIRF.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 43

Title III Requirements Joint Implementation Plan Sections OIG Analysis

Transferred employees may participate and roll 

over OTS-unique retirement savings programs 

into these programs.15

OCC or FDIC, as appropriate, shall pay any employer 

contributions to the existing retirement plan of each 

transferred employee, as required under each such 

existing retirement plan.16 (322(i)(1)(A)(ii))

Protection and Continuation of Retirement 

Benefits (Sec. 2.4., p. 8)

OCC will modify its payroll system to include 

an OTS/FIRF identifier to ensure that OCC 

makes accurate contributions to the FIRF 

account.

Agencies receiving transferred OTS employees 

will make payroll and financial systems 

adjustments similar to those of OCC to 

accommodate FIRF entitlements of these 

transferred OTS employees and will coordinate 

with OCC to ensure integrated benefits 

delivery to these employees. 

The Plan conforms to the 

section.

According to OCC officials, 

OCC has begun working with 

the National Finance Center, 

which is OCC’s and FDIC’s 

payroll processing provider,

to complete programming 

changes necessary for the 

administration of OTS 

benefits.

Benefits Other Than Retirement Benefits

During the First Year

For 1 year following the transfer date, each 

transferred employee may retain membership in any 

employee benefit program (other than a retirement 

benefit program) of the agency from which the 

employee was transferred, including any dental, 

vision, long term care, or life insurance program to 

Protection and Continuation of Benefits Other 

Than Retirement (Sec. 2.6., pp. 9-10)

OTS employees will remain in OTS benefits 

programs as currently constituted for the first 

year after transfer. 

The Plan conforms to the 

section regarding 

membership. 

An OCC official told us that

OCC will comply with this 

 

15 FDIC and OCC provide an automatic contribution of 1 percent of pay and an additional matching contribution up to 4 percent of pay to eligible 

employees’ federal Thrift Savings Plan accounts. In addition, FDIC and OCC employees can contribute a portion of their base pay to a sponsored taxdeferred 401(k) savings plan. FDIC and OCC provide eligible employees with a maximum matching contribution of 5 percent and 3 percent, respectively.

16 Section 322 (i)(1)(B) defines an existing retirement plan, with respect to a transferred employee, as the retirement plan (including FIRF), and any 

associated thrift savings plan, of the agency from which the employee was transferred in which the employee was enrolled on the day before the date on 

which the employee was transferred.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 44

Title III Requirements Joint Implementation Plan Sections OIG Analysis

which the employee belonged on the day before the 

transfer date. OCC or FDIC, as appropriate, shall pay 

any employer cost required to extend coverage in the 

benefit program to the transferred employee as 

required under that program or negotiated 

agreements. (322(i)(2)(A))

OCC and FDIC will jointly explore options for 

the most efficient administration of OTS’s life 

insurance benefit program during the interim 

period.

The Plan does not address the requirement to 

pay any employer costs required to extend 

coverage in the benefit program to the

transferred employee, although that could be 

inferred since it does include the provision that 

OTS employees will remain in OTS benefits 

programs for the first year.

provision.

FDIC officials told us that 

FDIC will offer transferred 

OTS employees the option to 

change to FDIC benefits. The 

transferred OTS employees 

will have 30 days to make 

their decision, as would any 

new FDIC employee. If OTS 

employees elect to retain 

their OTS benefits for 1 year, 

FDIC will comply with this 

provision as set forth.

Dental, Vision, or Life Insurance After the First Year

If, after the 1-year period beginning on the transfer 

date, OCC or FDIC determines that OCC or FDIC will 

not continue to participate in any dental, vision, or 

life insurance program of an agency from which an 

employee was transferred, a transferred employee 

who is a member of the program may, before the 

decision takes effect and without regard to any 

regularly scheduled open season, elect to enroll in the 

enhanced dental benefits program established under 

chapter 89A, the vision benefits established under 

chapter 89B, and the Federal Employees' Group Life 

Insurance Program 87 (without regard to any 

requirement of insurability) established under chapter 

87. These chapters are part of 5 U.S.C. (322(i)(2)(B))

Protection and Continuation of Benefits Other 

Than Retirement (Sec. 2.6., pp. 9-10)

After 1 year, all employees will transition to 

OCC and FDIC benefit programs. 

