I.

MANAGEMENT’S

DISCUSSION AND ANALYSIS
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 27 

Overview

During 2023, the FDIC continued to fulfill its mission-critical responsibilities. The agency 

managed the resolution and receivership of five bank failures, including the second, third, 

and fourth largest bank failures in United States history. The FDIC finalized several rules, 

some in conjunction with other agencies, and published several notices of proposed 

rulemakings in the Federal Register seeking public comment. The FDIC also engaged in 

initiatives to understand and address financial risks that climate change may cause, and 

continued to engage in several community banking and community development initiatives.

To address cyber fraud and financial crimes, the FDIC undertook a number of initiatives in 

2023 to protect the banking industry from criminal financial activities. This Annual Report

highlights these and other accomplishments achieved during the year. 

Action Plan for a Safe, Fair and Inclusive 

Work Environment

The FDIC has no higher priority than ensuring that every person at the FDIC feels safe, valued, 

and respected. Maintaining a strong workplace culture is essential to effectively carrying out 

our agency mission. Since November 2023, following news reports about sexual harassment 

at the FDIC, the FDIC’s senior leadership team developed and began implementing a 

comprehensive Action Plan for a Safe, Fair, and Inclusive Work Environment (Action Plan) that 

encompasses eight action areas and 34 specific initiatives. The eight action areas are related 

to providing support to victims and survivors, identifying and correcting current problems, 

repercussions for those engaged in sexual harassment or other serious misconduct, leadership 

accountability, review of policies and procedures, training programs, communication and 

outreach strategies, and cultural transformation. 

The Action Plan goes beyond agency compliance efforts and describes how the FDIC will 

support victims and survivors of harassment and discrimination. It reflects contributions 

from the FDIC’s senior leadership team and incorporates input from a range of stakeholders, 

including the Diversity and Inclusion Executive Advisory Council, personnel in the Office of 

Minority and Women Inclusion, and several employee resource groups. Since developing the 

Action Plan, the FDIC has collaborated closely with the National Treasury Employees Union 

(NTEU) to ensure their active participation while executing the Action Plan. 

We believe that the initiatives outlined in the Action Plan will make a meaningful difference 

in the FDIC’s workplace environment and culture. The Action Plan is intended to be a living 

document that will evolve and improve as we assess our efforts and make progress in these 

areas. We are fully committed to this important effort and look forward to communicating 

progress to our employees and the public. 

In addition, the FDIC Board of Directors established a Special Committee to oversee an 

independent third-party review of the agency’s workplace culture and appointed Directors 

Jonathan McKernan and Michael J. Hsu to co-chair the Special Committee. In December, 

the committee selected the law firm of Cleary Gottlieb Steen & Hamilton LLP to conduct the 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 28 

independent review, which will cover allegations of sexual harassment and interpersonal 

misconduct at the FDIC, including allegations of hostile, abusive, unprofessional, or 

inappropriate conduct, and management’s response to that harassment and misconduct. 

The review will also assess the FDIC’s workplace culture, including any practices that might 

discourage or otherwise deter the reporting of, or appropriate response to, harassment and 

interpersonal misconduct. 

The findings and recommendations of the third-party review will be incorporated into the 

Action Plan as appropriate. 

Deposit Insurance

As the insurer of bank and savings association deposits, the FDIC must continually evaluate 

and effectively manage how changes in the economy, financial markets, and banking system 

affect the adequacy and the viability of the DIF.

Long-Term Comprehensive Fund Management Plan

In 2010, the FDIC developed a comprehensive, long-term DIF management plan to reduce the 

effects of cyclicality and achieve moderate, steady assessment rates throughout economic 

and credit cycles, while also maintaining a positive fund balance, even during a banking crisis.

Under this plan, to increase the probability that the fund reserve ratio (the ratio of the fund 

balance to estimated insured deposits) would reach a level sufficient to withstand a future 

crisis, the FDIC Board set the Designated Reserve Ratio of the DIF at 2.0 percent. The FDIC 

views the 2.0 percent Designated Reserve Ratio as a long-term goal and the minimum level 

needed to reduce the likelihood that the FDIC would need to consider a potentially procyclical assessment rate increase and to sufficiently withstand future crises. The Federal 

Deposit Insurance (FDI) Act requires the Board to set the Designated Reserve Ratio before 

the beginning of each calendar year. In November 2023, the Board voted to maintain the 2.0 

percent ratio for 2024. 

Additionally, as part of the long-term DIF management plan, the FDIC suspended assessment 

dividends indefinitely when the fund reserve ratio exceeds 1.5 percent. In lieu of dividends, 

progressively lower assessment rates will become effective when the reserve ratio exceeds 2.0 

percent and 2.5 percent.

State of the Deposit Insurance Fund

The DIF balance declined to $121.8 billion as of December 31, 2023, primarily due to loss 

provisions for the five bank failures during the year. The increase in provision expenses was 

partially offset by an increase in assessment revenue and interest earned, and an unrealized 

gain on securities. Following the failure of two large banks in March 2023 (Refer to the Section 

on Failure Resolution and Receivership Management), the banking industry experienced 

outflows of total deposits, but also experienced strong insured deposit growth. This growth 

in insured deposits, coupled with the decline in the DIF balance, resulted in a decline in the 

fund reserve ratio to 1.13 percent as of September 30, 2023, 10 basis points lower than the 

prior year. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 29 

Special Assessment Pursuant to the Systemic Risk Determination

In May 2023, the FDIC Board of Directors approved a notice of proposed rulemaking (NPR) 

to impose a special assessment to recover the loss to the DIF arising from the protection of 

uninsured depositors in connection with the systemic risk determinations announced on 

March 12, 2023, following the closures of Silicon Valley Bank and Signature Bank. In November 

2023, the FDIC Board adopted a final rule implementing the special assessment.

As of December 31, 2023, the FDIC estimates the cost for the failures of Silicon Valley Bank and 

Signature Bank to be $21.8 and $1.8 billion, respectively. Of the estimated total cost of $23.6 

billion, the FDIC estimates that approximately $20.4 billion was attributable to the cost of 

covering uninsured deposits as a result of the systemic risk determination. 

The FDI Act requires that the loss to the DIF arising from the use of a systemic risk 

determination must be recovered from one or more special assessments on insured 

depository institutions (IDIs), depository institution holding companies, or both. Therefore, by 

statute, the FDIC is required to recover the $20.4 billion estimated loss through one or more 

special assessments.

The special assessment will be paid by banking organizations with at least $5 billion in 

uninsured deposits for the December 31, 2022 reporting period. Under the final rule, the FDIC 

anticipated that the special assessment would be collected at an annual rate of approximately 

13.4 basis points over an initial eight quarterly assessment periods, beginning with the first 

quarterly assessment period of 2024. Because the estimated loss pursuant to the systemic 

risk determination will be periodically adjusted as assets are sold, liabilities are satisfied, and 

receivership expenses are incurred, and because assessments collected may change due to 

corrective amendments to the amount of uninsured deposits reported for the December 31, 

2022 reporting period, the FDIC may cease collection early, extend the special assessment 

collection period, or impose a final shortfall special assessment after both receiverships 

have terminated.

The special assessment amount may change because estimated losses under the systemic 

risk determination will be adjusted when assets are sold, liabilities satisfied, and receivership 

expenses incurred. The amount also may change due to amendments to uninsured deposits 

reported for the December 31, 2022, reporting period. Because of these changes, the FDIC 

may stop collection early, extend the special assessment collection period, or impose a final 

shortfall special assessment after both receiverships have been terminated. 

Restoration Plan

Extraordinary growth in insured deposits during the first and second quarters of 2020 

caused the DIF reserve ratio to decline below the statutory minimum of 1.35 percent as of 

June 30, 2020. In September 2020, the FDIC Board of Directors adopted a Restoration Plan 

to restore the reserve ratio to at least 1.35 percent within eight years, absent extraordinary 

circumstances, as required by the FDI Act. The Restoration Plan maintained the assessment 

rate schedules in place at the time and required the FDIC to update its analysis and projections 

for the DIF balance and reserve ratio at least semiannually and, if necessary, recommend 

modifications to assessment rates.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 30 

In June 2022, based on projections indicating that the reserve ratio was at risk of not reaching 

the required minimum by the statutory deadline, the FDIC Board approved an Amended 

Restoration Plan, which included a uniform increase in initial base deposit insurance 

assessment rates of 2 basis points. Concurrently, the FDIC approved a notice of proposed 

rulemaking (NPR) to implement this increase in the assessment rate schedules. In October 

2022, the FDIC Board adopted a final rule implementing the assessment rate schedule increase 

with an effective date of January 1, 2023, to increase the likelihood that the DIF reserve ratio 

reaches the statutory minimum level of 1.35 percent by September 30, 2028. 

In its semiannual updates for 2023, the FDIC stated that the reserve ratio remains on track 

to reach the statutory minimum of 1.35 percent ahead of the deadline of September 30, 

2028, though the precise timing is uncertain and depends on a number of factors. Under the 

Amended Restoration Plan, the FDIC will continue to monitor insured deposit balance trends, 

potential losses that impact the DIF balance, and other factors that affect the reserve ratio.

Deposit Insurance System Options

On May 1, 2023, the FDIC published Options for Deposit Insurance Reform to place the 

developments in the banking industry in spring 2023 in the context of the history, evolution, 

and purpose of deposit insurance since the FDIC was created in 1933.

2

The report reveals that, while more than 99 percent of deposit accounts remain below the 

deposit insurance limit, growth in uninsured deposits has increased the banking system’s 

exposure to bank runs. At its peak in 2021, uninsured deposits accounted for nearly 47 

percent of domestic deposits, higher than at any time since 1949. The report argues that large 

concentrations of uninsured deposits, combined with technological changes that facilitate the 

rapid spread of information and speed of deposit withdrawals, increase the potential for bank 

runs and can threaten financial stability.

While acknowledging that deposit insurance can create moral hazard by providing an incentive 

for banks to take on greater risk, the report underscores the important role that regulation, 

supervision, and deposit insurance pricing play in helping the deposit insurance system meet 

its financial stability and depositor protection objectives while constraining moral hazard.

The report evaluates three options to reform the deposit insurance system: 

 Maintaining the current structure of Limited Coverage, including the possibility of 

an increased but clearly delineated deposit insurance limit;

 Providing Unlimited Coverage of all deposits; and 

 Providing Targeted Coverage, which would allow for higher or unlimited coverage 

for business payment accounts. 

Of these options, the report identifies Targeted Coverage as having the greatest potential for 

meeting the fundamental objectives of deposit insurance relative to its costs.

2 Options for Deposit Insurance Reform is available at https://www.fdic.gov/analysis/options-deposit-insurancereforms/index.html.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 31 

FDIC Examinations

2023 2022 2021

Risk Management (Safety and Soundness): 

State Nonmember Banks 1,125 1,202 1,139

Savings Banks 122 129 129

State Member Banks 0 0 0

Savings Associations 0 0 0

National Banks 0 0 0

Subtotal-Risk Management Examinations 1,247 1,331 1,268

CRA/Consumer Compliance Examinations:

CRA/Consumer Compliance 675 631 740

Consumer Compliance-only 181 355 358

CRA-only 5 1 2

Subtotal—CRA/Compliance Examinations 861 987 1,100

Specialty Examinations:

Trust Departments 255 305 275

IT and Operations 1,243 1,331 1,271

AML/CFT 1,255 1,343 1,285

Subtotal—Specialty Examinations 2,753 2,979 2,831

TOTAL 4,861 5,297 5,199

Supervision

Supervision and consumer protection are cornerstones of the FDIC’s efforts to ensure the 

stability of, and public confidence in, the nation’s financial system. The FDIC’s supervision 

program promotes the safety and soundness of FDIC-supervised financial institutions, 

protects consumers’ rights, and promotes community investment initiatives.

RISK MANAGEMENT EXAMINATION PROGRAM

The FDIC’s bank examination efforts are at the core of its supervisory program. As of 

December 31, 2023, the FDIC was the primary federal regulator for 2,946 FDIC-insured, statechartered institutions that were not members of the Federal Reserve System (generally 

referred to as “state nonmember” institutions). As the primary regulator of these institutions, 

the FDIC assesses each institution’s operating condition, management practices and policies, 

and compliance with applicable laws and regulations through risk management (safety and 

soundness), consumer compliance, Community Reinvestment Act (CRA), and other specialty 

examinations.

The following table shows the number of examinations by type, conducted from 2021 

through 2023.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 32 

During 2023, the FDIC conducted 1,247 statutorily required 

risk management examinations, and conducted all required 

follow-up examinations for FDIC-supervised problem 

institutions, within prescribed timeframes. The FDIC 

also conducted 861 statutorily required CRA/consumer 

compliance examinations (675 joint CRA/consumer 

compliance examinations, 181 consumer compliance-only 

examinations, and five CRA-only examinations). In addition, 

the FDIC performed 2,753 specialty examinations, including statutorily required reviews of 

compliance with Anti-Money Laundering (AML)/Countering the Financing of Terrorism (CFT)3

requirements, within prescribed timeframes.

Problem Institutions and Enforcement Actions

As of September 30, 2023, 44 insured institutions with total assets of $53.5 billion were 

designated as problem institutions (i.e., institutions with a composite rating of 4 or 5 under 

the Uniform Financial Institutions Rating System (UFIRS)

4

) for safety and soundness purposes. 

By comparison, on September 30, 2022, there were 42 problem institutions with total assets 

of $163.8 billion. This represents a five percent increase in the number of problem institutions 

and a 67 percent decrease in problem institution assets.

For the 12 months ended September 30, 2023, 16 institutions with aggregate assets of $455.2 

billion were removed from the list of problem financial institutions, while 18 institutions 

with aggregate assets of $343.7 billion were added to the list. The FDIC is the primary federal 

regulator for 26 of the 44 problem institutions, with aggregate assets of $10.6 billion.

In 2023, the FDIC’s Division of Risk Management Supervision (RMS) initiated 101 formal 

enforcement actions and 77 informal enforcement actions against supervised institutions. 

These actions included, but were not limited to, 18 actions under Section 8(b) of the FDI 

Act, one of which was a notice of charges, and 76 memoranda of understanding (MOUs). In 

addition, one Section 39 Compliance Plan and two civil money penalties (CMPs) were issued 

against institutions. Of these enforcement actions against institutions, 11 MOUs and 12 formal 

actions (nine consent orders, one notice of charges, and two CMPs) were based, in whole or 

in part, on apparent violations of AML/CFT laws and regulations. In addition, enforcement 

actions were also initiated against individuals. These actions included, but were not limited 

to, 43 removal and prohibition actions under Section 8(e) of the FDI Act (39 consent orders and 

four notices of intention to remove/prohibit), four actions under Section 8(b) of the FDI Act 

(two consent orders and two notices of charges for an order for restitution), and 16 CMPs (12 

orders to pay and four notices of assessment).

3 The Anti-Money Laundering (AML) Act of 2020 amended subchapter II of chapter 53 of title 31 United States Code (the 

legislative framework commonly referred to as the “Bank Secrecy Act” or “BSA”). For purposes of consistency with 

the AML Act, the FDIC will now use the term “AML/CFT program” rather than “BSA/AML compliance program.” Use of 

“AML/CFT” has the same meaning as the previously used “BSA/AML”.

4 Under the Uniform Financial Institutions Rating System (UFIRS), each financial institution is assigned a composite 

rating based on an evaluation of six financial and operational components, which are also rated. The component 

ratings reflect an institution’s capital adequacy, asset quality, management capabilities, earnings sufficiency, 

liquidity position, and sensitivity to market risk (commonly referred to as CAMELS ratings). Ratings range from “1” 

(strongest) to “5” (weakest).
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 33 

VOLUME OF MRBA ISSUED IN 2023 BY CATEGORY

Source: FDIC. Data through 12/31/2023.

Note: Count reflects MRBA recorded at examination-related events in 2023.

0

50

100

150

200

250

Board/

Management

Risk Lending AML/CFT

Management

Information

Technology

Sensitivity to

Market Risk

Liquidity Earnings Capital Trust Securities

Portfolio

233

96

85

66 60 59

37 33

8 2

88

EXAMINATION PROCESSES

The FDIC engages in risk-focused, forward-looking supervision by assessing risk management 

practices during the examination process to address risks before they lead to financial 

deterioration. Examiners make supervisory recommendations, including Matters Requiring 

Board Attention (MRBA), in Reports of Examination (ROE) and other examination-related 

communications to address these risks. RMS met its goal of following up on at least 90 percent 

of MRBA within six months of the transmittal of the ROE. Through December 31, 2023, 767 

MRBA items were recorded, with the most common MRBA addressing Board and management 

concerns, risk management, lending-related matters, liquidity and IT weaknesses. 

Point-in-Time Examinations

Approximately 98 percent of all FDIC-supervised institutions are examined through point-intime examinations. By law, risk management point-in-time examinations are conducted every 

12 months, which can be extended to 18 months under certain circumstances, generally on an 

alternating basis with the appropriate state banking department. 

Continuous Examinations

The remaining FDIC-supervised institutions (53 for 2023) are examined under a continuous 

examination process. The continuous examination process includes on-site targeted reviews 

of areas the examiner determines are necessary to complete a full-scope examination; 

ongoing monitoring and assessment of an institution’s risks, policies, procedures, and 

financial condition; and frequent communication with institution management. Supervisory 

letters are issued to the institution’s board and management after each targeted review to 

convey examiner findings. Additionally, at the end of the continuous examination cycle, an 

ROE that aggregates examination and other supervisory activities performed throughout the 

cycle is issued to the institution.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 34 

Off-Site Monitoring

The FDIC utilizes off-site monitoring programs to supplement and guide the examination 

process. The FDIC has developed a number of off-site monitoring tools and programs 

incorporating data from institutions’ quarterly Reports of Condition and Income, or Call 

Reports. These programs provide a “line of sight” between examinations into institutions that 

may be vulnerable to challenging economic conditions or reporting financial performance 

metrics outside of normal operating parameters. 

Off-site tools identify institutions that may be experiencing rapid asset growth, elevated levels 

of unrealized holding losses on securities, low levels of liquidity, or sensitivity to interest rate 

movements, to name a few. 

Off-site monitoring for banks with total assets greater than $10 billion includes the quarterly 

Large Insured Depository Institution (LIDI) Program, which remains the primary instrument 

for off-site monitoring of the largest institutions supervised by the FDIC. The LIDI Program 

provides a comprehensive process to standardize data capture and reporting for large and 

complex institutions nationwide, allowing for quantitative and qualitative risk analysis.

The LIDI Program focuses on institutions’ potential vulnerabilities to asset, funding, and 

operational stresses. It supports effective large bank supervision by using individual 

institution information to focus resources on higher-risk areas, determine the need for 

supervisory action, and support insurance assessments and resolution planning. In 2023, the 

LIDI Program covered 118 institutions with total assets of $4.4 trillion.

Off-site programs that were enhanced in March 2022 identified institutions with heightened 

exposure to interest rate risks, such as those with elevated levels of unrealized holding losses 

on securities, and liquidity and funding weaknesses, requiring follow-up communication with 

bank management. Enhanced ongoing risk monitoring in the areas of interest rate, liquidity, 

and funding risks continued throughout 2023.

In addition to these quarterly off-site monitoring efforts, RMS engaged in heightened 

monitoring of banks vulnerable to liquidity stress during the spring of 2023. These efforts 

included daily communication with bank management teams about liquidity positions and 

strategies and in some cases led to accelerated examinations or visitations, supervisory 

recommendations or enforcement actions, and ratings changes.

The FDIC also increased its off-site monitoring of commercial real estate (CRE) lenders this 

year. In 2023, the operating environment for CRE lenders included economic uncertainty, 

interest rate increases, and material changes in office sector usage patterns leading to higher 

vacancy rates, which led to the softening of property values. FDIC staff contacted a group of 

institutions examined under the point-in-time process to collect a representative sample of 

community banks’ CRE loan portfolio composition, loan risk ratings, collateral values, loan 

maturity timeframes, and credit underwriting trends. During these contacts, staff assessed 

the level and trend of risk related to institutions’ CRE loan portfolios. FDIC staff also leveraged 

the continuous examination process to more closely monitor CRE loan risk ratings, loan 

maturity timeframes, and the types of CRE properties more vulnerable to current economic 

conditions. RMS is using the findings from these activities to influence supervisory strategies 

at these institutions. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 35 

Shared National Credit Program

The Shared National Credit (SNC) Program is an interagency initiative administered jointly 

by the FDIC, Office of the Comptroller of the Currency (OCC), and Board of Governors of the 

Federal Reserve System (FRB) to promote consistency in the regulatory review of large, 

syndicated credits, as well as to identify risks in this market, which comprises a large volume 

of domestic commercial lending. 

