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Overview

Mission Statement

To supervise savings associations and their holding companies in order to maintain their safety 

and soundness and compliance with consumer laws and to encourage a competitive industry that 

meets America’s financial services needs.

Program Summary by Budget Activity

Dollars in Thousands

FY 2010 FY 2011 FY 2012 Change FY10 to FY12

Actual Estimated 1/ Estimated $ Change % Change

 Supervision of the Thrift Industry $232,047 $253,605 $0 ($232,047) (100.0%)

Total Resources $232,047 $253,605 $0 ($232,047) (100.0%)

Total FTE 1,016 1,021 0 (1,016) (100.0%)

FY 2011 Priorities

• Maintain a focus on the mission of examining, supervising, and regulating thrifts and 

their holding companies and service providers:

o Provide regulatory guidance to thrifts and holding companies.

o Resolve any outstanding issues and complete projects (in preparation for 

transition).

o Streamline internal processes (in preparation for transition and consideration of 

limited resources).

• Continue to have appropriate communications with OTS staff and OTS-regulated 

institutions regarding the future.

• Effectively manage OTS property, people, information, and monetary resources.

• Provide OTS staff with opportunities to succeed in the post transition environment.

• Partner with the other financial regulators to coordinate a seamless transition of 

institutions, and resources to the future regulatory agency structures.

• Manage internal processes to provide an orderly transition of institutions and resources, 

in a manner that ensures equitable treatment of staff.

(1) The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and 

transfers the functions of the Office of Thrift Supervision in Fiscal Year 2011. 
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Table of Contents

Overview........................................................................................................................................ 1

Mission Statement....................................................................................................................... 1

Program Summary by Budget Activity....................................................................................... 1

Section 1 – Purpose ....................................................................................................................... 3

1A – Description of Bureau Vision and Priorities ...................................................................... 3

Section 2 – Budget Adjustments and Appropriation Language............................................... 4

2.2 – Operating Levels Table ...................................................................................................... 4

Section 3 – Budget and Performance Plan ................................................................................. 5

3.1 – Budget by Strategic Outcome ............................................................................................ 5

3.2.1 Supervision of the Thrift Industry Budget and Performance Plan..................................... 6
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Section 1 – Purpose

1A – Description of Bureau Vision and Priorities

The Office of Thrift Supervision (OTS) was established by Congress as a bureau of the 

Department of the Treasury pursuant to the Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989, Public Law 101-73. In July 2010, Congress passed and the President 

signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 

(Dodd-Frank Act), abolishing and transferring the functions of the Office of Thrift Supervision 

in Fiscal Year 2011.

OTS charters, examines, supervises, and regulates federal savings associations insured by the 

Federal Deposit Insurance Corporation (FDIC). OTS also examines, supervises, and regulates 

state-chartered, FDIC-insured savings associations and provides for the registration, 

examination, and supervision of savings association affiliates and holding companies. OTS sets 

capital standards for Federal and State savings associations and reviews applications of statechartered savings associations for conversion to federal thrifts. Under the Dodd-Frank Act, the 

supervision of federal savings associations is transferred to the Office of the Comptroller of the 

Currency (OCC), supervision of savings association holding companies is transferred to the 

Federal Reserve, and supervision of state charted savings associations is transferred to the FDIC 

and its consumer financial protection function to the Bureau of Consumer Financial Protection 

(CFPB).

OTS receives no appropriated funds from Congress. Income of the bureau is derived principally 

from assessments on savings associations and their holding companies, examination fees, and 

interest on investments in U.S. Government obligations. As of September 30, 2010, the OTS 

regulated 741 thrifts with total assets of $928 billion. The OTS also supervises 436 holding 

company enterprises with approximately $4.2 trillion in U.S. domiciled consolidated assets. 

These enterprises owned 398 thrifts with total assets of $717 billion or 77 percent of total thrift 

industry assets.
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Section 2 – Budget Adjustments and Appropriation Language

2.2 – Operating Levels Table

Dollars in Thousands

Office of Thrift Supervision FY 2010 Obligated FY 2011 Estimated 1/ FY 2012 Estimated