Human resource specialists from OCC, FDIC, 

and OTS completed a side-by-side analysis 

comparing the benefits at the three agencies. 

They determined that the following programs 

are comparable: Federal Employees Health 

Benefits, Federal Employees Group Life 

Insurance, and employee-paid programs (Long 

Term Care insurance and the Federal 

Employees Dental and Vision Insurance 

Program (federal dental and vision insurance).

The Plan conforms to the 

section.

Long Term Care Insurance After the First Year

If, after the 1-year period beginning on the transfer Protection and Continuation of Benefits Other The Plan conforms to the 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 45

Title III Requirements Joint Implementation Plan Sections OIG Analysis

date, OCC or FDIC determines that OCC or FDIC, as 

appropriate, will not continue to participate in any 

long term care insurance program of an agency from 

which an employee transferred, a transferred 

employee who is a member of such a program may, 

before the decision takes effect, elect to apply for 

coverage under the Federal Long Term Care 

Insurance Program established under chapter 90 of 

5 U.S.C., under the underwriting requirements 

applicable to a new active workforce member.

(322(i)(2)(C))

Than Retirement (Sec. 2.6., pp. 9-10)

After one year, all employees will transition to 

OCC and FDIC benefit programs.

Human resource specialists from OCC, FDIC, 

and OTS completed a side-by-side analysis and 

determined the benefits of long term care 

insurance programs at the three agencies are 

comparable.

section.

Contribution of Transferred Employee

A transferred employee who is enrolled in a plan 

under the Federal Employees Health Benefits Program 

shall pay any employee contribution. OCC or FDIC, 

as applicable, shall pay any difference in cost 

between the employee contribution required under 

the plan provided to transferred employees by the 

agency from which the employee transferred and the 

plan provided by OCC or the FDIC, as the case may 

be. OCC or FDIC shall transfer to the Employees 

Health Benefits Fund, an amount determined by 

OPM, after consultation with OCC and FDIC, as the 

case may be, and the Office of Management and 

Budget, to be necessary to reimburse the Employees 

Health Benefits Fund for the cost to the fund of 

providing any benefits under this subparagraph that 

are not otherwise paid for by a transferred employee 

under clause (i). (322(i)(2)(D))

The Plan does not specifically state that a 

transferred employee who is enrolled in a plan 

under the Federal Employees Health Benefits 

Program will pay any employee contribution or 

that OCC or FDIC will pay any difference in 

cost.

The Plan also does not address OCC or FDIC’s 

responsibility to pay any difference in cost 

between the employee contribution required 

under the plan and the plan provided by OCC 

or FDIC, respectively.

The Plan does not address the transfer of 

funds from OCC or FDIC to the Employees 

Health Benefits Fund.

We do not consider this a 

significant omission in the 

Plan. Employee and employer 

contributions under the 

Federal Employees Health 

Benefits Program are set by 

law. OCC, FDIC, and OTS 

are currently part of the 

program; thus, any 

contributions paid by OTS 

and its employees will carry 

over to OCC and FDIC.

According to an OCC official,

OCC will comply with these 

provisions.

According to an FDIC

official, FDIC will comply 

with these provisions. FDIC 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 46

Title III Requirements Joint Implementation Plan Sections OIG Analysis

has arranged for OCC to 

administer OTS legacy 

benefit programs for OTS 

staff that transfer to 

FDIC. FDIC will reimburse 

OCC for the relevant costs.

Special Provisions To Ensure Continuation of Life Insurance Benefits:

An annuitant who is enrolled in a life insurance plan 

administered by an agency from which employees are 

transferred on the day before the transfer date shall 

be eligible for coverage by a life insurance plan under 

5 U.S.C., or by a life insurance plan established by 

OCC or FDIC, as applicable, without regard to any 

regularly scheduled open season or any requirement 

of insurability. A transferred employee shall pay any 

employee contribution required by the plan. OCC or 

FDIC shall pay any difference in cost between the 

benefits provided by the agency from which the 

employee transferred and the benefits provided. 