In 2023, outstanding credit commitments in the SNC Program totaled $6.4 trillion. The FDIC, 

OCC, and FRB reported the results of their review in a joint public statement in February 2023 

that covered the 2022 examination results and reported overall moderate risk. The agencies 

also reported, however, that the results did not reflect the full impact of rising interest rates 

and softening economic conditions.

SPECIALTY EXAMINATIONS

The FDIC conducts applicable specialty examinations as part of the risk management 

examination of each institution. Specialty examination findings and the ratings assigned to 

those areas are taken into consideration, as appropriate, when assigning component and 

composite examination ratings under the UFIRS.

5

Trust/Registered Transfer Agent (RTA)/Municipal Securities Dealer/Government 

Securities Dealer Examinations

The FDIC examines trust, RTA, municipal securities dealer, and government securities dealer 

risk management practices at institutions that engage in these activities. As of December 

31, 2023, the FDIC had performed 250 trust and five RTA examinations. Of the 250 trust 

examinations, 27 were related to entities in the continuous examination program.

Information Technology and Cybersecurity Examinations

The FDIC examines IT risk management practices, including cybersecurity, at each risk 

management examination. Examiners assign an IT rating using the Federal Financial 

Institutions Examination Council (FFIEC) Uniform Rating System for Information Technology. 

Throughout 2023, the FDIC conducted 1,243 IT examinations at state nonmember institutions 

and issued four formal IT-related enforcement actions. 

In September 2023, the FDIC updated its Information Technology Risk Examination (InTREx) 

procedures to provide more specific examiner instructions for assessing compliance with the 

Computer Security Incident Notification Rule, which had an effective date of April 1, 2022. 

The InTREx procedures were also updated with more detailed procedures regarding the 

review of service provider reports of examination. Examiners use these procedures to review 

information technology risk management at each safety and soundness examination.

The FDIC also examines the IT services provided to institutions by bank service providers; 

cybersecurity is included in the scope of every service provider examination. For the most 

significant service providers, the FDIC, FRB, and OCC also horizontally reviewed supply 

5 See footnote 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 36 

chain risk in 2023. The FDIC, FRB, and OCC use the Cybersecurity Examination Procedures, 

developed by the agencies, to ensure consistent evaluation of this risk.

The FDIC actively engages with both the public and private sectors to assess emerging 

cybersecurity threats and other operational risk issues. FDIC staff meet regularly with the 

Financial and Banking Information Infrastructure Committee (FBIIC), the Financial Services 

Sector Coordinating Council for Critical Infrastructure Protection and Homeland Security, the 

Department of Homeland Security, the Financial Services Information Sharing and Analysis 

Center (FS-ISAC), other regulatory agencies, and law enforcement to share information 

regarding emerging issues and to coordinate responses. In 2023, the FDIC sent financial 

institutions alerts relating to fraudulent emails appearing to be from the FDIC, the MOVEit File 

Transfer Zero Day Vulnerability, and other vulnerabilities.

The FDIC shares information obtained from these engagements with examiners. To 

support, but not replace, an institution’s threat awareness program, the FDIC amplifies 

communications from law enforcement, security, and intelligence agencies when the threats 

or vulnerabilities identified could affect a large number of financial institutions, and the 

threats or vulnerabilities could result in severe disruptions to banking services or unauthorized 

access to non-public information. Further, the banking regulators encourage institutions to 

participate in information-sharing forums such as FS-ISAC.

Anti-Money Laundering /Countering the Financing of Terrorism

The FDIC examines institutions’ compliance with AML/CFT requirements as part of each 

risk management examination. The FDIC also examines for AML/CFT compliance during 

examinations conducted by state banking authorities if the state lacks the authority or 

resources to conduct the examination. In total, during 2023, the FDIC conducted 1,255 

AML/CFT examinations.

Throughout 2023, the FDIC, FRB, OCC, National Credit Union Administration (NCUA), and U.S. 

Department of the Treasury (Treasury), including the Financial Crimes Enforcement Network 

(FinCEN), continued to focus on improving the efficiency and effectiveness of the AML/CFT 

regime by working on initiatives related to the Anti-Money Laundering Act of 2020. 

FDIC staff continued to consult with FinCEN on the Beneficial Ownership Information 

reporting required by the Corporate Transparency Act6

 and continues to work with the group 

on the AML/CFT program rule.

In August 2023, the FFIEC issued six revised sections of the FFIEC BSA/AML Examination Manual: 

 Due Diligence Programs for Correspondent Accounts for Foreign Financial 

Institutions, 

 Prohibition on Correspondent Accounts for Foreign Shell Banks; Records 

Concerning Owners of Foreign Banks and Agents for Service of Legal Process,

6 The Corporate Transparency Act (CTA) establishes uniform beneficial ownership information reporting 

requirements for certain types of corporations, limited liability companies, and other similar entities created in or 

registered to do business in the United States. The CTA authorizes FinCEN to collect that information and disclose it 

to authorized government authorities and financial institutions, subject to effective safeguards and controls.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 37 

 Reporting Obligations on Foreign Bank Relationships with Iranian-Linked 

Financial Institutions, 

 Summons or Subpoena of Foreign Bank Records; Termination of Correspondent 

Relationship; Records Concerning Owners of Foreign Banks and Agents for Service 

of Legal Process,

 Due Diligence Programs for Private Banking Accounts, and

 Special Information Sharing Procedures to Deter Money Laundering and Terrorist 

Activity.

The revisions reinforce instructions to examiners on how to evaluate depository institutions’ 

policies, procedures, and processes in determining whether they meet AML/CFT requirements 

and safeguard institutions from money laundering, terrorist financing, and other illicit 

financial activity. The manual emphasizes that examiners should tailor the AML/CFT 

examination scope and planned procedures consistent with the depository institution’s 

money laundering and terrorist financing risk profile.

The FFIEC expects to make additional updates to the Manual in 2024.

In addition, the FDIC has undertaken a number of initiatives in 2023 to protect the banking 

industry from criminal financial activities. These include planning a financial crimes-focused 

conference with the Department of Justice that will be held in 2024 for examiners, lawyers, 

and others from federal banking and law enforcement agencies; hosting an industry outreach 

webinar on ransomware trends and mitigation recommendations featuring the Federal 

Bureau of Investigation; and helping financial institutions identify and shut down “phishing” 

websites that attempt to fraudulently obtain an individual’s confidential personal or financial 

information.

CONSUMER COMPLIANCE EXAMINATION PROGRAM

In 2023, the FDIC conducted all consumer compliance and CRA examinations in accordance 

with established timeframes, implemented enforcement actions where appropriate, and 

completed all required follow-up examinations and visits to confirm that institutions had 

complied with the requirements of those corrective programs and fully addressed identified 

violations. With one exception, all follow-up examinations and visits were completed in 

accordance with the time standards prescribed by FDIC policy. 

As of December 31, 2023, 50 insured state nonmember institutions (with total collective 

assets of $71.7 billion), representing one percent of all supervised institutions, were problem 

institutions for consumer compliance, CRA, or both. All except one of the problem institutions 

for consumer compliance had a rating of “4”, and one had a rating of “5”. For CRA purposes, 

most of these banks had a “Needs to Improve” rating and only two had a “Substantial 

Noncompliance” rating. As of December 31, 2023, the FDIC performed all follow-up 

examinations for problem institutions on schedule. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 38 

Consumer compliance and CRA examination findings and the ratings assigned to those areas 

are also taken into consideration when assigning component and composite ratings under 

the UFIRS.

As of December 31, 2023, FDIC initiated 16 formal enforcement actions and 16 informal 

enforcement actions, such as Board Resolutions and MOUs, to address consumer compliance 

examination findings. These formal actions included five consent orders to strengthen 

consumer compliance management systems, one Notice of Charges for violating Small 

Business Act regulations and engaging in deceptive acts and practices in violation of Section 

5 of the Federal Trade Commission Act, and 10 civil money penalties (CMPs). The CMPs were 

issued against institutions to address violations of the Flood Disaster Protection Act, Section 

5 of the Federal Trade Commission Act for Unfair or Deceptive Acts or Practices, and Home 

Mortgage Disclosure Act. CMPs totaled approximately $474,000. 

In addition to consumer refunds resulting from the assistance provided by the FDIC’s 

Consumer Response Unit (see discussion under the Consumer Complaints and Inquiries 

section), consumer compliance examination findings prompted banks to make voluntary 

restitution of approximately $10.6 million to 130,310 consumers including Truth In Lending Act 

(TILA) reimbursements of approximately $1.7 million to 12,342 consumers. 

FOCUS and the Banker Engagement Site

The Framework for Oversight of Compliance and CRA Activities User Suite (FOCUS) replaced 

Division of Depositor and Consumer Protection (DCP)’s legacy system as the examination 

and supervision system of record on January 1, 2023. Additionally, the FDIC successfully 

completed the development and deployment of the FOCUS Pre-Examination Planning (PEP) 

module and the Banker Engagement Site (BES) in August 2023. The BES provides a secure 

portal to collaborate and exchange documents, information, and communication for PEP 

activities related to consumer compliance and CRA examinations. The PEP module and 

BES allow FDIC-supervised institutions to more effectively participate in the PEP process, 

easily respond to requests from examiners, maintain ongoing contact, and exchange ad hoc 

documents during or outside of examination activities. 

Property Appraisal and Valuation Equity

June 2023 marked the two-year anniversary of the establishment of the Interagency Task 

Force on Property Appraisal and Valuation Equity (PAVE) to address inequities in home 

appraisals. The PAVE Task Force, which consists of 13 federal agencies and offices, aims 

to evaluate the causes, extent, and consequences of appraisal bias and to establish a 

transformative set of recommendations to root out racial and ethnic bias in home valuations. 

The PAVE Action Plan outlines the affirmative steps, including a set of policy commitments 

and consumer-facing actions that the FDIC and other federal agencies will take to substantially 

reduce the prevalence and impact of racial and ethnic bias in residential property valuation. 

The FDIC has made a number of concrete commitments as a member of the Task Force. 

Since the release of the PAVE Action Plan one year ago, the FDIC closely coordinated and 

collaborated with other member agencies to fulfill the Action Plan’s commitments and 

recommendations.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 39 

EXAMINER TRAINING AND DEVELOPMENT 

In 2023, the FDIC continued to emphasize the importance 

of delivering timely and effective examiner training

programs. On-the-job training remains the most significant 

part of developmental activities; however, examiners also 

benefit from a mix of classroom, virtual instructor-led, and 

asynchronous (such as computer-based) training.

Senior and mid-level managers oversee all training and development activities to ensure 

that FDIC staff and state regulatory partners receive training that is effective, appropriate, 

and current. The FDIC collaborates with partners across the organization and at the FFIEC 

to ensure emerging risks and topics are incorporated into training and conveyed to staff. 

Training and development activities target all levels of examination staff. Experienced 

FDIC staff develops most of the examiner training courses. Tenured and knowledgeable 

internal instructors deliver most of the training, recognizing the essential role that peer-topeer knowledge transfer plays in skills enhancement and the preservation of institutional 

knowledge.

EMERGING TECHNOLOGY

The FDIC continues to dedicate significant resources to identify and understand emerging 

technology, and ensure the Corporation is prepared to address the changing landscape in 

financial services. Since 2016, these efforts have 

been led by the FDIC’s Emerging Technology 

Steering Committee, which is supported by 

two staff-level working groups. The Steering 

Committee is composed of the Directors 

of RMS, DCP, the Division of Insurance and 

Research (DIR), the Division of Resolutions 

and Receiverships (DRR), and the Division of 

Complex Institution Supervision and Resolution 

(CISR), as well as the General Counsel, Chief 

Financial Officer, Chief Innovation Officer, Chief 

Risk Officer, and Chief Information Officer. 

In addition, in 2023, the FDIC created the 

Emerging Technology Section in RMS to 

provide examination support and lead policy 

development related to emerging technologies

and the Technology Enterprise and Consumer 

Harm Risk and Innovation Section in DCP to 

expand technical knowledge and supervision 

capabilities of emerging technologies as they 

are adopted in financial services. 

Emerging Technology Steering Committee

Throughout 2023, the Steering Committee 

continued work on its established objectives to: 

 Comprehend, assess, and monitor 

the current emerging technology

activities, risks, and trends; 

 Evaluate the projected impact of 

emerging technology on the banking 

system, the deposit insurance 

system, effective regulatory

oversight, economic inclusion, and 

consumer protection; 

 Oversee internal working groups 

monitoring particular aspects of 

emerging technology; 

 Recommend follow-up actions,

as appropriate, and monitor 

implementation; and 

 Help formulate strategies to respond 

to opportunities and challenges 

presented by emerging technology

and to ensure developments align 

with regulatory goals.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 40 

These sections join the Emerging Technology & AML/

Cyber Fraud Policy Group, which was formed within 

the Office of the General Counsel in 2020. The group 

houses a team of attorneys which focuses on legal 

issues facing both the FDIC and its supervised and 

insured banks and savings associations arising from 

emerging forms of technology, including blockchain, 

tokenization of assets and liabilities, open banking, 

and artificial intelligence and machine learning.

The FDIC established FDITECH to help the agency 

adopt innovative and transformative technologies. 

The mission of FDITECH is to work across divisions 

and offices within the FDIC to address critical 

business needs through the use of new automations, 

technology innovations and process improvements. 

In 2024, FDITECH will evaluate various scenarios involving the use of distributed 

ledger technology.

RISK MONITORING

The FDIC continues to identify and monitor new and existing risks to the financial system 

through its supervision program.

Digital/Crypto-Related Activities Risk

In October 2022, the Financial Stability Oversight Council (FSOC) published a report, Report 

on Digital Asset Financial Stability Risks and Regulation,

7

 that concluded that crypto-asset 

activities could pose risks to the stability of the U.S. financial system if their interconnections 

with the traditional financial system or their overall scale were to grow without adherence 

to, or the development of, appropriate regulation, including enforcement of the existing 

regulatory structure. 

The FDIC continued to monitor and address this risk in 2023.

For example, the FDIC has developed processes to engage in 

robust supervisory discussions with banking organizations 

regarding proposed and existing crypto-asset-related 

activities, and in 2023, provided case-specific supervisory 

feedback to supervised institutions that are engaging in 

or planning to engage in these activities.

8

 Case-specific feedback focuses on assessing the 

ability of the supervised institution to perform the activity in a safe and sound manner, and in 

compliance with applicable laws and regulations, including consumer protection. Throughout 

2023, the FDIC continued to monitor and review the level of interest and adoption of cryptorelated activities by supervised institutions to inform its internal and policy work. FDIC staff 

7 https://home.treasury.gov/system/files/261/FSOC-Digital-Assets-Report-2022.pdf

8 In April, the FDIC issued FIL-16-2022, Notification of Engaging in Crypto-Related Activities, which asked supervised 

institutions to notify the FDIC if they are engaging in, or planning to engage in, crypto-asset-related activities.

FDITECH 

FDITECH has worked within the agency to: 

 Partner with DCP to pilot 

the use of machine learning 

to replace manual methods 

of collecting data during 

compliance examinations 

of FDIC-supervised 

financial institutions. 

 Partner with RMS to 

expand the use of machine 

learning to analyze 

Reports of Examination 

of individual financial 

institutions to identify risks 

across the banking sector. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 41 

also coordinated with the FRB and OCC to issue interagency statements related to cryptoassets. 

Section 18(a)(4) of the FDI Act and its implementing regulations (12 C.F.R. Part 328, Subpart B) 

prohibit any person or entity from making false or misleading representations about deposit 

insurance, using the FDIC’s name or logo in a manner that would imply that an uninsured 

financial product is insured or guaranteed by the FDIC, or knowingly misrepresenting the 

extent or manner of deposit insurance. Section 18(a)(4) gives the FDIC authority to investigate 

such violations and to enforce the prohibition against any person or entity.

In 2023, the FDIC issued nine cease-and-desist letters demanding the remediation of false and 

misleading statements regarding the FDIC insurance status of crypto-assets. These letters 

were sent to financial technology companies (fintechs) and crypto companies that made false 

statements on their websites and social media stating that cryptocurrency was FDIC-insured, 

as well as media outlets that repeated these false claims. In each instance, the recipient of the 

letter promptly remediated the misrepresentations, often within hours of the letter’s issuance.

SUPERVISION POLICY

The goal of the FDIC’s supervision policy is to provide clear, consistent, meaningful, and timely 

information to financial institutions and examiners.

During 2023, the FDIC updated several sections of the Risk Management Manual of Examination 

Policies:

 Section 3.2 was updated to clarify instructions for utilizing the Special Mention 

designation and reflecting items listed for Special Mention in ROEs; 

 Section 3.6 was updated to provide revisions for relevant accounting changes 

related to foreclosed real estate, with a focus on seller-financed Other Real Estate 

(ORE); 

 Section 14.1 was updated to incorporate various technical and clarifying edits;

 Section 16.1 provided updated instructions for reflecting items listed for Special 

Mention in the ROE and for documenting analysis of concentrations of uninsured 

deposits in the ROE; 

 Section 21.1 was renamed for clarity and the examination planning instructions 

were amended to reflect changes in terminology and examination tools, and to 

incorporate staff feedback; and

 Section 21.2 was added to provide planning instructions for continuous 

examinations, which is the process the FDIC uses to perform full-scope 

examinations over the course of a year for certain institutions that are larger, more 

complex, or present a higher risk profile. 

Credit Risk, Liquidity Risk and Interest Rate Risk

Despite the period of stress early in 2023, the banking industry has remained resilient. 

Through the end of 2023, net income was high by historical measures, asset quality metrics 

were stable, and the industry was well-capitalized. However, the banking industry still faces 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 42 

significant challenges from the effects of inflation, rising 

market interest rates, and geopolitical uncertainty.

Loan growth moderated during the year, and net chargeoff rates increased, though they remained within historical 

norms. Meanwhile, allowances for credit losses continued 

to grow, reflecting the potential for credit quality and 

profitability to weaken. In addition, CRE portfolios face 

challenges from higher interest rates when rates reset (on adjustable-rate loans) and when 

loans mature, and office properties are experiencing weak demand for space and softening 

property values. The FDIC remains watchful of risks in all lending areas posed by higher 

market interest rates.

Industry liquid assets declined through a combination of lower cash and securities balances 

and greater pledging of investments. However, most of the increase in pledging activity was 

for prudent liquidity contingency planning. Total deposits declined 4.2 percent over the year, 

but deposit outflows moderated substantially from the large outflows that resulted from 

first quarter stress associated with deposit runs on several large institutions. The decline in 

deposits has been offset by increases in wholesale funding, which contributed to increasing 

interest expenses. The upward trajectory of interest rates led to further net unrealized holding 

losses for institutions with long-duration bond portfolios. The decline in the market value of 

these securities, coupled with deposit declines, could negatively impact liquidity and access 

to funding if market interest rates continue to rise. 

Inflation and rising interest rates have also affected the industry’s sensitivity to market 

risk. Besides a significant volume of unrealized holding losses on debt securities at certain 

institutions, increasing interest rates, an inverted yield curve, and deposit outflows, have 

pushed deposit costs higher as financial institutions strive to remain competitive. While 

institutions’ net interest income generally expanded in 2023, deposit and borrowing costs 

have increased at a faster pace than asset yields, constraining bank margins. Other negative 

effects of inflation and higher interest rates include elevated overhead, a reduction in 

mortgage banking activity, and potentially increased credit costs from reduced obligor cash 

flows. The industry will continue to be challenged to maintain earnings performance, capital 

adequacy, asset quality, and liquidity under these conditions. 

Through examinations, interim contacts, and off-site monitoring, FDIC staff regularly talk 

with the management teams of state nonmember institutions about the need for effective 

credit, liquidity, and interest rate risk management. When appropriate, FDIC staff work with 

institutions that have significant exposure to these risks and encourage management teams 

to consider risk-mitigating steps. Throughout 2023, the FDIC conducted outreach and offered 

constructive feedback to help financial institutions navigate this challenging environment.