FTE 1,016 1,021 -

Object Classification

11.1 - Full-time permanent $119,225 $117,711 $0

11.3 - Other than full-time permanent $947 $8,906 $0

11.8 - Special personal services 

payments $18,756 $1,497 $0

12 - Personnel benefits $62,206 $73,636 $0

13 - Benefits for former personnel $300 $213 $0

21 - Travel and transportation of 

persons $16,943 $16,998 $0

22 - Transportation of things $238 $339 $0

23.2 - Rental payments to others $4,405 $4,945 $0

23.3 - Communication, utilities, and 

misc charges $3,296 $4,313 $0

24 - Printing and reproduction $159 $216 $0

25.1 - Advisory and assistance 

services $2,218 $2,981 $0

25.2 - Other services $2,724 $3,000 $0

25.3 - Other purchases of goods and 

services from Govt. accounts $5,986 $5,668 $0

25.4 - Operation and maintenance of

facilities $5,725 $5,851 $0

25.7 - Operation and maintenance of 

equip $454 $622 $0

25.8 - Subsistence and support of 

persons $0 $35 $0

26 - Supplies and materials $2,019 $2,155 $0

31 - Equipment $3,048 $3,324 $0

32 - Land and structures $1,193 $1,195 $0

Total Budget Authority $232,047 $253,605 $0

Budget Activities

Supervision of the Thrift Industry $232,047 $253,605 $0

Total Budget Authority $232,047 $253,605 $0

(1) The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and 

transfers the functions of the Office of Thrift Supervision in Fiscal Year 2011. 
OTS - 5

Section 3 – Budget and Performance Plan

This table lists all FY 2012 resources by strategic goal, objective and outcome outlined in the FY 

2007-2012 Treasury Department Strategic Plan. The Treasury Strategic Plan provides a 

description of what the agency intends to accomplish over the next five years.

For detailed information about the FY 2007-2012 Treasury Strategic Plan, please go to: 

http://www.treasury.gov/about/budget-performance/strategic-plan/Pages/index.aspx

3.1 – Budget by Strategic Outcome

Dollars in Thousands

Treasury Strategic Outcome FY 2010 

Enacted

FY 2011 

Estimated 1/

FY 2012 

Estimated

Percent 

Change

 Strong U.S. economic competitiveness 23,205 25,360 - -100.00%

 Prevented or mitigated financial and economic crises 208,042 228,245 - -100.00%

Total $232,047 $253,605 $0 -100.00%

3A - Supervision of the Thrift Industry ($253,605): On December 9, 1996, the FFIEC 

adopted the CAMELS rating system (Capital adequacy, Asset quality, Management, Earnings, 

Liquidity and Sensitivity to market risk) as the internal rating system to be used by the federal 

and state regulators for assessing the safety and soundness of financial institutions on a uniform 

basis. The CAMELS rating system puts increased emphasis on the quality of risk management 

practices. OTS assigns a composite CAMELS rating to savings associations at each 

examination. OTS adjusts the level of supervisory resources devoted to an association based on 

the composite rating. The CAMELS rating is based upon a scale of 1 through 5 in increasing 

order of supervisory concern.

The FFIEC first approved a uniform, interagency compliance rating system in 1980. The rating 

system reflects, in a comprehensive and uniform fashion, the nature and extent of a savings 

association’s compliance with consumer protection statutes, regulations and requirements. The 

Compliance Rating System is based upon a scale of 1 through 5 in increasing order of 

supervisory concern.

OTS elected to combine safety and soundness and compliance examinations to attain exam 

efficiencies and to improve risk assessment. Using comprehensive exam procedures, compliance 

with consumer protection laws is reviewed at more frequent intervals, which has improved the 

quality of the examination process.

Capital absorbs losses, promotes public confidence and provides protection to depositors and the 

FDIC insurance fund. Capital provides a financial cushion that can allow a savings association 

to continue operating during periods of loss or other adverse conditions. The Federal Deposit 

Insurance Act established a system of prompt corrective action (PCA) that classifies insured 

depository institutions into five categories (well-capitalized; adequately capitalized; 

undercapitalized, significantly undercapitalized; and critically undercapitalized) based on their 

relative capital levels. The purpose of PCA is to resolve the problems of insured depository 

institutions at the least possible long-term cost to the deposit insurance fund.

(1) The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and 

transfers the functions of the Office of Thrift Supervision in Fiscal Year 2011. 
OTS - 6

OTS examines savings associations every 12-18 months for safety and soundness, and 

compliance with consumer protection laws. OTS performs safety and soundness examinations 

of its regulated savings associations consistent with statutory authority. When OTS identifies 

safety and soundness or compliance issues during its risk-focused examinations, it acts promptly 

to ensure association management and directors institute corrective actions to address 

supervisory concerns. OTS staff often meets with the savings association’s board of directors 

after delivery of the Report of Examination to discuss findings and recommendations.