Additionally, OCC or FDIC shall transfer to the 

Federal Employees' Group Life Insurance Fund, an 

amount determined by OPM, after consultation with 

OCC and FDIC, to be necessary to reimburse the 

Federal Employees' Group Life Insurance Fund for the 

cost to the Federal Employees' Group Life Insurance 

Fund of providing benefits not otherwise paid for by 

a transferred employee. (322(i)(2)(E))

The Plan does not address these provisions. We do not consider this a 

significant omission of the 

Plan. An OCC official stated 

that OCC is obtaining 

consulting advice as to how 

to handle the retiree life 

insurance for annuitants.

According to an FDIC 

official, since OCC will be 

administering FIRF, FDIC will 

not have any annuitant 

issues related to the transfer 

of OTS powers and 

authorities. FDIC extends 

one FDIC-specific benefit to 

annuitants—dental 

insurance—and any 

transferred OTS staff will be 

treated the same as any 

other FDIC employee for 

purposes of qualifying for 

that benefit at retirement.

Incorporation Into Agency Pay System

Not later than 30 months after the transfer date, 

OCC and FDIC shall place each transferred employee 

Transferring Personnel (Sec. 2.1., p. 6) The Plan conforms to the 

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 47

Title III Requirements Joint Implementation Plan Sections OIG Analysis

into the established pay system and structure of the 

appropriate employing agency. (322(j))

OTS employees transferring to OCC and FDIC 

will be placed into OCC’s and FDIC’s 

established pay systems and structures as 

soon as feasible following the date of transfer, 

but not later than 30 months after the transfer 

date. 

OCC and FDIC determined that their current 

pay systems, with some possible 

modifications, can accommodate OTS’s salary 

structure. However, the 30-month protection 

of pay may necessitate the retention of 

separate systems and structures for a period 

of time.

Incorporation Into the OCC Pay System (Sec. 

2.7,1., pp. 10-11)

Despite the pay structures of OCC and OTS 

differing significantly, OCC salary structure 

can accommodate the transfer of all 

employees from the OTS salary structure. 

Incorporation Into the FDIC Pay System (Sec. 

2.7.2., pp. 11-12)

Despite differences between FDIC and OTS 

classification and pay systems, FDIC is 

confident that its salary structures can, with 

limited adjustments, accommodate the OTS 

salary structures.

FDIC plans to convert transferred OTS 

employees to its pay system as soon as 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 48

Title III Requirements Joint Implementation Plan Sections OIG Analysis

feasible after the transfer date and well before 

the 30-month deadline. 

Equitable Treatment

OCC and FDIC:

may not take any action that would unfairly 

disadvantage a transferred employee relative to 

any other OCC or FDIC employee on the basis of 

prior employment by OTS. 

may take such action as is appropriate in an 

individual case to ensure that a transferred 

employee receives equitable treatment, with 

respect to the status, tenure, pay, benefits (other 

than benefits under programs administered by 

OPM), and accrued leave or vacation time for 

prior periods of service with any federal agency of 

the transferred employee. 

shall, jointly with OTS, develop and adopt 

procedures and safeguards designed to ensure 

that these requirements are met. 

shall conduct a study detailing the position 

assignments of all employees transferred, 

describing the procedures and safeguards 

adopted, and demonstrating that the requirements 

of this subsection have been met; and shall, not 

later than 1 year after the transfer date, submit a 

copy of such study to Congress. (322(k))

Safeguards to Ensure OTS Employees Are Not 

Unfairly Disadvantaged (Sec. 2.2., p. 7)

No changes will be adopted that in any way 

result in an unfair disadvantage to transferred 

employees. 

OCC and FDIC are committed to ensuring that 

transferred OTS employees receive equitable 

treatment with respect to their status, tenure, 

pay, benefits, and accrued leave or vacation 

time for prior periods of service with a federal 

agency.

Both OCC and FDIC leadership and human 

resources employees have worked with their 

OTS counterparts to review human resources 

policies, identify gaps and differences in those 

policies, and assess impacts of those 

differences. Based on this analysis, OCC and 

FDIC plan to continue existing human 

resources policies. The two agencies will 

consider future changes to policies where they 

benefit the combined organizations and their 

employees. No changes will be adopted that in 

any way result in an unfair disadvantage to 

transferred employees.

OCC and FDIC will submit a study to Congress 

within 365 days after the transfer date 

describing and demonstrating the procedures 

and safeguards adopted by the agencies to 

The Plan conforms to these 

requirements. However, as 

stated above, under “No 

Additional Certification 

Requirements,” OTS officials 

expressed concerns that 

OCC plans to require 

additional certification for 

certain transferred OTS 

examiners prior to them 

being able to supervise 

national bank examinations. 