The FDIC also coordinated with other agencies on liquidity and interest rate risk management 

supervision and policy matters. As a result of the bank failures and industry stress experienced 

in the spring of 2023, the FDIC took initial steps to coordinate with the FRB and OCC to review 

existing rules and supervisory guidance in these areas. For instance, in July, the agencies 

issued a joint statement on the importance of contingency funding planning and liquidity 

risk management. Based on this initial review, the FDIC expects to consider in 2024 revisions 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 43 

to existing regulation to address the unique risks and risk management principles that were 

highlighted during the 2023 stress period. The recommendations will also incorporate the 

above-referenced statements from the Federal Housing Finance Agency (FHFA) that the 

Federal Home Loan Banks (FHLBanks) are not well positioned to serve as a lender of last resort 

to depository institutions.

As indicated in the FHFA November 2023 report, FHLBank System at 100 – Focusing on 

the Future, (FHLBanks) may not have the capacity to serve as lenders of last resort, and 

there are limits to the amount of credit that FHLBanks can issue in a single day. Therefore, 

while FHLBanks may provide a suitable longer-term funding solution for well-performing 

institutions, their ability to meet member credit requests on an intraday or shorter-term basis 

may not be practical, especially in times of stress or when an institution’s condition weakens. 

Climate-Related Financial Risks

The role of the FDIC with respect to climate change is focused on the financial risks that 

climate change may pose to the banking system and the extent to which those risks impact 

the FDIC’s core mission and responsibilities.

There is broad consensus among financial regulatory bodies that the effects of climate change 

and the transition to reduced reliance on carbon-emitting sources of energy present unique 

and significant economic and financial risks, and therefore, an emerging risk to the financial 

system and the safety and soundness of financial institutions. Financial institutions are 

likely to be affected by both the physical and transition risks associated with climate change. 

Together, these are generally referred to as climate-related financial risks.

Physical risks generally refer to the harm to people and property arising from acute, climaterelated events, such as hurricanes, wildfires, floods, and heatwaves, as well as chronic shifts 

in the climate, including higher than average temperatures, changes in precipitation patterns, 

rising sea levels, and ocean acidification. Transition risks generally refer to stresses to certain 

financial institutions or sectors arising from the shifts in public investment, consumer and 

business preferences, or technologies associated with a transition toward reduced carbon 

reliance. While physical and transition risks are separate and distinct risks faced by the 

financial system, both may materially increase the risks posed to a financial institution’s 

financial condition.

Changing climate conditions are bringing challenging trends and events, including rising sea 

levels, increases in the frequency and severity of extreme weather events, and other natural 

disasters.9

 These trends may challenge the future resiliency of the financial system and, 

in some circumstances, may pose safety and soundness risks to individual banks. Climate 

change, as well as efforts to mitigate climate change associated with a transition toward 

reduced carbon reliance, present unique, serious, and difficult to quantify risks to all banks 

of all sizes, regardless of their complexity or business model. The characteristics of climate 

change could also potentially impact the effectiveness of past mitigation strategies. The goal 

9 See Intergovernmental Panel on Climate Change (2021; in press), “Summary for Policymakers,” in V. MassonDelmotte, P. Zhai, A. Pirani, S.L. Connors, C. Péan, S. Berger, N. Caud, Y. Chen, L. Goldfarb, M.I. Gomis, M. Huang, 

K. Leitzell, E. Lonnoy, J.B.R. Matthews, T.K. Maycock, T. Waterfield, O. Yelekçi, R. Yu, and B. Zhou, eds., Climate 

Change 2021: The Physical Science Basis. Contribution of Working Group I to the Sixth Assessment Report of the 

Intergovernmental Panel on Climate Change (Cambridge, United Kingdom: Cambridge University Press).
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 44 

of the FDIC’s work on climate-related financial risk is to ensure the financial system continues 

to remain resilient despite these rising risks.

 The FDIC is working to develop a fuller, more formal, and dedicated corporate-wide 

understanding of climate-related financial risks. Initial steps in its efforts to understand and 

address climate-related financial risk include:

 Continuing the work of its internal, cross-disciplinary working group to assess 

the safety and soundness and financial stability considerations associated with 

climate-related financial risks;

 Continuing its existing work with the Basel Committee on Banking Supervision’s 

Task Force on Climate-Related Financial Risks, Network of Central Banks and 

Supervisors for Greening the Financial System (NGFS) and other appropriate 

international organizations, consistent with the mandate of the FDIC;

 Participating on the FSOC’s Climate-Related Financial Risk Committee (CFRC), 

which was created by the FSOC to identify priority areas for assessing and 

mitigating climate-related risks to the financial system and serve as a coordinating 

body, where appropriate, to share information, facilitate the development of 

common approaches and standards, and facilitate communication across FSOC 

members and interested parties;

 Together with the FRB and OCC, jointly issuing principles that provide a high-level 

framework for the safe and sound management of exposures to climate-related 

financial risks for large financial institutions;

10 and

 Building capabilities, through pursuing and developing internal educational 

offerings and training, to foster a corporate-wide understanding of climaterelated financial risks.

The FDIC will continue to expand its efforts to address climate-related financial risks 

through a thoughtful and measured approach that emphasizes risk-based assessments and 

collaboration with other supervisors and the industry.

RULEMAKING AND GUIDANCE

Throughout 2023, the FDIC finalized and initiated a number of key rulemakings governing 

the regulatory framework for insured banks, and issued supervisory guidance to insured 

institutions on a number of current issues.

Community Reinvestment Act Rules

On October 24, 2023, the FDIC, FRB, and OCC issued the final rule to strengthen and modernize 

the Community Reinvestment Act (CRA) regulations, representing the first interagency rewrite 

of the CRA regulations since 1995. The rule will expand access to credit, investment, and basic 

banking services in low- and moderate-income (LMI) communities; adapt to changes in the 

banking industry, including internet and mobile banking; provide greater clarity, consistency, 

10 FDIC, FRB & OCC, Principles for Climate-Related Financial Risk Management for Large Financial Institutions, 88 

Fed. Reg. 74183 (Oct. 30, 2023).
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 45 

and transparency; tailor CRA evaluations and data collection to bank size and type; and 

maintain a unified interagency approach. 

The NPR was issued on May 5, 2022. The agencies reviewed and considered almost 1,000 

unique comments from a variety of stakeholders over the 17 months between the issuance of 

the proposal and the final rule. Based on an analysis of comment letters and further agency 

review, the final rule reduces complexity and data burden and provides increased tailoring 

and flexibility in relation to the NPR. 

FDIC Sign and Advertising Rules and Misrepresentation Rule 

On December 20, 2023, the FDIC Board adopted a final rule to amend part 328 of its 

regulations to modernize the rules governing use of the official FDIC sign and institutions’ 

advertising statements to reflect how depositors do business with IDIs today, including 

through digital and mobile channels. The final rule also clarified the FDIC’s regulations 

regarding misrepresentations of deposit insurance coverage by addressing specific scenarios 

where consumers may be misled as to whether they are doing business with an insured 

institution and whether their funds are protected by deposit insurance. 

Suspicious Activity Reporting Requirements

The FDIC is planning to issue a final rule in 2024 that would amend its Suspicious Activity 

Report (SAR) regulation and permit the FDIC to issue case-by-case exemptions from SAR filing 

requirements to supervised institutions. The existing regulation allows exemptions from 

SAR filing requirements for physical crimes (e.g., robberies and burglaries) and lost, missing, 

counterfeit, or stolen securities, and the proposed rule would allow the FDIC, in conjunction 

with FinCEN, to grant exemptions to supervised institutions that develop innovative solutions 

to otherwise meet AML requirements more efficiently and effectively. The FDIC proposed this 

rule in January 2021 as a proactive measure to address the likelihood that FDIC-supervised 

institutions will leverage existing or future technologies to report, share, or disclose suspicious 

activity in a different manner. 

The FRB, NCUA, and OCC issued similar but independent proposed rulemakings to amend 

their respective SAR regulations. The FDIC is working with these agencies to harmonize the 

language of the final rules for consistency and, if possible, synchronize the rules’ publication 

timing.

Automated Valuation Models

In June 2023, the FDIC, OCC, FRB, NCUA, FHFA, and Consumer Financial Protection Bureau 

(CFPB) published a request for comment on an NPR to implement quality control standards for 

the use of automated valuation models (AVMs) used by mortgage originators and secondary 

market issuers in valuing real estate collateral securing mortgage loans. 

Under the proposal, the agencies would require institutions that engage in certain credit 

decisions or securitization determinations to adopt policies, practices, procedures, and 

control systems to ensure that AVMs used in these transactions to determine the value of 

mortgage collateral adhere to quality control standards designed to ensure a high level of 

confidence in the estimates produced by AVMs; protect against the manipulation of data; seek 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 46 

to avoid conflicts of interest; require random sample testing and reviews; and comply with 

applicable nondiscrimination laws. The comment period closed on August 21, 2023, and the 

FDIC received 13 comments. The agencies are considering comments while working to finalize 

the rule.

Residential Real Estate Valuations

In July 2023, the FDIC, FRB, NCUA, OCC, and CFPB 

issued for comment proposed Interagency Guidance 

on Reconsiderations of Value (ROV) of Residential 

Real Estate Valuations. The proposal highlights the 

risks associated with deficient residential real estate 

valuations, particularly those that can contain errors, 

omissions, or discrimination that affect the value 

conclusion. Additionally, the proposal describes how 

financial institutions may incorporate effective ROV 

processes into established appraisal and evaluation 

programs, consistent with safety and soundness standards and all applicable laws and 

regulations, including those designed to protect consumers.

In addition, the FDIC assumed a one-year term in the role of Vice Chair of the FFIEC Appraisal 

Subcommittee (ASC) on April 1, 2023. The ASC held three public hearings in 2023. The first 

highlighted the issue of appraisal bias with a witness panel representing lenders, appraisers, 

consumers, and academic researchers. The second explored the appraisal regulatory system 

focusing on appraisal standards, appraiser qualification criteria and barriers to enter into 

the profession, appraisal practice, and state regulation. The third hearing focused on the 

development, use, and review of appraisals, including lender and secondary market overlays, 

reconsideration of value, challenges in rural markets and tribal communities, and internal 

review processes for both individual appraisals and appraisals in the aggregate. 

Basel III Capital Standards

On July 27, 2023, the FDIC, FRB, and OCC issued a proposed rulemaking seeking comment on 

a proposal to strengthen capital requirements for large banking organizations. The changes 

would implement the final components of the Basel III standards in the U.S. The proposal 

generally applies to banks with $100 billion or more in total assets. Community banks would 

not be impacted by the proposal.

The implementation of these standards for large banking organizations would strengthen

the resilience of the domestic banking system and is a priority for the banking agencies. 

In particular, the proposal would standardize aspects of the capital framework related to 

credit risk, market risk, operational risk, and credit valuation adjustment risk. The proposal 

would also require banking organizations to include unrealized gains and losses from certain 

securities in their capital ratios. 

Strong capital requirements have proven to be a critical element of the bank regulatory 

framework, allowing the banking industry during times of economic stress to serve as a source 

of strength for the U.S. economy and to lend to creditworthy households and businesses. This 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 47 

change would help ensure that the regulatory capital ratios of large banking organizations 

better reflect their capacity to absorb losses.

The comment period closed on January 16, 2024, and the agencies will work together to 

review comments received.

Standards for Governance and Risk Management for Institutions with Total

Consolidated Assets of $10 Billion or More

In October 2023, the FDIC issued a request for comment on an NPR and issuance of corporate 

governance and risk management guidelines that describe the general obligations of a 

covered institution’s Board of Directors to ensure good corporate governance. Under the 

proposed guidelines the board is expected to, among other things, be active and involved in 

protecting the interests of the covered institution; set goals and approve a strategic plan and 

policies that guide operations of the covered institution in accordance with its risk profile 

and risk appetite and as required by law and regulations; select and supervise executive 

officers; and adopt a code of ethics. The proposed guidelines state that the board should 

create a committee structure that allows the board to oversee the covered institution’s risk 

management framework, including an independent Risk Committee. 

The proposal also sets the FDIC’s expectations for a risk management program that includes 

a three-line-of-defense model for monitoring and reporting risks, including front line units 

(business units that generate revenue or reduce costs), an independent risk management unit, 

and an internal audit unit. The covered institution should effectively communicate its risk 

appetite and policies to employees, and identify and report breaches of risk limits even if the 

covered institution does not realize a loss from the breach. 

The guidelines would apply to all insured state nonmember banks, state-licensed insured 

branches of foreign banks, and insured state savings associations that are subject to section 

39 of the FDI Act, with total consolidated assets of $10 billion or more. The comment period 

closed on February 9, 2024.

Section 19 of the Federal Deposit Insurance Act

In November 2023, the FDIC issued a request for comment 

on an NPR that updates the FDIC’s regulations concerning 

Section 19 of the FDI Act. Section 19 prohibits a person 

from participating in the affairs of an FDIC-insured 

institution if he or she has been convicted of an offense 

involving dishonesty, breach of trust, or money laundering, 

or has entered into a pretrial diversion or similar program in 

connection with a prosecution for such an offense, without 

the prior written consent of the FDIC.

The proposed rule would incorporate changes made by 

the Fair Hiring in Banking Act (FHBA) to Section 19 and 

align the FDIC’s Section 19 regulations with the FHBA’s provisions. These proposed revisions 

address, among other topics, the types of offenses covered by Section 19; the effect upon 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 48 

covered offenses of expungement, sealing, and dismissal of a criminal record; and the FDIC’s 

procedures for reviewing applications filed under Section 19. The comment period closed on 

January 16, 2024. 

Areas Affected by Natural Disasters

During 2023, the FDIC issued 21 advisories through Financial Institution Letters (FILs) to 

provide guidance to financial institutions in areas affected by hurricanes, tornadoes, straightline winds, flooding, wildfires, landslides, and other severe storms to facilitate recovery. 

In these advisories, the FDIC encouraged financial institutions to work constructively with 

borrowers experiencing financial difficulties as a result of natural disasters and clarified that 

prudent extensions or modifications of loan terms in such circumstances can contribute to the 

health of communities and serve the long-term interests of lending institutions. In addition, 

the FDIC joined with the FRB, NCUA, OCC, and state regulatory agencies to issue press releases 

on supervisory practices regarding financial institutions impacted by the Hawaii wildfires and 

Hurricane Idalia. These press releases encouraged financial institutions to work constructively 

with borrowers and offered to expedite requests for temporary facilities to provide more 

convenient availability of services to those affected by these disasters.

Proposed Merger Transactions

One of the FDIC’s key priorities for 2023 was to review the framework for evaluating proposed 

merger transactions. The Bank Merger Act establishes the standards used by the federal 

banking agencies to consider bank merger transactions; however, the process for considering 

bank mergers has not been comprehensively reviewed in 25 years. In light of the significant 

implications of bank mergers for competition, safety and soundness, financial stability, and 

meeting the financial services needs of communities, a careful interagency review of the bank 

merger process was warranted.

In March 2022, the FDIC issued FIL-11-2022, Request for Information on Bank Merger Act, seeking 

information and comments regarding the application of laws, practices, rules, regulations, 

guidance, and statements of policy (collectively, the framework) that apply to merger

transactions involving one or more IDIs, including the merger between an IDI and a noninsured 

institution. Thirty-three comments were received. The themes and issues raised continue 

to guide revisions to the framework, including the FDIC Statement of Policy on Bank Merger 

Transactions.

To realize the FDIC’s bank merger-related priorities, one of the agency’s performance goals 

for 2022 was to initiate an interagency review of the processes used by the federal banking 

agencies under the Bank Merger Act. Accordingly, the FDIC in 2023 continued to participate 

in discussions with other federal banking agencies, namely the FRB and OCC, as well as with 

the Department of Justice, as appropriate. 

Climate-Related Financial Risk

In October 2023, the FDIC, FRB, and OCC jointly issued principles that provide a high-level 

framework for the safe and sound management of exposures to climate-related financial risks, 

consistent with the risk management frameworks described in the agencies’ existing rules 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 49 

and guidance.11 The principles are intended to support efforts by large financial institutions to 

focus on key aspects of climate-related financial risk management in a manner consistent with 

safe and sound practices.

Although all financial institutions, regardless of size, may have material exposures to climaterelated financial risks, the principles are intended for the largest financial institutions, those 

with over $100 billion in total consolidated assets. The agencies expect financial institutions 

to take a risk-based approach in assessing the climate-related financial risks associated 

with their customer relationships and to take into account the financial institution’s ability 

to manage those risks. The principles are intended to promote a consistent understanding 

of the effective management of climate-related financial risks. The agencies may consider 

providing additional resources or guidance, as appropriate, to support financial institutions 

in prudently managing these risks while continuing to meet the financial services needs of 

their communities.

Contingency Funding Plans 

In July 2023, the FDIC, FRB, and OCC jointly issued updated guidance to remind depository 

institutions to maintain actionable contingency funding plans that take into account a range 

of possible stress scenarios. The statement reminds depository institutions to proactively 

assess the stability of their funding and maintain a broad range of funding sources that can 

be accessed in adverse circumstances and encourages them to incorporate the Federal 

Reserve Banks’ discount window as part of their contingency funding arrangements. The 

statement also reminds institutions to ensure collateral is available for borrowing in an 

amount appropriate for potential contingency funding needs and to be aware of operational 

requirements to obtain funding from contingent sources.

Commercial Real Estate Accommodations and Workouts

In June 2023, the FDIC, OCC, FRB, and NCUA, in consultation with state bank and credit union 

regulators, issued the final Interagency Policy Statement on Prudent Commercial Real Estate 

Loan Accommodations and Workouts (FIL-34-2023). The statement is a principles-based 

resource for financial institutions to consider when engaging 

with borrowers experiencing financial difficulties. The 

updated statement finalized a proposed statement issued 

in the third quarter of 2022, updates the October 2009 

Policy Statement on Prudent Commercial Real Estate Loan 

Workouts12 adopted by FFIEC agencies, builds on existing 

supervisory guidance calling for financial institutions to 

work prudently and constructively with creditworthy borrowers during times of financial 

stress, updates existing interagency supervisory guidance on commercial real estate loan 

workouts, and adds a section on short-term loan accommodations. The updated statement 

also addresses relevant accounting standard changes on estimating loan losses and provides 

updated examples of classifying and accounting for loans modified or affected by loan 

accommodations or loan workout activity.

11 See FIL-56-2023. On March 30, 2022, the FDIC issued FIL-13-2022, Request for Comment on Statement of Principles 

for Climate-Related Financial Risk Management for Large Financial Institutions.

12 See FFIEC Press Release, October 30, 2009, available at: https://www.ffiec.gov/press/pr103009.htm
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 50 

Third-Party Relationships

In June 2023, the FDIC, OCC, and FRB issued the final Interagency Guidance on Third-Party

Relationships: Risk Management designed to help banking organizations manage risks 

associated with third-party relationships, including relationships with financial technology 

(fintech) companies, consistent with existing safety and soundness requirements in law and 

regulation. The guidance describes principles and examples of considerations for banking 

organizations’ risk management of third-party relationships and covers risk management 

practices for the stages in the life cycle of third-party relationships: planning, due diligence 

and third-party selection, contract negotiation, ongoing monitoring, and termination. The 

guidance also includes how supervisors will evaluate banking organization’s third-party risk 

management practices. The guidance replaces each agency’s existing general third-party 

guidance13 and promotes consistency in the agencies’ supervisory approaches toward thirdparty risk management. The final guidance reflects the streamlined language and improved 

clarity based on the agencies’ consideration of public comments on the proposed guidance 

released in July 2021.

London Inter-Bank Offered Rate (LIBOR) Transition

In April 2023, the FDIC, FRB, OCC, NCUA, and CFPB, in 

conjunction with the state bank and state credit union 

regulators, jointly issued a statement to remind supervised 

institutions that U.S. dollar LIBOR panels would end on June 

30, 2023. The agencies also reiterated their expectations 

that institutions with USD LIBOR exposures should complete 

their transition of remaining LIBOR contracts as soon as 

practicable.

Crypto-Asset Risks

In January 2023, the FDIC, FRB, and OCC released a Joint Statement on Crypto-Asset Risks to 

Banking Organizations. The statement reminds banking organizations that they should ensure

that crypto-asset-related activities can be performed in a safe and sound manner, are legally 

permissible, and comply with applicable laws and regulations, including those designed to 

protect consumers (such as fair lending laws and prohibitions against unfair, deceptive, or 

abusive acts or practices). 