Beginning in FY 2006, OTS included a performance measure that reflects the efficiency of its 

operations while meeting the increasing supervisory demands of a growing and more complex 

thrift industry. This measure supports OTS’ ongoing efforts to efficiently use agency resources. 

The efficiency measure is impacted by the relative size of the savings associations regulated. 

Approximately 60 percent of all savings associations have total assets of less than $250 million 

and are generally community-based organizations that provide retail financial services in their 

local markets. The measure does not include the assets of the holding company enterprises 

regulated by OTS.

3.2.1 Supervision of the Thrift Industry Budget and Performance Plan

Supervision of the Thrift Industry Budget Activity

Resource Level FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Estimated 1/ Estimated

 Appropriated Resources $0 $0 $0 $0 $0

 Reimbursable Resources $245,699 $233,571 $232,047 $253,605 $0

Total Resources $245,699 $233,571 $232,047 $253,605 $0

Budget Activity Total $245,699 $233,571 $232,047 $253,605 $0

Measure FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Actual Actual Actual Target Target

Percent of Safety and Soundness Exams Started as 

Scheduled (Ot)

94.0 94.0 97.0 90.0 Disc

Percent of Thrifts that are Well Capitalized (Oe) 98.4 97.0 95.0 95.0 Disc

Percent of Thrifts with Composite CAMELS Ratings of 1 or 2 

(%) (Oe)

90.0 84.0 77.0 80.0 Disc

Percent of Thrifts with a Compliance Examination Ratings of 

1 or 2 (Oe)

95.8 95.0 92.0 90.0 Disc

Total OTS Costs Relative to Every $100,000 in Savings 

Association Assets Regulated (E)

15.1 19.88 24.01 24.0 Disc

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, M - Management/Cust. Satisfaction, 

DISC - Discontinued, and B - Baseline

(1) The Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203 (Dodd-Frank Act), abolishes and 

transfers the functions of the Office of Thrift Supervision in Fiscal Year 2011. 
OTS - 7

Percent of Safety and Soundness Exams Started as Scheduled - OTS examines savings 

associations every 12-18 months for safety and soundness, and compliance with consumer 

protection laws. OTS performs safety and soundness examinations of its regulated savings 

associations consistent with statutory authority. When OTS identifies safety and soundness or 

compliance issues during its risk-focused examinations, it acts promptly to ensure association 

management and directors institute corrective actions to address supervisory concerns. OTS 

staff often meets with the savings association’s board of directors after delivery of the Report of 

Examination to discuss findings and recommendations.

Percent of Thrifts That Are Well Capitalized - Capital absorbs losses, promotes public 

confidence and provides protection to depositors and the FDIC insurance fund. Capital provides 

a financial cushion that can allow a savings association to continue operating during periods of 

loss or other adverse conditions. The Federal Deposit Insurance Act established a system of 

prompt corrective action (PCA) that classifies insured depository institutions into five categories 

(well-capitalized; adequately capitalized; undercapitalized, significantly undercapitalized; and 

critically undercapitalized) based on their relative capital levels. The purpose of PCA is to 

resolve the problems of insured depository institutions at the least possible long-term cost to the 

deposit insurance fund.

Percent of Thrifts With Compliance Examination Ratings of 1 or 2 - The FFIEC first approved a 

uniform, interagency compliance rating system in 1980. The rating system reflects, in a 

comprehensive and uniform fashion, the nature and extent of a savings association’s compliance 

with consumer protection statutes, regulations and requirements. The Compliance Rating 

System is based upon a scale of 1 through 5 in increasing order of supervisory concern. OTS 

combines safety and soundness and compliance examinations to attain exam efficiencies and to 

improve risk assessment.

Percent of Thrifts With Composite CAMELS Ratings of 1 or 2 - On December 9, 1996, the 

FFIEC adopted the CAMELS rating system (Capital adequacy, Asset quality, Management, 

Earnings, Liquidity and Sensitivity to market risk) as the internal rating system to be used by the 

federal and state regulators for assessing the safety and soundness of financial institutions on a 

uniform basis. The CAMELS rating system puts increased emphasis on the quality of risk 

management practices. OTS assigns a composite CAMELS rating to savings associations at 

each examination. OTS adjusts the level of supervisory resources devoted to an association 

based on the composite rating. The CAMELS rating is based upon a scale of 1 through 5 in 

increasing order of supervisory concern.

For detailed information about each performance measure, including definition, verification and 

validation, please go to: http://www.treasury.gov/offices/management/dcfo/accountabilityreports/