Conversely, FDIC is not 

requiring additional 

certification for transferred 

OTS examiners before they 

are able to supervise an 

FDIC-regulated bank 

examination. OTS officials

are concerned with the 

implication of OCC placing 

these transferring OTS 

employees in a newly 

created pay band.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 49

Title III Requirements Joint Implementation Plan Sections OIG Analysis

ensure that they meet these requirements.

Section 323. Property Transferred17.

No later than 90 days after the transfer date, all 

property of OTS (other than property described under 

paragraph (b)(2)) that OCC and FDIC jointly 

determine is used, on the day before the transfer 

date, to perform or support the functions of OTS

transferred to OCC or FDIC, shall be transferred to 

OCC or FDIC in a manner consistent with the transfer 

of employees. (323(b)(1))

Transfer of Property (Sec. 5, pp. 25-27)

The agencies will complete the property 

transfer no later than 90 days after the 

transfer date. 

Transfer of the OTS Building and Real Property 

(Sec. 5.1., p. 25)

The agencies have jointly determined that 

ownership of all buildings and real property 

will transfer to OCC. 

FDIC will house transferring OTS employees in 

current FDIC facilities.

OCC’s legal staff is working to determine 

appropriate transfers of title and transfers of 

leases to OCC effective July 21, 2011.

Transfer of Information Technology Assets, 

Systems, and Infrastructure (Sec. 5.2., p. 25)

OCC, FDIC, and OTS chief information officers 

are working closely together to develop a plan 

to integrate the agencies’ assets and systems. 

The agencies will follow applicable policies and 

procedures to ensure that all assets are 

The Plan conforms to the 

section.

 

17 For purposes of this section, the term property includes all real property (including leaseholds) and all personal property, including computers, furniture, 

fixtures, equipment, books, accounts, records, reports, files, memoranda, paper, reports of examination, work papers, and correspondence related to such 

reports, and any other information or materials.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 50

Title III Requirements Joint Implementation Plan Sections OIG Analysis

transferred in a structured and secure manner 

to support transferred functions and 

employees.

OCC (Sec. 5.2.1., p. 25)

OCC and OTS have developed an analysis 

framework and completed a comprehensive 

inventory of IT assets and systems by 

business function. 

OCC staff is analyzing both agencies’ systems, 

from the business and technical perspective to 

recommend the best course of action for each 

system with the goals of integrating and 

aligning business and reducing duplication as 

much and as quickly as possible.

OCC anticipates that some information 

systems may need to run in parallel for an 

initial period to ensure continuity and 

availability.

The Plan will also ensure that core OCC 

administrative systems and IT infrastructure 

services, such as time and attendance and 

e-mail, are available to all incoming OTS staff 

by the transfer date.

OCC will allot sufficient time for training OTS 

and OCC employees on any new systems as 

necessary.

FDIC (Sec. 5.2.2., pp. 25-26)

FDIC and OTS staff will work together to 
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 51

Title III Requirements Joint Implementation Plan Sections OIG Analysis

determine how best to integrate supervisory 

and administrative information from OTS 

systems into existing FDIC automated 

information systems, with a goal of 

accomplishing this transition as quickly as 

possible.

The staff will also develop guidelines for the 

retention and archiving of relevant OTS data to 

ensure that it continues to be available, as 

needed, in the future.

FDIC does not anticipate transferring from 

OTS any IT systems, equipment, or other 

infrastructure. To ensure compatibility, FDIC 

will issue standard FDIC IT equipment and 

software to all OTS employees transferring to 

FDIC.

Transfer of Records (Sec. 5.3., pp. 26-27)

By the transfer date, OTS will update and 

verify inventories and locations of paper and 

electronic records for both current and active 

records as well as archived records.

OTS records and information regarding OTS 

functions and activities will be transferred to 

OCC, FDIC and FRB.

OTS, OCC, and FDIC records management 

staffs established a joint team that is working 

to identify the types of records and the related 

comprehensive records schedules for both 

agencies, and to identify and catalogue the 

number and physical location of all records.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 52

Title III Requirements Joint Implementation Plan Sections OIG Analysis

The joint team is working directly with the 

National Archives and Records Administration 

(NARA) to determine how best to establish a 

new, joint comprehensive records schedule for 

OCC and its expanded responsibilities.