Also, in February 2023, the FDIC, FRB, and OCC issued a Joint Statement on Liquidity Risks 

to Banking Organizations Resulting from Crypto-Asset Market Vulnerabilities on the liquidity 

risks to banking organizations presented by certain sources of funding from crypto-assetrelated entities. This statement highlights key liquidity risks associated with crypto-assets 

and crypto-asset sector participants of which banking organizations should be aware. In 

particular, certain sources of funding from crypto-asset-related entities may pose heightened 

liquidity risks to banking organizations due to the unpredictability of the scale and timing of 

deposit inflows and outflows. The statement reminds banking organizations to apply existing 

risk management principles and provides examples of practices that could be effective. 

13 The guidance rescinds and replaces the FDIC’s Guidance for Managing Third-Party Risk issued in FIL-44-2008.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 51 

The agencies also continue to emphasize that banking organizations are neither prohibited 

nor discouraged from providing banking services to customers of any specific class or type, as 

permitted by law or regulation. 

Research

CENTER FOR FINANCIAL RESEARCH

The FDIC’s Center for Financial Research (CFR) encourages, 

supports, and conducts innovative research on topics 

that inform the FDIC’s key functions of deposit insurance, 

supervision, and the resolution of failed banks. CFR 

researchers have published papers in leading banking, 

finance, and economics journals, including the American 

Economic Review; Journal of Money, Credit, and Banking;

The Review of Financial Studies; and Journal of Financial Services Research. In addition, 

CFR researchers present their research at major conferences, regulatory institutions, and 

universities.

The CFR also develops and maintains many financial models used throughout the FDIC, 

including off-site models that inform the examination process. CFR economists also provide 

ongoing support to RMS during on-site examinations.

In April 2023, the CFR hosted the FDIC Academic Challenge. The FDIC Academic Challenge is a 

team competition for undergraduate students, designed to bring real-world policy questions 

into the classroom and address questions concerning the banking industry. The topic for the 

FDIC’s CFO Bret D. Edwards (third from left) with the winners of the 2022-2023 

FDIC Academic Challenge, from the State University of New York College at Geneseo.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 52 

2022-2023 FDIC Academic Challenge was “The Impact of Higher Interest Rates on the Banking 

Sector.” Five finalist teams participated in an all-day event during which they presented their 

projects to a panel of five judges that included community bank CEOs, a university professor, 

and FDIC representatives. Throughout the day, the teams learned about careers at the FDIC, 

market conditions, and bank regulation. The State University of New York College at Geneseo 

was announced as the winner of the challenge. 

In September, the CFR hosted the 22nd Annual Bank Research Conference, which focused on 

bank deposit funding and capital; characteristics of banking crises; nonbanks; bank lending; 

the effects of banking on the real economy; fintech; and borrower characteristics, soft 

information, and credit allocation. The conference also included a poster session during which 

student authors presented their research on poster boards for discussions with attendees 

and recorded short presentations of their papers for the conference website. The conference 

also featured a fast-track session during which authors presented five papers in a condensed 

timeframe.

In 2023, the CFR hosted two PhD students as part of the Summer Research Fellows Program. 

The program targets PhD students who have completed their qualifying examinations and 

have well-developed research towards finishing their PhDs. Summer Research Fellows are 

encouraged to continue their dissertation work and build research relationships with FDIC 

colleagues. They participate in seminars and informal lunchtime presentations of research, 

engage with FDIC staff, and present their own research at the end of the summer.

The Summer Research Fellows benefit from institutional knowledge of FDIC staff, CFR 

expertise on modeling, and presentation opportunities. The FDIC benefits from developing 

relationships with emerging scholars, expanding the reach of the CFR research network, and 

promoting career opportunities at the FDIC.

In partnership with the American Economic Association Summer Program and Howard 

University, CFR hosted two undergraduate students in the summer of 2023. The summer 

experiential learning program offered the students an opportunity to apply their research 

skills to FDIC-relevant questions under the guidance of CFR economists, and to develop 

career-long mentoring relationships. The program aims to increase diversity in the field of 

economics and to attract a diverse workforce to related positions. The FDIC also hosted the 

entire American Economic Association Summer Program for an informational lunch, featuring 

a panel of FDIC managers who discussed their divisions’ missions and a networking lunch for 

students and junior FDIC staff.

The CFR sponsors the Small Business Lending Survey, a nationally representative survey of 

banks that provides a current view of their small business lending practices. Topics covered in 

the 2022 collection include customer interaction, loan underwriting and approvals, markets 

and competition, and the use of financial technology. In 2023, CFR economists analyzed the 

survey responses and began drafting a report of the main findings, which is expected to be 

published in 2024.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 53 

Speakers at the AEA Summer Program Luncheon.

National and Regional Risk Analysis

The FDIC’s National and Regional Risk Analysis (NRRA) Branch identifies, analyzes, monitors, 

and communicates developments and key risks in the economy, financial markets, and 

banking industry that may impact FDIC-insured institutions and the DIF. As part of this work, 

NRRA publishes the Quarterly Banking Profile—a comprehensive summary of financial results 

for all FDIC-insured institutions. This report card on industry status and performance includes 

written analyses, graphs, and statistical tables. NRRA also published the 2023 Risk Review, 

summarizing key credit, market, operational, crypto-asset, and climate-related financial risks 

facing banks.

In addition, NRRA publishes topical articles in the FDIC Quarterly. In 2023, the FDIC Quarterly 

included two articles:

 “2022 Summary of Deposits Highlights,” which explains trends in bank deposit 

and branch growth; and

 “Banking Sector Performance during Two Periods of Sharply Higher Interest Rates: 

2022 and 2004 to 2006”.

CONSUMER RESEARCH

2023 FDIC National Survey of Unbanked and Underbanked Households

Working with the United States Census Bureau, the FDIC administered its eighth national 

survey of U.S. households, measuring participation in the banking system and collecting 

information on the reasons why some households remain unbanked. A full report of results 

will be released in 2024.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 54 

FDIC Survey of Volunteer Income Tax Assistance Providers

Volunteer Income Tax Assistance (VITA) providers are nonprofit organizations located 

throughout the country that help lower-income individuals and families file tax returns. In 

many cases, these returns result in significant refunds. 

The receipt of these refunds has the potential to present 

a “bankable moment” in which filers may choose to open 

an account to quickly and securely receive their payment. 

Some, but not all, VITA providers offer clients the 

opportunity to open bank accounts and access to 

additional services designed to enhance financial well-being. To better understand providers’ 

partnerships with banks and obstacles to some providers initiating partnerships, the FDIC 

conducted a survey of providers to explore their interest in doing more to support the 

economic inclusion of households in the banking system. A full report of results will be 

released in 2024.

Community Banking

Community banks provide traditional, relationship-based banking services in their local 

communities. The FDIC is the primary federal supervisor for the majority of community banks.

Community banks (as defined for FDIC research purposes) made up 90 percent of all FDICinsured institutions on September 30, 2023. While these banks hold just 11.5 percent of 

banking industry assets, community banks are of critical importance to the U.S. economy and 

local communities across the nation. 

As of June 2023, community banks held 38.3 percent of the industry’s small loans to farmers 

and businesses, making them the lifeline to entrepreneurs and small enterprises of all types. 

They hold the majority of bank deposits in U.S. rural counties and micropolitan counties 

with populations up to 50,000. In fact, as of June 2023, community banks held more than 57 

percent of total deposits in 1,956 U.S. rural and micropolitan counties. In more than half of 

these counties (58.5 percent), the only banking offices available to consumers were those 

operated by community banks.

COMMUNITY BANKING RESEARCH

The FDIC pursues an ambitious, ongoing agenda of research and outreach focused on 

community banking issues. In conjunction with the 2012 and 2020 community banking 

studies, FDIC researchers have published more than a dozen additional analyses on various 

banking topics. 

The FDIC Quarterly Banking Profile includes a section explicitly focused on community bank 

performance, providing a detailed statistical picture of the community banking sector that can 

be accessed by analysts, other regulators, and bankers themselves. The most recent report 

shows that quarterly net income at community banks decreased 15 percent on a merger-
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 55 

adjusted basis in the third quarter of 2023 compared with the third quarter of 2022, reflecting 

lower net interest income, higher noninterest expense, and greater realized losses on the sale 

of securities.

The long-term trend of consolidation in the banking industry has done little to diminish the 

role of community banks. For example, despite the number of community banks declining by 

137 since September 2022, loans at community banks grew 9.8 percent between September 

2022 and September 2023, on a merger-adjusted basis. The increase in loans reflects growth 

in 1-4 family residential loans and nonfarm, nonresidential commercial real estate loans. The 

majority of community banks (88.5 percent) reported annual loan growth.

Advisory Committee on Community Banking

The FDIC’s Advisory Committee on Community Banking (CBAC) is an ongoing forum for 

discussing issues faced by community banks and receiving valuable feedback from the 

industry. It is a valuable resource for information on a wide range of topics, including 

examination policies and procedures, capital and other supervisory issues, credit and 

lending practices, deposit insurance assessments and coverage, and regulatory compliance 

issues. The Committee is composed of community bank executives from around the country. 

Members of the CBAC represent community banks of various sizes from different areas of 

the country, both rural and urban, that are engaged in a variety of business lines. Members 

serve for two-year terms, which may be extended or renewed. Eight new members joined the 

Committee in 2023.

The Committee met twice in 2023. The June 2023 CBAC meeting included a discussion of 

banking conditions and supervisory issues, including asset-liability management, commercial 

real estate lending, and cybersecurity. The meeting also included an update on the Deposit 

Insurance Fund. Additionally, Supervisory Guidance on Charging Overdraft Fees for Authorize 

Positive, Settle Negative Transactions was discussed. The Minority Depository Institutions 

Subcommittee of the CBAC provided an update on its meeting that was held the day prior. 

The October 2023 meeting included a discussion of banking conditions, liquidity risk 

management, third-party risk management guidance, commercial real estate workouts, and 

anti-money laundering issues. In addition, financial institution diversity self-assessments were 

discussed, and the Minority Depository Institutions Subcommittee provided an update on its 

meeting that was held the day prior. 

Advisory Committee of State Regulators

The FDIC’s Advisory Committee of State Regulators is another mechanism for state regulators 

and the FDIC to discuss current and emerging issues that have potential implications for the 

regulation and supervision of state-chartered financial institutions. The Advisory Committee 

members include regulators of state-chartered financial institutions from across the United 

States as well as other individuals with expertise in the regulation of state-chartered financial 

institutions. The Advisory Committee met once in October 2023. During the meeting, the 

Committee discussed the impact of economic conditions on financial institutions they 

supervised, financial institution diversity self-assessments, newly issued guidance, and 

examination practices. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 56 

De Novo Banks

In 2023, the FDIC continued processing deposit insurance applications, meeting with 

applicants to discuss the application process and specific proposals, and making application 

data available on the FDIC’s website. The FDIC has provided several resources to aid organizers 

in developing deposit insurance application proposals, including conducting reviews of 

draft proposals. Interested parties may access application-related information and data on 

applications at www.fdic.gov.

During 2023, the FDIC received two draft application proposals from community banks. The 

FDIC maintains an internal goal of providing final feedback on 75 percent of draft community 

bank proposals within 60 days of receipt. Final feedback for both draft proposals for 

community banks received in 2023 was provided within 60 days of receipt.

Technical Assistance Program

The FDIC continued to provide a robust technical assistance program for bank directors, 

officers, and employees. The technical assistance program includes an online Banker 

Resource Center, Directors’ College events held across the country, industry teleconferences 

and webinars, and a video program. 

The FDIC regularly updates the Banker Resource Center on its website. This one-stop resource 

for bankers contains detailed information on supervisory topics and general information in a 

number of other areas for bankers and is located at https://www.fdic.gov/resources/bankers. 

In 2023, the FDIC hosted a variety of outreach sessions in all six FDIC regions. These sessions 

were conducted both independently and jointly with state trade associations or other

financial regulators. Three regions hosted Directors’ Colleges. During these sessions, FDIC 

employees engaged with bank directors and officers on various topics, including thirdparty relationships, information technology and cybersecurity, emerging risks, the Current 

Expected Credit Losses methodology for estimating allowances for credit losses, interest rate 

risk, liquidity risk management, and consumer protection, among other topics. Five regions 

conducted banker roundtable events that provided a forum for bankers to receive information 

and raise questions about laws, regulations, or emerging risks. 

In addition, on behalf of the FFIEC, the FDIC hosted a national banker webinar this year 

covering cybersecurity awareness with guest speakers from the FBI. Additionally, the FDIC 

participated in two interagency webinars, relating to the Supervisory Update on Funding and 

Liquidity Risk Management and the Interagency Policy Statement on Prudent Commercial Real 

Estate Loan Accommodations and Workouts.

Deposit Insurance Coverage Webinars

The FDIC held five live seminars on FDIC deposit insurance coverage for bank staff and bank 

officers between May 2023 and October 2023, via Microsoft (MS) Teams. Each seminar lasted 

approximately 90 minutes and included a Question and Answer session. Three sessions titled 

Comprehensive Deposit Insurance Seminar for Bankers offered a broad overview of FDIC deposit 

insurance rules. Two sessions titled New Rules for Revocable and Irrevocable Trust Accounts 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 57 

provided an in-depth discussion of the newly issued rules for trust accounts, effective April 

1, 2024. The sessions provided bank employees with a broad understanding of FDIC deposit 

insurance coverage rules.

Through the Technical Assistance Video Program, the FDIC provides a series of educational 

videos designed to provide useful information to bank directors, officers, and employees on 

various risk management and consumer protection-related matters. The videos help FDICsupervised institutions understand various risk management and consumer protectionrelated matters. In 2023, the FDIC released one video for bank directors and one video for bank 

officers and staff, each covering cybersecurity. 

Activities Related to Large and Complex 

Financial Institutions, Including Systemically

Important Financial Institutions

The FDIC is committed to addressing the unique challenges associated with supervising, 

insuring the deposits of, and resolving large and complex financial institutions (LCFIs). The 

agency’s ability to analyze and respond to risks posed by these institutions is critical, as they 

comprise a significant share of banking industry assets and deposits.

The FDIC’s Division of Complex Institution Supervision and Resolution (CISR) was established 

in 2019 to centralize and integrate the FDIC’s operations to leverage both supervisory and 

resolution expertise related to LCFIs, including systemically important financial institutions 

(SIFIs).

The mission of CISR is to protect and maintain stability in the U.S. financial system by avoiding 

and, if necessary, managing the failure of LCFIs. CISR 

performs ongoing risk monitoring of LCFIs in its portfolio 

that are domestic global systemically important banks 

(G-SIBs), large foreign banking organizations (FBOs), and 

large domestic banking groups, and provides backup 

supervision of the firms’ related IDIs, in addition to 

monitoring and assessing systemic and emerging risks 

across the CISR portfolio. CISR evaluates firms’ required 

resolution plans and assesses the resolvability of 

individual LCFIs. The division formulates and, in the event 

of failure, leads the execution of strategies and plans for resolving LCFIs under either the FDI 

Act or the Dodd-Frank Act (Title II). CISR also develops and monitors policy relevant to CISR’s 

mission and supports engagement in various external forums such as FSOC and the Financial 

Stability Board. 

CISR leads and conducts its responsibilities for the FDIC in close collaboration with RMS, DRR, 

Legal, and other FDIC Offices and Divisions, so as to maintain and enhance integration of the 

agency’s LCFI crisis management planning, preparedness, and response activities.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 58 

SUPERVISION AND RISK ASSESSMENT

Monitoring and Measuring Systemic Risks

The FDIC monitors risks related to G-SIBs as well as other large domestic banks and FBOs at 

both the firm-level and industry-wide to inform supervisory planning and response, policy 

and guidance considerations, and resolution planning 

efforts. As part of this monitoring, the FDIC analyzes each 

company’s risk profile, governance and risk management 

strategies, structure and interdependencies, business

operations and activities, management information

system capabilities, and recovery and resolution 

capabilities. Evaluating capital and liquidity adequacy 

and resiliency under stressed conditions is also a key part 

of monitoring. Further, in response to market and deposit volatility experienced during the 

banking industry stress in March 2023, the FDIC performed heightened risk monitoring. 

The FDIC works closely with the other federal regulatory agencies as well as foreign regulators 

to analyze institution-specific and industry-wide conditions and trends, emerging risks 

and outliers, risk management, and the potential financial stability risk posed by G-SIBs, 

other large domestic banks and FBOs, and nonbank financial companies. To support 

risk monitoring, the FDIC has developed systems and reports that make extensive use of 

structured and unstructured data. Monitoring reports cover a variety of aspects that include 

risk components, business lines and activity, market trends, and product analysis. 

In addition, the FDIC continues to expand its monitoring systems, including the CISR Risk 

Monitor (CRM), the SIFI Risk Report (SRR), and the CAMELS Verification document. The CRM 

is an off-site monitoring system that combines bank holding company quantitative financial 

information with qualitative information to support CISR’s identification and assessment 

of firm and broader market stress. The SRR identifies key vulnerabilities of systemically 

important firms, and the CAMELS Verification document includes an independent assessment 

of the appropriateness of supervisory CAMELS ratings for the IDIs held by these firms. 

Information from these and other FDIC-prepared reports is used to prioritize activities relating 

to oversight of LCFIs and to coordinate supervisory and resolution-related activities with the 

other banking agencies.

Back-Up Supervision Activities for IDIs of SIFIs

Risk monitoring is enhanced by the FDIC’s backup supervision activities. In this role, as 

outlined in Sections 8 and 10 of the FDI Act, the FDIC has expanded resources and has 

developed and implemented policies and procedures to guide backup supervisory activities. 

These activities include performing analyses of industry conditions and trends, supporting 

insurance pricing, participating in supervisory activities with other regulatory agencies, and 

exercising independent examination and enforcement authorities when necessary.

At institutions where the FDIC is not the primary federal regulator, FDIC staff work closely 

with other regulatory authorities to identify emerging risks and assess the overall risk profile 

of large and complex institutions. The FDIC has assigned dedicated staff to IDIs that are LCFIs 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 59 

to enhance risk-identification capabilities and facilitate the communication of supervisory 

information.

FDIC’s Backup Supervision Activities

During 2023, FDIC staff completed 40 targeted examinations and 54 reviews as part of 12 

horizontal examination programs with the FRB or OCC involving G-SIBs, FBOs, and large 

regional banks.

Targeted Examinations Horizontal Examinations

The targeted examination activities included,

but were not limited to, the evaluation of 

interest rate risk, commercial real estate, climate 

risk, enterprise risk governance, model risk 

management, non-bank financial institutions

(NBFI), third-party risk management, market risk 

and trading activities.

The horizontal examinations included the 

Comprehensive Capital Analysis and Review

(CCAR), Horizontal Capital Review (HCR), 

Shared National Credits (SNC), CRE Downturn 

Preparedness, Intraday Liquidity Risk 

Management, FRB’s Recovery Planning 

(Phase I), OCC’s Recovery Planning, Fundamental 

Review of the Trading Book (FRTB), Interagency 

Coordinated Cybersecurity Review (iCCR), 

Interest Rate Risk Management, LFBO Liquidity 

Risk Management, and FRB’s Climate

Scenario Exercise.

RESOLUTION PLANNING

Title I Resolution Plans

Certain large banking organizations, as well as any nonbank financial companies designated 

by FSOC for supervision by the FRB, are periodically required to submit resolution plans to 

the FDIC and FRB. Each resolution plan, commonly known as a “living will,” must describe the 

company’s strategy for a rapid and orderly resolution under the U.S. Bankruptcy Code in the 

event of material financial distress or failure of the company. 