Team members are jointly preparing a plan for 

physically transferring OTS records, as 

appropriate, to OCC, FDIC, and FRB 

recordkeeping facilities, NARA facilities and 

the Federal Records Centers.

All books, accounts, records, reports, files, 

memoranda, papers, documents, reports of 

examination, work papers, and correspondence of 

OTS that OCC, FDIC, and FRB jointly determine is 

used, on the day before the transfer date, to perform 

or support the functions of the OTS transferred to 

FRB under this title shall be transferred to FRB in a 

manner consistent with the purposes of this title. 

(323(b)(2))

Transfer of Property (Sec. 5., pp. 25-27)

FRB (Sec. 5.2.3., p. 26)

FRB is working with OTS on direct access to 

OTS systems and official records18 to the 

extent consistent with the Dodd-Frank Act, 

other applicable law, and other legal 

constraints. 

FRB has access to comprehensive OTS 

databases containing structure and financial 

data.

FRB is working with FDIC and OCC to ensure 

comprehensive bilateral information sharing 

and coordination for thrift subsidiaries 

comparable to that in place for bank holding 

companies’ bank subsidiaries.

An interagency team will handle the 

supervisory information requirements in a 

The Plan conforms to the 

section.

 

18 The official records include supervisory ratings, enforcement actions, other assessments, examination reports and related work papers, application 

filings, and all other communications with savings and loan holding companies.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 53

Title III Requirements Joint Implementation Plan Sections OIG Analysis

similar manner, preparing for automated 

transfers of key OTS supervisory information 

to FRB to be incorporated in FRB automated 

systems.

Transfer of Records (Sec. 5.3., pp. 26-27)

By the transfer date, OTS will update and 

verify inventories and locations of paper and 

electronic records for both current, active 

records as well as archived records. 

FRB is coordinating with OTS to transfer 

records necessary to effectively carry out its 

supervisory responsibilities.

Transfer of Other Assets (Sec. 5.5., pp. 27)

FDIC and FRB have determined that they do 

not require any additional assets not described 

in the plan from OTS.

OCC recently completed an inventory of 

accountable property and has updated its

asset management system to reflect the 

current status.

OTS plans to conduct a complete inventory in 

the April/May 2011 timeframe of all its 

accountable property. Once that effort is 

completed, OCC will enter the appropriate 

assets in its asset management system for 

continued accountability.

Each contract, agreement, lease, license, permit, and 

similar arrangement relating to property transferred to 

Transferring Contracts (Sec. 5.4., p. 27) The Plan conforms to the 

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 54

Title III Requirements Joint Implementation Plan Sections OIG Analysis

OCC or FDIC by this section shall be transferred to 

OCC or FDIC, as appropriate, together with the 

property to which it relates. (323(c))

OTS recently updated and verified inventories 

of all open and active leases of real and 

personal property, purchase orders, and 

contracts. 

OTS leases, purchase orders, and contracts 

will transfer to OCC; FDIC does not anticipate 

assuming responsibility for any OTS leases, 

contracts, or purchase orders

OCC’s acquisition management staff will 

review all active actions to identify and 

address any redundancies and will work with 

OTS to determine which contracts provide 

OCC the best support and represent the best 

value.

OCC’s administrative and internal law 

department staff will review contract 

modification actions for legal sufficiency, as 

necessary. 

Property identified for transfer shall not be altered, 

destroyed, or deleted before transfer. (323(d))

The plan does not address this provision. We do not consider this a 

significant omission.

Section 324. Funds Transferred.

The funds that, on the day before the transfer date, 

OTS (in consultation with OCC, FDIC, and FRB) 

determines are not necessary to dispose of the affairs 

of OTS and are available to OTS to pay OTS 

expenses relating to the OTS functions transferred 

shall be transferred to OCC, FDIC, and FRB, as the 

case may be, on the transfer date. (324)

Transfer of Funds (Sec. 4., pp. 23-24)

OTS, OCC, FRB, and FDIC established a 

workgroup to address the transfer of remaining 

funds that are not necessary to dispose of 

OTS’s affairs.

The funds remaining on the day prior to 

transfer will remain available to OTS for its 

expenses relating to the agency’s functions 

that are transferred.

On the transfer date, all OTS account balances 

The Plan conforms to the 

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 55

Title III Requirements Joint Implementation Plan Sections OIG Analysis

will be transferred to OCC. The agency 

location code and associated fund symbols will 

remain open at the Department of the Treasury 

pending clearance of all outstanding 

transactions.

FDIC determined that no funds will be 

transferred from OTS to FDIC.

FRB determined that no funds will be

transferred from OTS to FRB.

Section 325. Disposition of Affairs.

During the 90-day period beginning on the transfer 

date, the OTS Director shall, solely for the purpose of 

winding up the affairs of OTS relating to any function 

transferred to OCC, FDIC, or FRB:

manage the employees of OTS who have not yet 

been transferred and provide for the payment of 

the compensation and benefits of the employees 

that accrue before the date on which the 

employees are transferred;

manage any property of OTS, until the date on 

which the property is transferred;

take any other action necessary to wind up the 

affairs of OTS;

exercise any authority vested in the OTS Director 

on the day before the transfer date, only to the 

extent necessary to wind up OTS; and

exercise any authority vested in the OTS Director 

on the day before the transfer date, only to the 

extent necessary to carry out the transfer during 

such 90-day period. (325(a) and 325(b))

Disposition of OTS Affairs (Sec. 6.3., p. 28)

The Acting OTS Director and a small cadre of 

staff will make a final disposition of the affairs 

of OTS during the 90-day period after the 

transfer date. 

OTS will use this period to ensure a full and 

accurate accounting and transfer of all OTS 

assets.

OTS will ensure that compensation and 

benefits owed to OTS employees are provided,

and prudently manage any remaining assets 

until transferred. 

OTS intends to take necessary actions to 

ensure an appropriate disposition of its affairs 

and document the measures taken to wind 

down the agency.

The Plan conforms to the 

section.
Appendix 2

Summary of Title III Requirements and the Joint Implementation Plan with OIG Analysis

Review of the Joint Implementation Plan for the Transfer of Office of Thrift Supervision Functions Page 56

Title III Requirements Joint Implementation Plan Sections OIG Analysis

The OTS Director shall, during the 90-day period 

beginning on the transfer date, continue to be treated 

as an officer of the United States. Additionally, the 

OTS Director will continue to be entitled to receive 

compensation at the same annual rate of basic pay 

that the OTS Director received on the day before the 

transfer date. (325(b)(2))

The Plan does not address this requirement. We do not consider this a 

significant omission.

Section 326. Continuation of Services.

Any agency, department, or other instrumentality of 

the United States, and any successor to any such 

agency, department, or instrumentality, that was, 

before the transfer date, providing support services 

to OTS in connection with functions transferred to 

OCC, FDIC, or FRB shall:

continue to provide such services, subject to 

reimbursement by OCC, FDIC, or FRB, until the 

transfer of functions under this title is complete; 

and 

consult with OCC, FDIC, or FRB, as appropriate, 

to coordinate and facilitate a prompt and orderly 

transition. (326)

The Plan does not address this requirement.

Section 326 is directed towards agencies, 

departments, or other instrumentalities of the 

United States providing support services to OTS 

regarding the transfer of functions – not to OCC, 

FDIC, or FRB.

We do not consider this a 

significant omission.
Appendix 3

Pay Structures

Review of the Joint Implementation Plan for the Transfer of Page 57

Office of Thrift Supervision Functions

This appendix presents a description of the pay structures of 

the Office of Thrift Supervision (OTS), Office of the Comptroller 

of the Currency (OCC), and Federal Deposit Insurance 

Corporation (FDIC), and OCC’s planned new pay band for 

certain transferred OTS employees.

OTS Pay Structure

OTS has a 30-grade pay system, with grades 25 to 30 regarded 

as the executive level. Salary ranges include a minimum, 

midpoint, and maximum. Salary structures are adjusted to 

reflect geographic differences in the cost of living. OTS 

considers the employee’s full salary as base pay for all 

compensation computations.

OCC Pay Structure

OCC has a nine-band pay system, with bands VIII and IX 

regarded as the executive level. Minimum and maximum salaries 

are set within each band, and salaries are adjusted based on 

merit. OCC considers the band salaries as base pay and 

separately uses geographic pay differentials when OCC finds 

significant differences in living and/or labor costs for various 

metropolitan areas. Benefit computations include base pay plus 

any geographic differential. 