The eight most systemically important domestic banking organizations submitted full 

resolution plans on or before July 1, 2023, and these plan submissions are being evaluated 

jointly with the FRB. In August 2023, the FDIC issued jointly with the FRB proposed guidance 

to enhance the Title I resolution plans prepared by the Category II and Category III Triennial 

Full Filers, which includes the largest regional banks with assets between $250 and $700 

billion, as well as several foreign-based institutions. This proposed guidance draws upon 

guidance previously issued to the global systemically important banking organizations, 

reflects observations drawn from the most recent resolution plan submissions, and addresses 

certain capabilities that are essential for firms to have to effect an orderly resolution under the 

Bankruptcy Code, such as those necessary to project the capital and liquidity needed to carry 

out their plan; operational capabilities related to payment, clearing, and settlement activities; 

collateral; management information systems; and shared and outsourced services.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 60 

IDI Resolution Planning

Section 360.10 of the FDIC’s resolution and receivership rules requires an IDI with total assets 

of $50 billion or more to periodically submit to the FDIC a plan for its resolution in the event 

of its failure (the “IDI rule”). The IDI rule requires covered IDIs to submit a resolution plan that 

would allow the FDIC, as receiver, to resolve the institution under Sections 11 and 13 of the 

FDI Act in an orderly manner that enables prompt access to insured deposits, maximizes 

the return from the sale or disposition of the failed IDI’s assets, and minimizes losses realized 

by creditors.

In June 2021, the FDIC outlined a modified approach to implementing the IDI rule in a manner 

which focused on certain requirements for IDIs with $100 billion or more in total assets. 

Resolution plans for 21 IDIs were submitted on or before December 1, 2022. Two of these 

IDIs failed and were resolved by the FDIC during the course of the plan review. A third IDI was 

acquired by another filer. The remaining plans have been reviewed and feedback has been 

provided to the institutions. New resolution plans for an additional 12 IDIs were submitted 

in 2023 and are under review. For IDIs with less than $100 billion in total assets, the April 2019 

moratorium on submission of IDI resolution plans remains in effect. However, on August 29, 

2023, the FDIC proposed amending the section 360.10 resolution planning rule which would 

modify the scope and requirements for these submissions as described further below under 

“Resolution Policy”.

The FDIC also undertakes institution-specific resolution planning under the FDI Act for IDIs 

that are LCFIs, drawing on both IDI plans submitted by the firms and follow-on engagement 

with the firms. The development of a large regional bank resolution framework and process 

builds on lessons learned from historical bank resolutions and practices developed in 

connection with Title II resolution readiness planning for LCFIs. The FDIC is incorporating 

lessons learned from the three large bank failures that occurred in the spring of 2023 into its 

development of these plans.

Title II Orderly Liquidation Authority 

Under the Dodd-Frank Act, failed or failing financial companies are expected to file for 

reorganization or liquidation under the U.S. Bankruptcy Code, similar to any failed or failing 

nonfinancial company. If resolution under the Bankruptcy Code would result in serious 

adverse effects to U.S. financial stability, Title II of the Dodd-Frank Act provides a backup 

authority for resolving a company for which the bankruptcy process is not viable. There are 

strict parameters on the use of the Title II Orderly Liquidation Authority, however, and it can 

only be invoked under a statutorily prescribed recommendation and determination process, 

coupled with an expedited judicial review process.

The FDIC has undertaken institution-specific strategic planning to carry out its orderly 

liquidation authorities with respect to the largest G-SIBs operating in the United States. The 

strategic plans and resolution optionality being developed for these firms are informed by 

the Title I plan submissions. Further, the FDIC updates its systemic resolution framework to 

incorporate enhanced firm capabilities established through the Title I planning process and 

other domestic and foreign resolution planning and policy developments. The FDIC continues 

to build out process documents to facilitate the implementation of the framework in a Title 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 61 

II resolution. In addition, work continues in the development of resolution strategies for 

financial market utilities that have been designated as systemically important by the FSOC, 

particularly the five that are central counterparties (CCPs).

As noted in response to the Office of Inspector General’s Orderly Liquidation Authority 

Evaluation Report (No. EVAL-23-004), the FDIC is committed to continuing to improve 

and mature its framework for the orderly resolution of a SIFI, including strengthening 

governance practices, improving internal process documentation, further specifying roles 

and responsibilities, enhancing training, and allocating additional resources. This work will 

continue to be part of the FDIC’s ongoing strategic initiatives over the next several years.

Resolution Policy

The failures of Silicon Valley Bank, Signature Bank, and First Republic Bank in the first half 

of 2023 demonstrated the risks that banks – even those that are not G-SIBs – can pose to 

financial stability. These regional banking failures informed the development of several 

resolution policy initiatives already underway at the time of their demise. 

In August 2023, the federal banking agencies proposed a set of rulemakings and guidance to 

enhance resolution planning and preparedness, particularly for large IDIs. This included three 

complementary proposals.

Long-Term Debt Requirements

The FDIC, FRB, and OCC jointly issued an NPR to require IDIs that are not consolidated 

subsidiaries of U.S. G-SIBs and that (i) have total consolidated assets of $100 billion or 

more or (ii) are affiliated with IDIs that have at least $100 billion in consolidated assets to 

maintain outstanding a minimum amount of eligible long-term debt (LTD) that can be used 

to absorb losses in the event of their failure. In addition to the IDI-level requirement, the 

FRB is proposing to require the covered entities of such IDIs to also maintain outstanding a 

prescribed amount of LTD and to comply with specified clean holding company requirements 

akin to those required of G-SIBs.

In addition to increasing the options for the resolution of large banks, the proposed rule, if 

enacted, would reduce the risk of loss to depositors and the Deposit Insurance Fund in the 

event of a large regional bank failure. Many large banks already maintain significant amounts 

of long-term debt, though most banks would need to issue additional new long-term debt to 

meet the proposed requirement.

The proposed LTD requirement would take full effect three years after the date on which 

a covered IDI first becomes subject to the proposed rule. The full amount of LTD that 

covered IDIs would be required to hold, however, would be phased in over the three-year 

implementation period to reduce the potential for market disruption.

Resolution Plans and Informational Filings

The FDIC’s proposed IDI Planning Rule would strengthen the existing IDI resolution planning 

requirements under 12 CFR § 360.10. The proposal would require a resolution submission from 

covered IDIs every two years with more limited supplements filed in the other years.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 62 

IDIs with total assets of at least $100 billion would be required to submit comprehensive 

resolution plans to support the FDIC’s efficient and effective resolution of a large IDI under the 

FDI Act. These resolution plans would enhance current IDI resolution planning requirements 

by incorporating useful elements of existing guidance and important lessons learned from 

past plan reviews and from past large IDI resolutions, including those that occurred in the 

spring of 2023. 

Under this proposal, IDIs with total assets of at least $50 billion but less than $100 billion 

would submit limited informational filings to provide the FDIC with critical information to 

assist in their potential resolution. These IDIs would not be required to develop a resolution 

strategy as part of their submissions.

Under the proposed submission schedule, IDIs would file a complete resolution plan on a 

date that will be specified by the FDIC every other year, beginning at least 270 days from the 

effective date of the final rule. 

Guidance for Title I Resolution Plan Submissions

The FDIC and FRB have proposed new guidance to help certain large banks to further develop 

and enhance their resolution plans required under Title I of the Dodd-Frank Act.

The guidance is organized around key areas of potential vulnerability, such as capital, liquidity, 

and operational capabilities that could be needed in resolution. Distinct from the guidance to 

the largest and most complex companies, the proposal would provide agency expectations 

for both single point of entry and multiple point of entry strategy needs, which are different 

strategies companies may adopt for their rapid and orderly resolution. It also would propose 

that FBOs develop their U.S. resolution strategies to be complementary to their global 

resolution plans.

The comment period for these resolution policy proposals closed on November 30, 2023. The 

FDIC, along with the other federal regulatory agencies are reviewing the comments submitted 

and would aim to finalize the rules and guidance in 2024.

Recordkeeping Requirements

The FDIC has implemented several recordkeeping regulations to support the resolvability 

of certain large IDIs and nonbank financial companies by requiring institutions subject to 

those regulations to maintain recordkeeping and reporting capabilities to enable the timely 

determination of deposit insurance coverage and the evaluation of Qualified Financial 

Contracts (QFCs). The FDIC maintains programs to test such institutions’ compliance with 

those regulations.

Timely Deposit Insurance Determination

The FDIC’s Recordkeeping for Timely Deposit Insurance Determination regulation (12 CFR 

Part 370) became effective on October 1, 2019. Under this rule, an IDI that has two million 

or more deposit accounts for two consecutive quarters must implement the IT system and 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 63 

recordkeeping capabilities needed to calculate the amount of deposit insurance coverage 

available for each deposit account in the event of its failure. Doing so will improve the FDIC’s 

ability to fulfill its statutory mandates to pay deposit insurance as soon as possible after an 

institution’s failure and to resolve an institution at the least cost to the DIF. The FDIC conducts 

periodic compliance tests to assess the adherence of covered institutions to the rule.

The FDIC’s Large-Bank Deposit Insurance Determination Modernization regulation (12 CFR 

360.9) became effective on August 18, 2008. Under this rule, an IDI that has at least $2 billion 

in deposits and at least either (i) 250,000 deposit accounts or (ii) $20 billion in total assets, 

regardless of the number of deposit accounts, for two consecutive quarters, must have an 

automated process for implementing a provisional hold on all deposit accounts, foreign 

deposit accounts, and sweep investment accounts in the event of its failure. The rule permits 

the FDIC to fulfill its legal mandates regarding the resolution of failed IDIs to provide liquidity 

to depositors promptly, enhance market discipline, and reduce the FDIC’s costs by preserving 

the franchise value of a failed institution. The FDIC conducts periodic compliance tests to 

assess the adherence of covered institutions to the rule.

Qualified Financial Contracts

There are two regulations that require QFC recordkeeping. The first is the regulation 

promulgated by the Secretary of the Treasury for Qualified Financial Contracts Recordkeeping 

related to the FDIC Orderly Liquidation Authority (31 CFR Part 148), which requires certain 

nonbank financial companies to provide detailed QFC reporting to the FDIC on an ongoing 

basis. The second is the FDIC’s Recordkeeping Requirements for Qualified Financial Contracts 

regulation (12 CFR Part 371), which requires IDIs meeting the definition of “troubled condition” 

to provide detailed QFC reporting to the FDIC.

Both rules require institutions within their scope to prepare in advance and provide the 

information about their QFC portfolios, which may be of a significant size and complexity, in 

order to facilitate well-informed decisions about how to manage the QFCs if the FDIC were 

ever appointed receiver for any of those institutions, whether under the FDI Act or under the 

Orderly Liquidation Authority of the Dodd-Frank Act, as applicable. The FDIC requires periodic 

submissions from such institutions to assess their adherence to these rules.

Cross-Border Cooperation

Cross-border cooperation and advance planning are critical components of resolution 

and crisis management planning due to the international nature of services and overseas 

operations of many LCFIs. In 2023, the FDIC continued its robust bilateral and multilateral 

engagement with foreign authorities to deepen mutual understanding of the complex legal 

and operational issues related to cross-border resolution and preparedness. This work is 

underpinned by an understanding that transparency and confidence in resolution planning 

will serve as a stabilizing force during times of stress.

In 2023, the FDIC led significant principal- and staff-level engagements with foreign 

jurisdictions to discuss cross-border issues and potential impediments that could affect 

resolvability as part of ongoing efforts to continue to deepen coordination on cross-border 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 64 

resolution. For example, the FDIC engaged in ongoing trilateral work on cooperation in the 

cross-border resolution of G-SIBs with U.S., UK, and European Union (EU) financial regulatory 

authorities. Contributors to this work include senior staff and senior officials of participating 

financial regulatory agencies from these jurisdictions. The FDIC maintains a close working 

relationship on cross-border resolution planning topics with EU and UK authorities, among 

other jurisdictions, including through joint meetings and technical experts calls.

Financial Stability Board Resolution Steering Group

The FDIC continued to enhance cooperation on cross-border resolution through its 

participation in the Financial Stability Board (FSB) Resolution Steering Group (ReSG) and 

its subgroups on banks, insurance, and financial market infrastructures. This year, the FDIC 

continued its active engagement in FSB work, in particular through the FDIC’s leadership as 

ReSG Chair, as co-chair of its Cross-Border Crisis Management Committee for Financial Market 

Infrastructures, and as a member of ReSG and each of its subgroups, thereby contributing to 

work on standards and implementation.

Cross-Border Crisis Management Groups

With regard to the FDIC’s institution-specific engagement, the FDIC co-chairs cross-border 

Crisis Management Groups (CMGs) of supervisors and resolution authorities for U.S. G-SIBs 

and CCPs, and participates as a host authority in the work of CMGs for several foreign G-SIBs 

and CCPs. Work through these CMGs allows the FDIC to improve resolution preparedness by 

strengthening our working relationships with key authorities, providing a forum to address 

institution-specific resolution planning considerations, and supporting information-sharing 

arrangements. The FDIC, in collaboration with the FRB, held meetings for all eight U.S. G-SIB 

CMGs in 2023. In collaboration with the Commodity Futures Trading Commission (CFTC) and 

the Securities and Exchange Commission (SEC), the FDIC held meetings for three U.S. CCP 

CMGs in 2023. Due to continued international travel challenges, these meetings were held 

using a mix of hybrid and fully virtual formats.

Joint U.S.–EU Financial Regulatory Forum

FDIC staff participated in three Joint U.S.-EU Financial Regulatory Forum meetings held in 

2023, as a member of the U.S. delegation led by Treasury staff, along with FRB, CFTC, SEC, 

and OCC staff. Staff from the European Commission, European Banking Authority, European 

Securities and Markets Authority, European Insurance and Occupational Pensions Authority, 

European Central Bank, Single Supervisory Mechanism, and Single Resolution Board 

represented the EU. The forum meetings underscored EU and U.S. cooperation and focused 

on a number of themes, such as market developments; current assessments of financial 

stability risks; multilateral and bilateral engagement in banking, regulatory, and supervisory 

cooperation in capital markets; operational resilience and digital finance; and AML/CFT, 

among other topics. Authorities also shared experiences related to the spring 2023 

bank failures.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 65 

U.S.–UK Financial Regulatory Working Group

The FDIC also maintains a close working relationship on cross-border resolution planning 

topics with UK authorities, including through dialogue as a participating agency in the U.S.-

UK Financial Regulatory Working Group (FRWG), which the U.S. Treasury and UK Treasury 

established in 2018 to serve as a forum for bilateral regulatory cooperation between the U.S. 

and the UK. The FDIC participates along with the FRB, OCC, SEC, and CFTC; participating UK 

regulators include the Bank of England and the Financial Conduct Authority. In 2023, the 

FRWG meeting discussion focused on a number of themes, such as international and bilateral 

cooperation, sustainable finance, non-bank financial intermediation, operational resilience, 

cross-border regimes, and resolution-related updates, among other topics. Authorities also 

shared experiences from the spring 2023 bank failures.

Principals Tabletop Exercise Meeting 

In October 2023, senior officials from the FDIC, CFTC, SEC, FRB, and the Bank of England 

convened a hybrid exercise to identify, consider, and discuss key information that would need 

to be shared between authorities, as well as strategic direction and decisions that respective 

authorities would need to make, in a potential scenario where the resolution of a systemically 

important CCP may become necessary. This exercise was conducted as part of a regular series 

of senior-level meetings held since 2017 to share views on CCP resolutions and review the 

progress of an ongoing program of joint work among the agencies.

Senior Staff Exercise 

In June 2023, senior officials from the FDIC, U.S. Treasury, FRB, Federal Reserve Bank of 

New York, OCC, CFPB, SEC, CFTC, the Bank of England, UK Treasury, European Central Bank, 

European Commission, and Single Resolution Board convened a meeting in the continuation 

of a series of exercises and exchanges to enhance the understanding of each jurisdiction’s 

resolution regime for G-SIBs and to strengthen coordination on cross-border resolutions. 

This exercise built on six prior cross-border principal level events going back to 2014, with 

European Banking Union authorities joining in 2016, and addressed lessons learned from 

recent bank failures in each jurisdiction.

Systemic Resolution Advisory Committee

The FDIC created the Systemic Resolution Advisory Committee (SRAC) in 2011 to provide 

advice and recommendations on a broad range of issues relevant to the failure and resolution 

of systemically important financial companies pursuant to the Dodd-Frank Act.

Members of the SRAC have a wide range of experience, including managing complex firms, 

serving as bankruptcy judges, and working in the legal system, accounting, and academia. 

The FDIC held an SRAC meeting in December 2023 that focused on the March bank failures 

and lessons learned, large bank strategy and resolution options, and large bank policy 

considerations.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 66 

Depositor and Consumer Protection

A major component of the FDIC’s mission is to ensure that financial institutions treat 

consumers and depositors fairly, and operate in compliance with federal consumer protection, 

anti-discrimination, and community reinvestment laws. The FDIC also promotes economic 

inclusion to build and strengthen positive connections between insured financial institutions 

and consumers, depositors, small businesses, and communities.

Public Awareness of Deposit Insurance Coverage

Throughout 2023, the FDIC continued its efforts to educate bankers and consumers about 

FDIC insurance coverage.

In October 2023, the FDIC launched a national deposit insurance awareness campaign to 

raise awareness about how it can protect consumers’ money in the event of a bank failure. 

“Know Your Risk. Protect Your Money,” is a consumerfocused campaign that aims to reach those who may 

have lower confidence in the U.S. banking system or who 

are unbanked, as well as those who use mobile payment 

systems, alternative banking services, and financial 

products that may appear to be FDIC-insured but are not.

The campaign features a piggy bank, which is commonly 

associated with money and personal savings, placed in 

potentially risky situations. The campaign consists of 

digital display ads, including web banners, as well as search 

engine marketing and sponsored social media that connect 

consumers to deposit insurance information and resources on the FDIC’s website in English 

and Spanish. The digital campaign ran through November 2023 and resumed in January 2024 

with the start of traditional tax filing season and when many consumers receive 

refund payments.

DEPOSITOR AND CONSUMER PROTECTION RULEMAKING AND GUIDANCE

In 2023, the FDIC made a number of updates to compliance examination principles and 

procedures, including the following:

Small-Dollar Lending

In April 2023, the FDIC published Small-Dollar Lending Examination Procedures, which provide 

a framework for examiners when reviewing small-dollar loan programs. The procedures 

should support examiners in their reviews of small-dollar lending programs that are significant 

in volume or concentration levels. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 67 

Fair Debt Collection Practices Act 

In September 2023, updates were made to this section of the FDIC Compliance Examination 

Manual to reflect the 2020 and 2021 amendments to Regulation F by the CFPB and 

the corresponding interagency examination procedures, including debt collection 

communications.

Fees Arising from Re-Presented Items

In June 2023, the FDIC issued updated guidance to clarify its current supervisory approach 

relating to consumer compliance risks associated with assessing multiple non-sufficient funds 

(NSF) fees arising from the re-presentment of the same unpaid transaction. The updated 

guidance explains that the FDIC will not request that an institution conduct a lookback review 

absent a likelihood of substantial consumer harm.

Overdraft Fees

In April 2023, the FDIC issued guidance to ensure that supervised institutions were aware of 

the consumer compliance risks associated with assessing overdraft fees on a transaction that 

was authorized against a positive balance but settled against a negative balance (APSN). The 

guidance expands on an FDIC 2019 Supervisory Highlights article titled “Overdraft Programs: 

Debit Card Holds and Transaction Processing” by discussing the FDIC’s concerns with both 

the available and ledger balance methods used by institutions when assessing overdraft fees. 

FDIC-supervised institutions should be aware of heightened risks of violations of section 

1036(a)(1)(B) of the Dodd-Frank Act and section 5 of the Federal Trade Commission Act 

when assessing overdraft-related fees on APSN transactions. The guidance also encourages 

institutions to review their overdraft practices to ensure compliance, including overdraft 

programs administered by a third party. 

HMDA’s Closed-End Mortgage Loan Volume Reporting Threshold 

In February 2023, the FDIC issued FIL-06-2023, FDIC Supervisory Approach Regarding Changes 

to HMDA’s Closed-End Mortgage Loan Volume Reporting Threshold, to inform supervised 

institutions of recent changes regarding the Home Mortgage Disclosure Act (HMDA) reporting 

threshold for closed-end mortgage loans and the FDIC’s supervisory approach for enforcing 

related requirements. For FDIC-supervised institutions that meet Regulation C’s coverage 

requirements, the threshold for reporting data on closed-end mortgage loans is now 25 

loans in each of the two preceding calendar years. In addition, for closed-end mortgage data 

collected in the years 2022, 2021, or 2020, the FDIC does not intend to initiate enforcement 

actions or cite HMDA violations for certain failures to report such loan data.