New OCC Pay Band for Certain Transferred OTS Employees

OCC created a new pay band (NB-V-T) for OTS examiners 

having the examiner III title and at the TG-18 OTS grade 

level. The salary ranges ($56,032-$102,036) for both the 

new OCC pay band and OTS’s TG-18 grade level are 

identical. OTS transferees who are placed in the NB-V-T pay 

band will be eligible to receive special increases consistent 

with OCC policy. They will also move to the full NB-V pay 

band salary range ($64,400 - $119,900) when they earn a 

National Bank Examiner commission, which is a requirement 

at the NB-V level. In addition, they will receive a $3,000 

bonus if they successfully complete the commissioning 

process on the first attempt. Alternatively, NB-V-T examiners 

can compete for NB-V bank examiner positions in large 

banks or policy without acquiring a National Bank Examiner 

commission, if they possess sufficient specialty expertise.
Appendix 3

Pay Structures

Review of the Joint Implementation Plan for the Transfer of Page 58

Office of Thrift Supervision Functions

FDIC Pay Structure

FDIC has a 15-grade corporate grade (CG) structure for nonsupervisory employees; two corporate manager (CM) pay bands 

for supervisory and managerial employees; a corporate expert 

(CX) pay band for senior, non-supervisory and managerial 

employees; and an executive management (EM) pay band for 

executive level employees. Minimum and maximum salaries are 

set for each grade/pay band. FDIC salaries include two 

components, base salary and a locality pay adjustment. Benefits 

computations are based on base pay plus locality pay. FDIC 

negotiates pay and benefits with its employee union, and pay 

and benefits for its bargaining unit employees are typically 

covered by multi-year negotiated compensation.
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 59

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 60

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 61

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 62

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 63

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 64

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 65

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 66

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 67

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 68

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 69

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 70

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 71

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 72

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 73

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 74

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 75

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 76

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 77

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 78

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 79

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 80

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 81

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 82

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 83

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 84

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 85

Office of Thrift Supervision Functions 
Appendix 4

Joint Implementation Plan

Review of the Joint Implementation Plan for the Transfer of Page 86

Office of Thrift Supervision Functions 
Appendix 5

FRB Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 87

Office of Thrift Supervision Functions
Appendix 6

FDIC Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 88

Office of Thrift Supervision Functions
Appendix 7

OCC Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 89

Office of Thrift Supervision Functions
Appendix 7

OCC Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 90

Office of Thrift Supervision Functions
Appendix 7

OCC Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 91

Office of Thrift Supervision Functions
Appendix 8

OTS Management Comments

Review of the Joint Implementation Plan for the Transfer of Page 92

Office of Thrift Supervision Functions
Appendix 9

Major Contributors to This Report

Review of the Joint Implementation Plan for the Transfer of Page 93

Office of Thrift Supervision Functions

Board of Governors of the Federal Reserve System OIG

Timothy Rogers, OIG Manager

John Ayers, Senior Auditor and Project Lead

Jonathan Park, Auditor

Federal Deposit Insurance Corporation OIG

A. Michael Stevens, Evaluator-in-Charge

Department of the Treasury OIG

Susan Barron, Audit Director

Amni Samson, Audit Manager

Alicia Bruce, Auditor-in-Charge

Katherine Bustell, Auditor

Daniel Gerges, Auditor

John Tomasetti, Auditor

James Lisle, Referencer
Appendix 10

Report Distribution

Review of the Joint Implementation Plan for the Transfer of Page 94

Office of Thrift Supervision Functions

Board of Governors of the Federal Reserve System

Chairman

Federal Deposit Insurance Corporation

Chairman

Department of the Treasury

Deputy Secretary of the Treasury

Office of Strategic Planning and Performance Management

Office of Accounting and Internal Control

Office of the Comptroller of the Currency 

Acting Comptroller of the Currency

Liaison Officer

Office of Thrift Supervision

Acting Director

Liaison Officer

Office of Management and Budget

OIG Budget Examiner

United States Senate

Chairman and Ranking Member

Committee on Banking, Housing, and Urban Affairs

U.S. House of Representatives

Chairman and Ranking Member

Committee on Financial Services

U.S. Government Accountability Office

Comptroller General of the United States