Consumer Compliance Supervisory Highlights

The FDIC issued the Consumer Compliance Supervisory Highlights in March 2023. The purpose 

of this publication is to enhance transparency regarding consumer compliance supervisory 

activities. The publication includes a high-level overview of consumer compliance issues 

identified by the FDIC during the prior year’s supervision of state nonmember banks. 

The Spring 2023 issue includes: a summary of the overall results of the FDIC’s consumer 

compliance examinations of supervised institutions in 2022; a description of the most 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 68 

frequently cited violations and other consumer 

compliance examination observations; information 

on examination observations and regulatory 

developments; a summary of consumer compliance 

resources and information available to financial 

institutions; and an overview of trends in consumer 

complaints that were processed by the FDIC in 2022.

PROMOTING ECONOMIC INCLUSION

The FDIC is committed to expanding economic inclusion in the financial mainstream 

by ensuring that all Americans have access to affordable and sustainable products and 

services from IDIs. The agency’s economic inclusion initiatives are integral to our mission 

of maintaining stability and public confidence in the nation’s financial system. The FDIC 

promotes economic inclusion and community development through collaborations with 

financial institutions and other stakeholders committed to strategic initiatives that positively 

impact LMI communities.

The FDIC developed the first multi-year Economic Inclusion Strategic Plan for the FDIC in 

2014. Since then, the number of unbanked households has reached historic lows, and 

both consumers’ needs and the market for financial services have evolved. In 2023, the 

FDIC updated its Plan to support progress toward a state in which all U.S. households can 

establish, sustain, and benefit from banking relationships to create and grow a strong financial 

foundation. In addition, the updated plan incorporates the findings and recommendations 

of the Office of the Inspector General’s evaluation of the FDIC’s efforts to increase consumer 

participation in the insured banking system. The updated Plan includes a comprehensive 

list of key performance indicators based on the community outcomes the FDIC would like 

to advance. The updated Plan and outcomes measurement framework will be implemented 

in 2024.

Advisory Committee on Economic Inclusion

The Advisory Committee on Economic Inclusion (ComE-IN) provides the FDIC with advice and 

recommendations on important initiatives focused on expanding access to banking services 

for underserved populations. This includes reviewing basic retail financial services (e.g., lowcost, safe transaction accounts; affordable small-dollar loans; and savings accounts). ComEIN members also provide perspectives regarding demand-side factors such as consumer 

perceptions of financial institutions and a broad range of consumers’ financial services needs. 

In 2023, the ComE-IN met and discussed the following topics:

 Opportunities to increase account access through collaborations with federal and 

state programs that distribute government financial assistance; 

 Special purpose credit programs;

 The Economic Inclusion Strategic Plan; 

 Community Reinvestment Act (CRA) modernization efforts; and

 Small-dollar lending.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 69 

Leveraging “Bankable Moments” 

During the COVID-19 global pandemic, the FDIC increased and expanded its messaging about 

the importance of having a bank account to encourage more Americans, particularly those 

in LMI communities, to access government relief payments via direct deposit in a secure 

and timely manner. These efforts contributed to an uptick in bank account ownership, as 

reported in the 2021 FDIC National Survey of Unbanked and Underbanked Households. Among 

the survey’s key insights was that unbanked households can be reached by taking advantage 

of such “bankable moments” (i.e., when they are receiving government payments as part of 

existing federal programs) if they are aware of, and able to locate and open, bank accounts 

that can meet their needs.

In light of this success, in 2023, the FDIC focused on additional opportunities to connect 

consumers to safe and affordable bank accounts for other bankable moments. For example:

 The FDIC partnered with Treasury to include #GetBanked inserts with 6.2 million 

mailed checks to individuals receiving government payments from July through 

October 2023. The inserts indicated the importance of opening a bank account 

and encouraged recipients to visit the FDIC’s #GetBanked webpage to find an 

account and learn more about the benefits of having one. As a result, visits to the 

#GetBanked webpage during this time (August) increased more than 44 percent 

from prior months.

 The FDIC promoted affordable accounts during tax-filing season through 

collaborations with affordable tax preparation services, such as the IRS’s VITA 

program. During this period, the FDIC facilitated national and local events, which 

contributed to at least 35 VITA organizations collaborating with 26 local banks to 

offer affordable accounts.

In addition to these national efforts, the FDIC was featured in the National Association of State 

Treasurers’ digital newsletter, which reaches more than 11,000 subscribers principally from 

state treasurers and state government fiscal officers, to encourage state government agencies 

to help more households access bank accounts. 

COMMUNITY AND ECONOMIC DEVELOPMENT

Alliances for Economic Inclusion

FDIC-led Alliances for Economic Inclusion (AEI) are coalitions of local financial institutions and 

consumer, faith-based, community, and government organizations that support economic 

opportunity, particularly for LMI households and communities and small businesses. The FDIC 

currently manages 12 AEI coalitions, which support working groups of bankers and community 

leaders responding to the financial capability and services needs in their communities. 

In 2023, the Los Angeles AEI coordinated efforts in which 17 banks provided 204 volunteers 

that supported 17 VITA sites, which prepared over 10,000 tax returns, resulting in more than 

$10 million in tax refunds. Many of these VITA sites promoted bank account access and savings. 

One organization’s VITA site, for example, helped over 300 individuals locate and open bank 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 70 

accounts. The Los Angeles AEI was also recognized by America Saves with a Community 

Impact Award because of their successful efforts during America Saves Week 2023, during 

which nearly 500 people made savings pledges totaling nearly $1 million; the median pledge 

was $600. 

In addition, several Milwaukee AEI members launched a pilot program entitled the “Financial 

Health Counselor Network” for leaders from organizations that primarily serve Milwaukee, 

Wisconsin residents who are African American, Hispanic, or Asian and who are unbanked. The 

network mission is to build high-quality financial coaching to enhance social service networks 

serving Milwaukee.

Outreach Highlights

As of December 31, 2023, the FDIC hosted approximately 190 events, providing opportunities 

for financial institutions to collaborate with partners on approaches to increase consumer 

access to a broad range of financial products and services including: bank accounts and 

credit services, affordable mortgages, financial products and services for small businesses; 

as well as efforts to help consumers build savings and improve credit histories. These 

events helped organizations identify and develop collaborations with IDIs that may receive 

favorable consideration under the CRA. For example, Community Affairs events facilitated 

collaborations between banks and community-based organizations that contributed to more 

than $12 million of bank investments in community partners. 

More specifically, throughout the year, the FDIC also coordinated activities to support efforts 

to increase consumer account access to affordable and sustainable bank accounts in LMI 

communities and to encourage more banks to offer these accounts. The FDIC conducted 26 

events in collaboration with members of AEIs, Bank On coalitions, bank trade associations, 

and other community-based organizations across the country. For example, the FDIC hosted a 

webinar to increase awareness of the 2021 FDIC National Survey of Unbanked and Underbanked 

Households, the #GetBanked initiative, and free income tax resources available to LMI 

individuals and small businesses in the Kansas City area through community development 

partnerships. As a direct result of this event, two banks partnered with a local Bank On 

coalition to provide volunteers at VITA sites, two banks provided funding to the Missouri 

University Extension for tax time initiatives, and one bank opened a VITA site at their branch 

and at a local community-based organization.

The FDIC encouraged access to sustainable consumer credit through nine events and provided 

technical assistance to banks and their partners. These activities highlighted credit building/

rebuilding strategies for LMI and minority borrowers, including persons with disabilities, and 

strategies designed to expand access to small-dollar loans. In one instance, the FDIC helped a 

community organization in northwest Indiana develop strategies to approach banks to invest 

in an employer-based small-dollar loan model. As a result, three financial institutions made 

a CRA investment of $40,000 into this loan pool. In addition, nine events focused on Special 

Purpose Credit Programs (SPCPs) recently created by lenders to meet the credit needs of 

economically disadvantaged classes of persons. At one CRA banker interagency roundtable 

in California, presenters discussed SPCP models and sparked interest from at least 15 local 

banks interested in offering SPCPs.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 71 

The FDIC continued to engage with banks, federal agencies, housing counseling agencies, 

and national and regional housing coalitions to expand homeownership programs to 

LMI borrowers in an effort to support a foundation for wealth building. The FDIC held 

13 roundtables and forums that resulted in increased engagement by banks to support 

affordable housing programs, including grants. For example, the FDIC and the Federal Reserve 

Bank of San Francisco co-hosted a community development forum in Hawaii that resulted 

in one bank making an investment of over $4 million to expand homeownership for native 

Hawaiians through a nonprofit organization that will provide interim construction loans with 

no down payment. The same bank committed to providing a $365,000 grant to the nonprofit 

to support the operations of the construction loan fund. Another event in Boston helped 

increase awareness of the Boston Housing Authority’s homeownership programs, resulting in 

20 families becoming first-time homeowners in 2023. 

The FDIC is committed to promoting access to capital for small businesses in underserved 

communities. As of December 31, 2023, the FDIC engaged with banks and community 

organizations through 34 outreach events. These events increased shared knowledge and 

supported collaboration among financial institutions and other community, and small 

business development organizations. In Michigan, the FDIC’s Supporting Black and Brown 

Small Businesses event led to a featured bank committing $600 training scholarships for small 

business clients. In Kansas City, the Expanding Access to Small Business Credit Resources event

resulted in $7,500 in bank donations to nonprofits serving small businesses, while fostering 

five new partnerships between community development financial institutions (CDFIs) 

and banks. 

Also in 2023, the FDIC continued its collaboration with the Small Business Administration 

(SBA) and U.S. Department of Agriculture (USDA) on the “Path to Prosperity” economic 

development series. The series reached small businesses in rural communities, with an 

emphasis on underserved and minority-owned firms. The FDIC co-hosted ten regional small 

business conferences with the SBA and USDA. Information gained through this interagency 

partnership indicated that these conferences were collectively attended (in person or

virtually) by over 1,700 attendees. Registration data indicates that over 1,000 attendees 

identified as small business owners. Participants engaged with financial institutions, technical 

assistance providers, and administrators of federal and municipal small business programs. 

As a result of this interagency collaboration, tracking data indicates 459 small businesses were 

matched to lending, capacity-building, contracting, and technical assistance opportunities. 

The series covered various public programs designed to support small businesses and 

included the participation of 71 state and federal 

agency partners. 

As part of the FDIC’s engagement with Historically 

Black Colleges and Universities (HBCUs) during 2023, 

the FDIC continued participation in the Economic 

Development Cluster, a Federal Interagency Working 

Group of the White House Initiative on HBCUs, to 

host a series of forums to leverage HBCU economic 

assets to expand capital projects, infrastructure, and 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 72 

programming for their growth and advancement. For example, the Chicago Region hosted 

an event at Central State University in Ohio encouraging financial institutions to support 

community development and service opportunities at HBCUs. Also, a webinar in the Kansas 

City Region focused on workforce development opportunities at HBCUs in Missouri. As a 

result of this engagement, the FDIC fostered several new partnerships with banks and federal 

agencies resulting in career opportunities for HBCU students, including a collaboration 

between a bank and Harris-Stowe State University to help HBCU students to obtain 

professional attire as they enter the workforce.

The FDIC also provided banks with CRA technical assistance. This included 33 CRA roundtables 

or forums designed to help banks identify CRA-qualifying collaboration opportunities. One 

event in New England provided insight into how financial institutions and community-based 

organizations can partner with the State Small Business Credit Initiative to access capital 

needed to invest in job-creating opportunities. Following the event, Community Affairs staff 

convened a meeting with the leader of a state bank trade group and a Native American Tribe to 

explore regional bank support for the tribe. 

FINANCIAL EDUCATION AND OUTREACH

Financial education is central to the FDIC’s efforts to expand economic inclusion and promote 

confidence in the banking system. Effective financial education helps people gain the 

skills and confidence necessary to sustain a banking relationship, achieve financial goals, 

and improve financial well-being. For more than 22 years, the FDIC Money Smart financial 

education curricula and supporting resources have offered non-copyrighted, high-quality, free 

financial education training resources for banks, schools, colleges, nonprofits, communitybased organizations, and other stakeholders to meet the financial education needs of people 

of all ages and small businesses. 

The FDIC works to raise awareness about the importance of consumer financial education and 

share its resources through outreach events and activities to consumers and communities 

across the nation. This includes conducting FDIC-led national training webinars and town 

halls, as well as exhibiting and speaking 

at conferences with community leaders, 

practitioners, and other stakeholders. The FDIC 

also maintains resources that help consumers 

and communities understand important 

consumer protection information, such as how 

deposit insurance works, how to resolve issues 

with their banks, and understanding consumer 

financial protection laws and consumer rights.

Money Smart Program

Money Smart instructor-led curricula and self-paced resources are designed to help 

communities and people of all ages by providing practical guidance on how to make 

informed financial decisions, develop a positive banking relationship, and protect against 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 73 

financial scams. Curricula materials are available 

in multiple languages, Braille, and large print. Selfpaced products, which can be accessed by consumers 

directly, complement instructor-led materials delivered

in-person or online. Regular updates ensure that 

Money Smart benefits from user feedback and current 

instructional best practices. The FDIC helps consumers 

and organizations effectively use Money Smart, including 

through over 1,000 Money Smart Alliance members, as 

well as national webinars to the general public. 

How Money Smart Are You? is one of the FDIC’s most 

popular resources with more than 1.8 million views on www.fdic.gov. Since launching How

Money Smart Are You? in September 2021, the FDIC has issued more than 260,000 certificates 

of completion and has more than 75,000 player accounts. More than 94 percent of players who 

access How Money Smart Are You? indicate they learned something from the experience. How

Money Smart Are You? also allows organizations such as schools, colleges, nonprofits, housing 

counseling centers, and banks to create organization accounts. More than 1,200 organizations 

now have accounts so they may track player progress and enhance learning. Organizations 

or individuals interested in learning more about How Money Smart Are You? should contact

the Money Smart financial education team at CommunityAffairs@fdic.gov or visit How Money 

Smart Are You? on www.fdic.gov. In 2023, FDIC launched a formal evaluation of How Money 

Smart Are You? to learn how to make user-focused improvements to the platform.

Outreach and Engagement Highlights 

Throughout 2023, the FDIC held 17 Money Smart Alliance events or meetings online, reaching 

more than 1,200 trainers, or potential trainers, with an in-depth overview of FDIC consumer 

education resources. The FDIC also answered questions and helped organizations with 

tips and strategies for integrating or learning more about the Money Smart curricula. More

than two dozen one-on-one meetings were held with organizations (such as, educators, 

HUD-certified financial counselors, Black, Indigenous, and People of Color (BIPOC)-serving 

organizations, and veterans) looking for additional information about integrating or learning 

more about Money Smart.

In April 2023, the FDIC launched its revamped Money Smart for Young Adults (MSYA) curriculum

during National Financial Capability Month. The new MSYA seeks to help young adults make 

better financial choices early in life that can contribute to a long-lasting, positive impact on 

their financial futures. The webinar also featured the Money Smart Guide to Organizing Reality 

Fairs, designed to help banks and other intermediaries offer youth and young adults a realworld simulation of an adult’s financial life. Since launching in December 2022, MSYA has 

been downloaded more than 3,500 times and viewed online 21,700 times. The Guide to 

Organizing Reality Fairs has been downloaded nearly 4,800 times and received more than 

3,600 page views.

In June 2023, the FDIC worked with the CFPB to conduct a Money Smart Train-the-Trainer and 

Money Smart Alliance national webinar for World Elder Abuse Awareness Day. The FDIC and 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 74 

CFPB highlighted the growing prevalence of scams targeting older adults and how Money 

Smart for Older Adults (MSOA) can be deployed to combat this troubling trend. Visits to the 

CFPB MSOA website increased 1,000 percent compared to the two days immediately prior 

to the event while increasing traffic to the FDIC MSOA website by 25 percent. In March of 

2023, the FDIC MSOA product was featured in a CFPB Webinar series aimed at Combatting 

Elder Financial Exploitation. That event had over 1,464 views by December 31, 2023. And in 

September of 2023, the MSOA was once again featured at a Meet the Bank Regulators event 

hosted by the CFPB and had over 390 individuals in attendance.

As of October 1, 2023, MSOA has been distributed in hard copy to over a million recipients 

during in-person sessions. The American Bankers Association (ABA) Foundation found that 

the MSOA is the number one used Instructor-led curricula, after bank proprietary products 

aimed at preventing financial abuse of older adults. The FDIC also unveiled an updated MSOA 

website, featuring improved navigability of the available resources. 

In 2023, for the first time, MSOA was featured in AARP (formerly, the American Association 

of Retired Persons) publications. The results of a joint study with the AARP on the MSOA was 

completed in 2022 and its findings, released in December 2023, revealed that older adults 

who received the MSOA curriculum demonstrated improved behaviors, skills, confidence, and 

knowledge about financial exploitations scams, even among those who were already highly 

aware of these types of scams. 

Advancing Financial Education and Capability

Throughout 2023, the FDIC continued to support consumer financial education collaborations 

at the local and national levels by providing technical assistance and resources throughout 

the country, with a focus on unbanked and underbanked households and LMI communities. 

In particular, the FDIC continued its efforts to improve the financial capability and economic 

empowerment among BIPOC communities. Highlights of our work in this area are presented 

below.

Juntos FDIC (Together FDIC) Pilot

The Juntos FDIC (Together FDIC) pilot utilizes the Money Smart program to bring financial 

education to more Hispanic-serving organizations (HSOs). The pilot began in January 2023, 

recognizing the importance of increasing access to financial education and financial services 

for the U.S. Hispanic population in response to stakeholder feedback.14

Through Juntos FDIC, the FDIC has established collaborative partnerships with two 

national HSOs with affiliate networks of more than 200+ Hispanic-serving communitybased organizations. Through these partnerships, Juntos FDIC has connected with over 

80 organizations dedicated to strengthening and advancing economic mobility in Latino 

communities. Juntos FDIC conducted two kick-off meetings (in English and Spanish) with 44 

participating organizations. As a result of these interactions, the FDIC forged new relationships 

14 The 2021 FDIC National Survey of Unbanked and Underbanked Households found that Hispanic households 

are unbanked at a rate that is more than twice the national average, and 4.5 times more than white households. 

Additionally, stakeholder feedback (June 2022) indicated a lack of awareness by the U.S. Hispanic population of the 

FDIC’s mission and its economic inclusion resources.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 75 

with 40 HSOs and provided these organizations with technical support and tools to implement 

financial education programs, including delivering Money Smart Train-the-Trainer sessions to 

23 organizations.

The pilot program leverages FDIC professional staff, most bilingual, to deliver financial 

education. As a result, Juntos FDIC delivered the first Money Smart Train- the-Trainer events 

in Spanish (for Money Smart for Small Business and How Money Smart Are You?) within a span 

of six months, and has conducted needs assessment and follow-up meetings with HSOs in 

Spanish. Approximately 217 prospective Money Smart Instructors from 23 HSOs benefited 

from these comprehensive training sessions.

Juntos FDIC also has facilitated collaborations between banks and community organizations 

to increase awareness of resources and to provide technical assistance. For example, one 

pilot participant, an FDIC-supervised state savings bank, requested guidance on how to 

expand outreach and support to a growing population of minority-owned small businesses 

in its market. Juntos FDIC connected the bank with a fellow pilot participant, a local CDFI, 

which shared lessons learned resulting in the organizations establishing a referral-based 

relationship. 

Additional accomplishments from the Juntos FDIC pilot include:

 Onboarded ten FDIC professional staff from across the Corporation on the FDIC 

Money Smart financial education curriculum as Train-the-Trainer instructors;

 Developed an internal online client-relationship management tool to facilitate 

participant follow-up and monitoring;

 Created and translated into Spanish new training materials for Train-the-Trainers 

sessions;

 Provided consulting and technical assistance to community bank staff on 

strategies to develop bank-led financial education programs, targeted outreach 

to minorities and the integration of emerging minority consumer segments into 

financial institutions’ core businesses;

 Deployed financial capability building programs in Puerto Rico, Maryland, 

Pennsylvania, Florida, Illinois, New York, Colorado, Texas, New Jersey, 

Connecticut, South Carolina, North Carolina, Georgia, Delaware, Massachusetts, 

Tennessee, Kansas, and California; and

 Reached more than an estimated 130 Spanish-speaking households since the 

start of the pilot through a range of initiatives, including financial education 

workshops, capacity-building trainings, small business development series, 

financial literacy webinars, and savings club programs.

Collaborations with Federal Agencies 

In 2023, the FDIC continued its active membership on the federal Financial Literacy and 

Education Commission (FLEC). This includes participating on various working groups, notably 

the FLEC Digital Assets, Basic Financial Capability, and Post-Secondary Education working 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 76 

groups. Alongside other FLEC member agencies, the FDIC provided technical assistance and 

contributed resources to the drafting of the U.S. Department of the Treasury report entitled 

The Impact of Climate Change on American Household Finances. 

The FDIC also continued to support and actively participate in the Federal Trade Commission 

(FTC) Stop Seniors Scams Act Advisory Group, which consists of federal agency partners, 

consumer advocates, and industry representatives, as well as state and local governmental

entities, that focus on ways to better identify and stop scams that affect older adults. The 

FDIC’s contributions to the Advisory Group will be included in congressionally-mandated 

reports from the FTC in October 2024. The FDIC is also participating in the Institute of 

Museum and Library Services Interagency Task Force on Information Literacy. The task 

force seeks to facilitate the development of a portal of resources, including Money Smart, 

to bridge information literacy research and practice to advance information literacy within 

communities.

In 2023, the FDIC expanded its collaboration with the U.S. Department of Housing and Urban 

Development (HUD). The agencies jointly hosted a national webinar targeting HUD-assisted 

communities in order to share strategies to support financial education. During the event, 

the FDIC shared information on its Money Smart and How Money Smart Are You? programs 

and #GetBanked Initiative and how the agency works to ensure affordable mortgage lending. 

Through this effort, the FDIC provided resources to over 1,000 attendees.

As a part of its commitments under Interagency Task Force PAVE, in April 2023, the FDIC 

published several public-facing resources to provide education and information to consumers 

and bankers. These included a webpage on www.fdic.gov titled FDIC Tips on Appraisal Bias and 

Valuation to Address Consumers’ Frequently Asked Questions, regulatory updates in Consumer 

Compliance Supervisory Highlights, and an article in the June 2023 issue of FDIC Consumer 

News titled Understanding Appraisals and Why They Matter. In addition, the FDIC’s Information 

and Support Center complaint submission form has been updated to include appraisal-related 

issues.

Consumer News

Consumer News is the FDIC’s monthly newsletter to consumers. It provides practical guidance 

on financial services, including helpful hints, quick tips, links to useful resources, and 

common-sense strategies to protect consumers’ hard-earned dollars.

The FDIC released 12 issues of Consumer News in 2023, addressing some of the biggest 

concerns consumers face, including rising interest rates, crypto-assets, and cybersecurity. 

New areas of discussion in 2023 included banking service products and financial tips for 

individuals with disabilities, what consumers ought to consider when using a nonbank, and 

understanding appraisals in support of the PAVE Interagency Task Force Initiatives. 

The subscriber list continues to grow, surpassing 169,000 in 2023, furthering the outreach to 

communities throughout the country. All Consumer News articles are scheduled for release 

in both English and Spanish during the first week of each month and promoted through 

subscriptions, social media, and the www.fdic.gov website.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 77 

Money Smart News

Money Smart News is a monthly publication that highlights how organizations successfully 

implement and promote the Money Smart curricula and resources. In 2023, Money Smart News

featured nine success stories documenting how financial institutions, educators, nonprofits, 

and other community-based organizations used Money Smart curricula and resources to 

improve the financial well-being of the consumers and communities they serve. New features 

included “Tips and Techniques” and “Reality Fair Toolkit” for youth. Money Smart News is 

distributed to more than 109,000 people interested in delivering financial education to others. 

CONSUMER COMPLAINTS AND INQUIRIES

The FDIC National Center for Consumer and Depositor Assistance (NCDA) is comprised of staff 

from coast-to-coast, with a centrally located hub in the Kansas City Regional Office. The NCDA 

fulfills two mission-critical functions for the FDIC: 1) investigating and responding to consumer 

complaints and inquiries involving FDIC-supervised institutions; and 2) promoting public 

awareness and understanding of FDIC deposit insurance coverage, ensuring depositors and 

bankers have ready access to information regarding deposit insurance rules and requirements.

The FDIC’s NCDA helps consumers by receiving, investigating, and responding to consumer 

complaints about FDIC-supervised institutions and answering inquiries about federal 

consumer banking laws and regulations, FDIC operations, and other related topics. Assessing 

and resolving these matters helps the agency identify trends or problems related to consumer

protections, understand the public perception of consumer protection issues, formulate 

policy that aids consumers, and foster confidence in the banking system.

The FDIC regularly updates metrics on requests from the public for FDIC assistance. The 

webpage is located at https://www.fdic.gov/transparency/consumers.html.

CONSUMER COMPLAINTS BY TOPIC AND ISSUE

Through December 31, 2023, the FDIC closed 20,185 written consumer complaints and 

inquiries. Of these, 10,426 were referred out to other federal banking agencies for review, 

while the FDIC handled the remaining 9,759. The FDIC responded to 98.3 percent of written 

complaints within timeframes established by corporate policy and acknowledged 100 percent 

of all consumer complaints and inquiries within 14 days. The FDIC Annual Performance Goal 

for both metrics is 95 percent and 100 percent, respectively.

The top five identified products among consumer complaints and inquiries about FDICsupervised institutions, as percent of total volume, included credit cards (30 percent of total), 

checking accounts (20 percent), consumer lines of credit and installment loans (16 percent), 

and residential real estate (5 percent).

The top five issues identified among consumer complaints and inquiries, as a percent of 

total volume, included credit reporting (15 percent), disclosures (7 percent), loan forgery/ID 

theft (6 percent), deposit account transaction discrepancies (5 percent), and error resolution 

procedures (5 percent). The FDIC helped consumers receive approximately $7 million in 

refunds and voluntary compensation from financial institutions through December 31, 2023. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 78 

CASES CLOSED 2023 YTD

0 500 1000 1500 2000 2500 3000

Q1

Q2

Q3

Q4

Written Response Referrals Calls

TOP PRODUCTS 2023 YTD

0 200 400 600 800 1000 1200 1400

Q1

Q2

Q3

Q4

Checking

Consumer Lines of Credit

Credit Cards Installment Loans

Residential Real Estate
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 79 

Deposit Insurance Coverage Information Assistance and Outreach 

In order to fulfill its mission to promote public confidence in the banking system, the FDIC 

works to ensure that bankers and consumers have access to accurate information about FDIC 

rules for deposit insurance coverage. Through December 31, 2023, the FDIC’s Contact Center 

handled 88,381 telephone cases pertaining to a variety of issues, including 37,779 that were 

identified as deposit insurance-related inquiries. The majority of deposit insurance inquiries 

are forwarded to the Deposit Insurance (DI) Unit for handling. In addition to the telephone 

inquiries, the FDIC received over 3,900 written deposit insurance inquiries from consumers 

and bankers. Of these inquiries, 100 percent received responses within two weeks, as required 

by corporate policy. FDIC deposit insurance specialists assist depositors in identifying 

potentially fraudulent websites posing as legitimate FDIC-insured institutions. Additionally, 

the FDIC received over 750 inquiries or complaints regarding potentially false or misleading 

statements about FDIC deposit insurance through a complaint portal that was established in 

mid-2022; 100 percent of the complaints received were reviewed by staff in the Legal division. 

The two large bank failures that occurred in March of 2023 resulted in a 565 percent surge 

increase for that month in deposit insurance calls and correspondence received and handled. 

This resulted in just-in-time training of approximately 60 FDIC employees to temporarily 

provide supplemental assistance in handling incoming deposit insurance calls. Through 

December 31, 2023, the FDIC received and handled 34,046 deposit insurance-related calls 

(forwarded from the FDIC Contact Center) and written inquiries combined, the largest number 

of inquiries handled since 2009.

The top five deposit insurance issues identified as a percent of total volume among calls 

and correspondence handled through December 31, 2023, include informal revocable trust 

accounts (26 percent), formal revocable trust accounts (11 percent), single accounts (7 

percent), joint accounts (7 percent) and Electronic Deposit Insurance Estimator (EDIE) inquiries 

(4 percent).

Through December 31, 2023, the FDIC identified and took appropriate action on over 200 

other matters. This number includes actions taken regarding websites that used the Member 

FDIC logo or FDIC name but were not operated by FDIC-member banks, reviews of potential 

violations of section 18(a)(4) of the Federal Deposit Insurance Act,

15 referrals to other 

law enforcement and regulatory agencies for further action, and issuances of cease and 

desist letters. 

Failed Bank Resolution and Receivership Management

Within the FDIC, the Division of Resolutions and Receiverships (DRR) is responsible for 

resolving the failure of IDIs with assets less than $100 billion; the Division of Complex 

Institution Supervision and Resolution (CISR) is responsible for resolving the failure of IDIs 

with assets of more than $100 billion.

15 The Federal Deposit Insurance Act establishes and sets powers, responsibilities, and administration of the FDIC. 

Section 18(a)(4) of the Act states, “No person may represent or imply that any deposit liability, obligation, certificate, 

or share is insured or guaranteed by the Corporation, if such deposit liability, obligation, certificate, or share is not 

insured or guaranteed by the Corporation.”
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 80 

When an IDI fails, the chartering authority typically appoints the FDIC as receiver, and the FDIC 

employs a variety of strategies to ensure the prompt payment of deposit insurance to insured 

depositors and to provide for the least costly resolution transaction to the DIF. No depositor 

has ever experienced a loss on their insured funds as a result of an IDI failure.

INSURED DEPOSITORY INSTITUTION FAILURES

During 2023, there were five IDI failures. Prior to this year, the last IDI failure occurred in 2020. 

For every IDI failure in 2023, the FDIC successfully contacted all qualified and interested 

bidders to market and sell these institutions. In those cases where the failure occurred on a 

Friday, the assuming institution assumed all deposits and all depositors had access to insured 

funds within one business day. In those cases where the failure occurred on any other day of 

the week, depositors had access to insured funds within two business days. Further, there 

were no losses to insured depositors, and no appropriated funds were required to pay insured 

depositors. The following chart provides a comparison of IDI failure activity over the past 

three years.

Failure Activity Dollars in Billions

2023 2022 2021

Total Institutions 5 0 0

Total Assets of Failed Institutions* $532.2 $0 $0

Total Deposits of Failed Institutions* $440.6 $0 $0

Estimated cost of Failure $40.4 $0 $0

Covered by the Special Assessment ($20.4) $0 $0

Estimated Loss to the DIF $20.0 $0 $0

*Total assets and total deposits data are based on the last quarterly Call Report filed by the institution prior to failure.

The five IDI failures in 2023 are discussed below.

Silicon Valley Bank

Silicon Valley Bank (SVB), Santa Clara, California was closed by the California Department of 

Financial Protection & Innovation on March 10, 2023. The FDIC was appointed receiver. At the 

time of closure, SVB had approximately $167 billion in total assets and about $119 billion in 

total deposits. Following the closure, the FDIC created Silicon Valley Bridge Bank, National 

Association. The deposits and substantially all assets and all Qualified Financial Contracts 

were transferred to the bridge bank. The transfer of deposits was completed under the 

systemic risk exception. Generally, such a transaction is subject to the statutory “least cost 

test” requiring that the transaction be less costly to the Deposit Insurance Fund than any other 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 81 

possible transactions, including liquidation of the failed bank. There is an exception to that 

requirement in the event that it is determined that the least costly transaction would have 

serious adverse effects on economic conditions or financial stability. Such a determination 

must be made by the Secretary of the Treasury in consultation with the President, based 

on recommendations by both the FDIC and the Board of Governors of the Federal Reserve 

System. This exception, commonly referred to as the systemic risk exception, was undertaken 

in this case, enabling the FDIC receiver of SVB to transfer all of the deposits, as defined in the 

FDIA, to the bridge bank.

On March 26, 2023, the FDIC entered into a purchase and assumption agreement for the 

deposits and loans of Silicon Valley Bridge Bank, National Association, by First-Citizens Bank & 

Trust Company, Raleigh, North Carolina. The transaction included the purchase of about $72 

billion of Silicon Valley Bridge Bank, National Association’s assets at a discount of $16.5 billion. 

Approximately $90 billion in securities and other assets were retained in the receivership for 

later disposition by the FDIC. In addition, the FDIC received equity appreciation rights in First 

Citizens BancShares, Inc., Raleigh, North Carolina, common stock with a potential value of up 

to $500 million. On March 28, 2023, the FDIC exercised these rights and received the maximum 

proceeds of $500 million. The FDIC and First-Citizens Bank & Trust Company entered into a 

shared-loss transaction on the commercial loans it purchased from the former Silicon Valley 

Bridge Bank, National Association. First-Citizens Bank & Trust Company also assumed all loanrelated Qualified Financial Contracts. The estimated cost of SVB’s failure is approximately 

$21.8 billion of which $19.2 billion will be recovered under the special assessment for a net 

estimated loss to the DIF of $2.6 billion. The exact cost will be determined when the FDIC 

terminates the receivership.

Signature Bank

Signature Bank, New York, New York, was closed by the New York State Department of 

Financial Services on March 12, 2023. The FDIC was appointed receiver. To protect depositors, 

the FDIC transferred the deposits and substantially all of the assets of Signature Bank to 

Signature Bridge Bank, National Association. The transfer of the deposits was completed 

under the systemic risk exception, as described above. Signature Bank had total assets of 

$110.4 billion and total deposits of $88.6 billion as of December 31, 2022.

On March 19, 2023, the FDIC entered into a purchase and assumption agreement for 

substantially all deposits and certain loan portfolios of Signature Bridge Bank, National 

Association, by Flagstar Bank, National Association, Hicksville, New York, a wholly owned 

subsidiary of New York Community Bancorp, Inc., Westbury, New York. The transaction 

included the purchase of about $38.4 billion of Signature Bridge Bank, National Association’s 

assets, including loans of $12.9 billion purchased at a discount of $2.7 billion. Approximately 

$60 billion in loans remained in the receivership for later disposition by the FDIC. By December 

31, 2023, the FDIC had disposed of substantially all of these retained loans. In addition, the 

FDIC received equity appreciation rights in New York Community Bancorp, Inc., common 

stock. On May 16, 2023, the FDIC received $392 million from the sale of the stock, which was 

received upon the FDIC exercising the rights noted above. The estimated cost of Signature 

Bank’s failure is approximately $1.8 billion of which $1.2 billion will be recovered under the 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 82 

special assessment for a net estimated loss to the DIF of $600 million. The exact cost will be 

determined when the FDIC terminates the receivership.

Signature Bank, New York, New York, was the 29th largest bank in the country, and its failure 

constituted the fourth largest bank failure in U.S. history. The FDIC was the primary federal 

regulator of Signature Bank and in late March, the FDIC Chairman commissioned an internal 

review of the agency’s supervision of Signature Bank, and asked the FDIC’s Chief Risk Officer 

(CRO) to produce a report to the FDIC Board of Directors for release to the public. The CRO 

issued the report on April 28, 2023. The report clearly identifies the root cause of Signature 

Bank’s failure as poor management; it also identifies areas where the FDIC’s supervisory 

efforts could have been more timely, forward looking, and forceful. Also, the report includes 

thoughtful recommendations on matters for further study by the FDIC related to examination 

guidance, processes, and resources. The FDIC continues to focus attention and action on 

these recommendations. 

First Republic Bank

First Republic Bank, San Francisco, California, was closed by the California Department 

of Financial Protection and Innovation on May 1, 2023. The FDIC was appointed receiver. 

To protect depositors, the FDIC entered into a purchase and assumption agreement with 

JPMorgan Chase Bank, National Association, Columbus, Ohio, to assume the deposits and 

substantially all of the assets of First Republic Bank. The FDIC and JPMorgan Chase Bank 

entered into two shared-loss transactions on the single family and commercial loans it 

purchased. As of April 13, 2023, First Republic Bank had approximately $229.1 billion in total 

assets and $103.9 billion in total deposits. The estimated cost to the DIF for this failure is about 

$16.7 billion. The final cost will be determined when the FDIC terminates the receivership. The 

resolution of First Republic Bank involved a highly competitive bidding process and resulted in 

a transaction consistent with the least-cost requirements of the FDI Act.

First Republic was the fourteenth largest bank in the country, and the second largest bank 

supervised by the FDIC, and its failure constituted the second largest bank failure in U.S. 

history. In May 2023 the FDIC Chairman commissioned an internal review of the agency’s 

supervision of First Republic led by the CRO. The CRO issued the report on September 8, 2023. 

The report cites a loss of market and depositor confidence, resulting in a bank run following 

the March 2023 failures of Silicon Valley Bank and Signature Bank as the primary cause of 

failure, but notes there were attributes of First Republic’s business model and management 

strategies that made it more vulnerable to interest rate changes and contagion that ensued 

following the failure of SVB. Also, the internal review identifies items for further study focusing 

on FDIC examiner guidance and processes. The FDIC continues to focus attention and action 

on these items.

Heartland Tri-State Bank

Heartland Tri-State Bank, Elkhart, Kansas, was closed by the Kansas Office of the State Bank 

Commissioner on July 28, 2023. The FDIC was appointed receiver. To protect depositors, the 

FDIC entered into a purchase and assumption agreement with Dream First Bank, National 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 83 

Association, of Syracuse, Kansas, to assume the deposits of Heartland Tri-State Bank. The FDIC 

and Dream First Bank entered into a shared-loss transaction agreement on the commercial 

loans it purchased. As of March 31, 2023, Heartland Tri-State Bank had approximately $139 

million in total assets and $130 million in total deposits. The estimated cost to the DIF for 

this failure is $54.2 million. The final cost will be determined when the FDIC terminates the 

receivership. Compared to other alternatives, Dream First Bank, National Association’s 

acquisition was the least costly resolution for the DIF.

Citizens Bank

Citizens Bank, Sac City, Iowa, was closed by the Iowa Division of Banking on November 3, 2023. 

The FDIC was appointed receiver. To protect depositors, the FDIC entered into a Purchase and 

Assumption Agreement with Iowa Trust & Savings Bank, Emmetsburg, Iowa, to assume the 

deposits and purchase essentially all of the assets of Citizens Bank. As of September 30, 2023, 

Citizens Bank had approximately $66 million in total assets and $59 million in total deposits. 

The estimated cost to the DIF for this failure is $14.8 million. The final cost will be determined 

when the FDIC terminates the receivership. Compared to other alternatives, Iowa Trust & 

Savings Bank’s acquisition was the least costly resolution for the DIF.

RECEIVERSHIP MANAGEMENT ACTIVITIES

As part of the receivership process, the FDIC as receiver manages failed IDIs and their 

subsidiaries with the goal of expeditiously winding up their affairs. Assets not sold to an 

assuming institution through the resolution process are retained by the receivership and 

promptly valued and liquidated through different sales channels – cash sales, securitizations, 

and joint venture transactions – to maximize the return to the receivership estate.

As a result of the large IDI failures in 2023, the book value of assets in inventory increased 

to a historical high of $202.3 billion. During 2023, the FDIC engaged in numerous activities 

to liquidate these retained assets. These activities included the exercise and sale of equity 

appreciation rights previously noted, as well as the significant sales of loans and securities 

resulting in total proceeds to the FDIC of over $108.4 billion. The cumulative effect of these 

activities resulted in a total book value of assets in liquidation of $84.6 billion at the end 

of 2023.16

Also, during 2023, for 95 percent of failed institutions, at least 90 percent of the book value 

of marketable assets was marketed for sale within 90 days of an institution’s failure for cash 

sales, and within 120 days for structured sales.

The following chart shows the year-end balances of assets in liquidation by asset type.

16 In January 2024, the FDIC, as receiver for Silicon Valley Bridge Bank, N.A. (SVBB), used structured transactions 

(structured sale of guaranteed notes (SSGNs) and a securitization or collectively, “trusts”) to sell $10.5 billion of 

Ginnie Mae Project Loan Securities and a $36.1 billion Purchase Money Note (PMN) issued by First-Citizens Bank & 

Trust Company (FCB), respectively.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 84 

Assets in Liquidation Inventory by Asset Type Dollars in Millions

Asset Type 12/31/23 12/31/22 12/31/21

Securities $12,917 $5 $7

Consumer Loans 0 0 0

Commercial Loans 10 1 2

Real Estate Mortgages 162 1 2

Other Assets/Judgments 4,237 6 18

Owned Assets 30 0 0

Net Investments in Subsidiaries 622 18 20

Structured and Securitized Assets 66,663 8 43

Total $84,641 $39 $92

Proceeds generated from asset sales and collections are used to pay receivership claimants, 

including depositors whose accounts exceeded the deposit insurance limit. During 2023, 

receiverships paid dividends of $289,519 to depositors whose total deposits were not assumed 

by an acquiring institution and whose accounts exceeded the deposit insurance limit.

Once the assets of a failed institution have been sold and liabilities extinguished, the final 

distribution of any proceeds is made, and the FDIC terminates the receivership. In 2023, 

a total of 65 receiverships were terminated, which resulted in a net decrease of 58 active 

receiverships under management. Further, the FDIC terminated at least 75 percent of 

receiverships that were at least two years old and were not subject to unresolved loss-share, 

structured transaction, environmental, legal, or tax impediments at the start of the year.

The following chart shows overall receivership activity for the FDIC in 2023.

Receivership Activity

Active Receiverships as of 12/31/22 132

New Failed Bank Receiverships17 7

Receiverships Terminated 65

Active Receiverships as of 12/31/23 74

Professional Liability and Financial Crimes Recoveries

The FDIC investigates IDI failures to identify potential claims against directors, officers, 

securities underwriters and issuers, financial institution bond carriers, appraisers, attorneys, 

accountants, mortgage loan brokers, title insurance companies, and other professionals 

who may have caused losses to IDIs that failed and FDIC receiverships. The FDIC pursues 

meritorious claims against these parties that are expected to be cost effective.

17 Silicon Valley Bank and Signature Bank are counted as both a Bridge Bank Receivership and a Failed Bank 

Receivership.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 85 

During 2023, the FDIC recovered $40.8 million from professional liability settlements. The 

FDIC authorized five professional liability lawsuits during 2023. As of December 31, 2023, the 

FDIC’s caseload included 24 professional liability lawsuits (up 9 from 15 at year-end 2022), 

and open investigations in 74 claim areas out of 8 institutions. The FDIC continued to conduct 

investigations of claims out of recently failed IDIs, but no investigations reached the 18-month 

point (an internal goal) after the institutions’ failure dates in 2023.

As part of the sentencing process, for those convicted of criminal wrongdoing against an 

insured institution that later failed, a court may order a defendant to pay restitution or to 

forfeit funds or property to the receivership. The FDIC, working with the Department of Justice 

in connection with criminal restitution and forfeiture orders issued by federal courts and 

independently in connection with restitution orders issued by the state courts, collected $5.1 

million in 2023. As of December 31, 2023, there were 1,601 active restitution and forfeiture 

orders (down 34 from 1,635 at year-end 2022). This includes 11 orders held by the Federal 

Savings and Loan Insurance Corporation (FSLIC) Resolution Fund (i.e., orders arising out of 

failed financial institutions in receivership or conservatorship by the FSLIC or the Resolution 

Trust Corporation).

Minority Depository Institutions and Community

Development Financial Institutions

MINORITY DEPOSITORY INSTITUTION ACTIVITIES

The preservation and promotion of minority depository institutions (MDIs) remains a longstanding, top priority for the FDIC. The FDIC’s research study, Minority Depository Institutions: 

Structure, Performance, and Social Impact, published in 2019, found that MDIs play a vital role 

in providing mortgage credit, small business lending, and other banking services to minority 

and LMI communities. MDIs are anchor institutions in their communities and play a key role in 

building a more inclusive financial system.

Since 2020, significant new sources of private and public funding have become available 

to support FDIC-insured MDIs and Community Development Financial Institutions (CDFIs), 

collectively known as “mission-driven banks.” During 2023, the FDIC pursued several 

strategies to support MDIs. These included: increasing engagement and representation; 

facilitating partnerships to provide new capital and other tools and resources; promoting the 

MDI sector through advocacy; providing outreach, technical assistance, and education and 

training for MDIs; and building internal capacity.

ENGAGEMENT AND REPRESENTATION

The FDIC’s MDI Subcommittee of CBAC is composed of nine diverse MDI executives 

representing all types of MDIs across the country with varying asset sizes and lines of business. 

The FDIC provides a venue for minority bankers to discuss key issues, share feedback on 

program initiatives, and showcase MDI best practices. Representatives from four MDIs 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 86 

also serve on the 18-member CBAC and one serves on the ComE-IN to further bring MDI 

perspectives and issues to the table.

In 2023, the MDI Subcommittee held two in-person meetings. The meetings included 

discussions on topics such as banking and economic conditions, supervisory issues, thirdparty risk guidance, cybersecurity, and an update on the DIF. The meetings also included an 

MDI Spotlight segment that featured three private funds that provide resources to MDIs and 

bank executives sharing experiences with new, unconventional growth opportunities. 

During 2023, the FDIC continued to engage with mission-driven bank trade groups and large 

and regional financial institutions to facilitate effective implementation of some of the new 

resources becoming available to mission-driven banks.

PARTNERSHIPS

The FDIC co-sponsored the biennial interagency MDI and CDFI Bank Conference in November 

2023, along with the FRB and OCC. The conference, MDI and CDFI Bank Partnership Exchange, 

featured opportunities for MDIs and CDFI banks to explore partnership opportunities with 

large and regional banks and other supporting resources. The conference included regulatory 

updates, a panel where various agencies and private sector representatives discussed 

programs and initiatives that could benefit MDIs and CDFI banks, opportunities for attendees 

to engage in one-on-one conversations with federal banking regulatory experts regarding 

supervisory topics, and an update on the modernization of CRA regulations. The conference 

concluded with a networking event where MDIs and CDFI banks had the opportunity to meet 

one-on-one with large and regional banks interested in exploring partnerships supportive of 

mission-driven banks. 

ADVOCACY

It is important to promote the visibility of MDIs, to tell their stories, and showcase the 

important role they play in their communities. In 2023, the FDIC recorded four videos of 

MDI executives sharing their institutions’ “Origin Stories,” highlighting the reasons their 

institutions were formed, and describing how they have served their communities over time. 

In addition, senior agency leaders emphasized the significance of mission-driven banks in 

numerous external speaking engagements and through posts on FDIC social media channels 

and its website.

OUTREACH, TECHNICAL ASSISTANCE, AND EDUCATION

During the year, the FDIC continued efforts to improve communication and interaction 

with MDIs and to respond to the concerns of minority bankers. The agency maintains active 

outreach with MDI trade groups and offers to arrange annual meetings between FDIC regional 

management and each MDI’s Board of Directors to discuss issues of interest. The FDIC 

conducts an annual survey to obtain feedback from MDIs and to help assess the effectiveness 

of the MDI program.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 87 

At the conclusion of each examination of an MDI supervised by the FDIC, the staff is available 

to return to the institution to provide technical assistance by reviewing areas of concern 

or topics of interest to the institution. The purpose of return visits is to assist management 

in understanding and implementing examination recommendations, not to identify new 

problems.

Through its public website (www.fdic.gov), the FDIC invites inquiries and provides contact 

information for any MDI to request technical assistance at any time.

In 2023, the FDIC provided 152 individual technical assistance sessions on approximately 38 

risk management, consumer compliance, and resolution topics, including:

 Applications for branch openings and closures,

 Anti-Money Laundering/Countering the Financing of Terrorism,

 Community Reinvestment Act,

 Compliance Management,

 Capital Planning and Management,

 Current Expected Credit Losses (CECL) accounting methodology,

 Corporate Governance and Strategic Planning,

 Fair Lending,

 Funding and liquidity,

 Home Mortgage Disclosure Act (HMDA),

 Information technology risk management and cybersecurity,

 Internal audit, and

 Unfair or Deceptive Acts or Practices (UDAP).

In response to questions raised by MDIs, the FDIC hosted two interagency technical assistance 

webinars along with the FRB and OCC to discuss supervisory expectations for MDIs and CDFI 

banks awarded funds from the U.S. Treasury Emergency Capital Investment Program and 

other new investments. The webinars addressed bank management’s questions regarding 

the FDIC’s examination approach for FDIC-supervised MDIs and CDFI banks deploying the 

funds. FDIC staff discussed several risk management practices institutions must consider 

when anticipating significant asset growth, expanding into new markets, and developing new 

product offerings. Staff also addressed questions regarding strategic and capital planning 

associated with new investments and awards.

The FDIC also held outreach, training, and educational programs for MDIs through conference 

calls and regional banker roundtables. In 2023, topics of discussion for these sessions included 

many of those listed above, as well as liquidity, interest rate risk and deposit monitoring 

practices, accounting, emerging risks and areas of concern, commercial real estate trends and 

activity, IT vendor management, and industry and customer reactions to bank failures. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 88 

BUILDING INTERNAL CAPACITY

In 2023, the FDIC continued an initiative that started in December 2022, training examiners of 

MDIs on the application of examination standards to the unique business models of MDIs. The 

training provides information and case studies on many of the new funding sources coming 

into MDIs and CDFI banks, as well as information regarding tools to help understand the 

communities served by MDIs. The FDIC also continued quarterly meetings of its interdivisional 

task force on MDIs to share information, identify new opportunities for supporting missiondriven banks, and ensure appropriate resources support program initiatives.

Diversity, Equity, Inclusion, and Accessibility

The FDIC continues its efforts to integrate diversity, equity, inclusion, and accessibility 

(DEIA) in all aspects of its work to support its important mission. Effective DEIA programs 

and initiatives enhance the FDIC’s work to preserve and promote public confidence in the 

U.S. financial system. The agency takes a broad view of diversity and prioritizes fostering an 

inclusive work environment built on mutual trust, respect, and dignity.

In 2023, it became apparent that the agency needed to do more to make employees feel safe, 

valued, and respected. On December 1, 2023, the FDIC issued and began to implement an 

Action Plan for a Safe, Fair, and Inclusive Work Environment that outlines steps the agency is 

taking to address harassment and discrimination in the workplace and support employees. 

The FDIC’s senior leaders are working with staff to execute each initiative in the plan.

In general, the Office of Minority and Women 

Inclusion (OMWI) spearheads the FDIC’s DEIA 

efforts, including implementation of its 2021-

2023 Diversity, Equity and Inclusion Strategic Plan, 

and is a resource to FDIC Divisions and Offices as 

they implement their own DEIA goals. 

Agency-wide, OMWI conducts workforce 

demographic analyses to identify any 

representation gaps and recommends

recruitment and retention strategies to support diverse applicant pools. OMWI also works with 

Divisions and Offices to maintain a model Equal Employment Opportunity (EEO) program by 

providing training and issuing notices to all employees about legal rights and responsibilities. 

In addition, the agency performs outreach and provides technical assistance to ensure the 

fair inclusion and utilization of minority- and women-owned businesses (MWOBs), minorityand women-owned law firms (MWOLFs), and investors in contracting and investment 

opportunities. Further, OMWI collects and evaluates self-assessment information that FDICsupervised institutions submit voluntarily about their diversity-related policies 

and procedures. 

In 2023, the FDIC made further progress in implementing agency DEIA initiatives under its 

DEI Strategic Plan. Specifically, OMWI provided training support, launched empathy training 

for all employees, and continued to work with the FDIC’s Divisions and Offices to help them 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 89 

execute their own DEIA operational plans tailored to their mission and needs. The agency also 

maintained its focus on three strategic areas: 1) implementing workforce DEIA initiatives; 2) 

enhancing Hispanic recruitment and retention; and 3) promoting financial institution diversity. 

WORKPLACE DEIA INITIATIVES

FDIC leadership promotes the vision and business 

case for DEIA by taking action to increase 

workforce diversity, providing avenues to hear 

from employee groups, maintaining equitable 

practices, and fostering an inclusive workforce. 

The FDIC continued to focus attention on 

recruitment and retention diversity initiatives,

support for first-generation professionals, and 

career development programs for the next 

generation of leaders, among several other initiatives designed to maintain a diverse and 

inclusive workforce. 

In 2023, the FDIC made small but promising progress in reducing the gap in its workforce 

participation by individuals who self-identify as Hispanic. Hispanics continue to have a 

lower-than-expected participation rate in the overall workforce and some mission-critical 

occupations as compared to the civilian labor force. The FDIC’s executive-level task force 

established to address challenges for Hispanic recruitment and retention continued to 

develop and implement outreach strategies to diversify the applicant pool for FDIC missioncritical positions. The agency also enhanced strategies designed to address female workforce 

participation, which in 2023 remained below female participation rates in the civilian labor 

force. The FDIC remains committed to recruiting strategically to reach all available talent in the 

labor market, providing advancement opportunities to all current employees, and enhancing 

employee engagement at all levels. 

FINANCIAL INSTITUTION DIVERSITY

Regularly assessing a financial institution’s diversity policies and practices pursuant to 

Section 342 of the Dodd-Frank Act supports a safer, fairer, and more inclusive banking system. 

Bringing together a variety of perspectives, experiences, and skills can foster innovation, 

improve decision making, and achieve better financial performance. Effective diversityrelated policies and programs can help financial institutions meet the diverse interests of 

shareholders, depositors, and the general public. 

In 2023, 157 FDIC-supervised financial institutions voluntarily participated in the diversity selfassessment (DSA) and submitted information for the 2022 reporting period. This represents 

an 8.7 percent decrease from the previous reporting period. Throughout the year, the FDIC 

continued its outreach to community banks and trade associations to increase awareness of 

and participation in the DSA. In support of this objective, the FDIC also launched a new office 

hours initiative to provide more hands-on technical assistance to the financial institutions.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 90 

MINORITY- AND WOMEN-OWNED BUSINESSES

The FDIC has focused on identifying barriers that underserved communities and individuals 

may face in taking advantage of FDIC procurement and contracting opportunities. In 2023, 

to promote economic inclusion, the FDIC conducted outreach to MWOBs on contracting 

opportunities and provided technical assistance to educate prospective vendors on FDIC 

programs, policies, and procedures. The FDIC continued to support increased participation of 

MWOBs by conducting market research and outreach to identify MWOBs eligible to compete 

for FDIC contracts. Further, the FDIC held Pitch Days to give MWOBs the opportunity to 

highlight their business capabilities, which helped connect MWOBs to OMWI. 

MWOB participation in 2023 FDIC contracting opportunities was strong. The FDIC awarded 

197 contracts (31.1 percent) to MWOBs out of a total of 634 issued. Total awarded contracts 

had a combined value of $1,331.2 million, of which $376.0 million (28.2 percent) went to 

MWOBs. The FDIC paid $171.4 million of its total contract payments (24.5 percent) to MWOBs 

under 317 contracts.

DIVERSE LEGAL SERVICE PROVIDER OUTREACH

The FDIC Legal Division had several major accomplishments relating to increasing diversity 

in legal contracting in 2023. This year the Legal Division hosted a Pitch Day to afford diverse 

MWOLFs, diverse attorneys at majority firms, and legal support services providers an 

opportunity to share their legal expertise and support capabilities. Legal support services 

providers assist in e-discovery, court reporting, trial preparation, expert consultation and 

testimony, and other areas in support of the Legal Division’s mission. 

In addition, the FDIC promoted meaningful relationship building between outside counsel and 

in-house attorneys responsible for engaging outside counsel through outreach events held 

by affinity organizations and bar associations. In particular, the Legal Division partnered with 

the National Association of Minority and Women Owned Law Firms (NAMWOLF) to reach out 

to prospective MWOLFs to match those firms to the FDIC’s anticipated need for outside legal 

services. The Legal Services and Special Contracts Group (LSSCG) also periodically provided a 

reference list of newly available legal services providers, highlighting MWOLFs and MWOBs for 

Legal Division personnel. 

Further, the Legal Division published an internal monthly newsletter, In the Spotlight, to 

encourage referrals of legal contracting opportunities to MWOLFs and other diverse legal 

services providers. Each issue of In the Spotlight highlighted the expertise of an individual 

diverse legal services provider. Recruitment and utilization of diverse legal services providers 

remained a prominent part of the periodic training that LSSCG provided to Legal Division 

personnel.

As a result of these initiatives, the FDIC made 21 referrals to MWOLFs, which accounted for 

almost 7 percent of all legal referrals. The FDIC paid more than $960,000 in legal fees to 

MWOLFs and paid more than $4.9 million to diverse attorneys. Although the Legal Division 

does not pay diverse attorneys directly, they are credited with the amount they bill on behalf 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 91 

of their firms. Taken together, the FDIC paid more than $5.9 million to MWOLFs and diverse 

attorneys out of more than $24.3 million spent on outside counsel services. This represents an 

aggregate 24 percent diversity participation rate in outside legal contracting.

HISTORICALLY BLACK COLLEGES AND UNIVERSITIES ENGAGEMENT

In 2023, the FDIC continued to implement a plan for outreach to HBCUs and their students 

focused on three long-term goals: 1) develop and promote free, high-quality financial 

education to strengthen consumer financial capability and sustainable banking relationships; 

2) inform HBCU students and graduates about career opportunities within the FDIC’s 

workforce, including paid internships and leadership positions; and 3) build and strengthen 

positive connections between insured financial institutions and HBCUs. 

The Consumer and Community Affairs Section of DCP strengthened its connections with 

HBCUs through in-person events on HBCU campuses and webinars. Through these events, 

the FDIC promoted homeownership opportunities, financial education, and economic 

development. Several events provided a forum for HBCU students and administrators to 

engage with financial institutions and featured presentations by HBCU officials.

The FDIC regularly engaged 

with HBCU students at career 

and recruitment fairs hosted 

by individual HBCUs. Also, to 

highlight economics career 

pathways, the FDIC hosted a 

Careers and Networking Event 

for students in the American 

Economic Association Summer 

Program held at Howard 

University. 

Attendees included students 

from Howard University, North 

Carolina Agricultural & Technical 

State University, and Spelman College. A panel of FDIC leaders shared insights on the mission 

of their respective economics-related section, available career opportunities, and desirable 

skills. A networking lunch provided a forum for students to engage with FDIC personnel who 

are in the early stages of their careers.

FDIC participation in the 2023 National HBCU Week Conference addressed all three of the 

agency’s HBCU outreach goals. A Money Smart exhibit highlighted the newly updated Money 

Smart for Young Adults curriculum for ages 16-24, the How Money Smart Are You? suite of 14 

online interactive financial capability games, and other resources. HBCU representatives were 

able to request a special organization account to use for their financial education initiatives at 

no charge. The FDIC also participated in the 2023 National HBCU Week Conference Career and 

Recruitment Fair, where HBCU students and alumni engaged with recruiters.

Aerial view of Howard University
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 92 

At the HBCU conference, the FDIC convened a panel with the directors of the Offices of 

Minority and Women Inclusion of several agencies and a Small Business Administration 

official. The panel presented information to entrepreneurs about doing business with the 

agencies and discussed ways to highlight company capabilities and successfully compete for 

agency contracts. In addition, agency personnel provided one-on-one technical assistance 

and shared practical information with the entrepreneurs.

Information Technology Modernization

Information Technology is an essential component in virtually all FDIC business processes. The 

integration of IT and business processes provides opportunities for efficiencies and requires 

both an awareness and mitigation of potential risks. 

MIGRATION TO THE CLOUD 

In 2023, the FDIC made progress on its Cloud Infrastructure Migration project, which is 

composed of Cloud Setup, Back-Up Data Center (BDC) Phase Out, Cloud Data Management 

and Analytics (CDMA), and Data Orchestration and Integration for Applications (DOIA). 

Cloud Set-up 

The Cloud Platform project is comprised of the foundational components that will deliver both 

infrastructure and application services, and will support the migration of the BDC applications 

to the cloud. The Platform team is responsible for creating the cloud platform, while the BDC 

Phase Out teams are responsible for onboarding critical applications onto the cloud platform. 

In tandem with the DOIA and CDMA teams, the cloud Platform/BDC Phase Out projects will 

deliver the foundational components to better support 

the computing, services, and business needs of the FDIC. 

During 2023, the Chief Information Officer Organization 

(CIOO) developed a Database Platform Licensing Strategy 

white paper to outline a cost savings approach and 

alternative cloud technologies. The CIOO conducted 

a Cloud Infrastructure Migration project strategy 

workshop to redefine the program’s overall strategy, 

vision, objectives, scope, and outcomes and identify four strategic work streams: Program 

Governance, Outreach and Adoption, Capability and Capacity Building, and Onboarding and 

Operations. 

Back-Up Data Center Phase Out 

The BDC provides failover/back-up capabilities for the IT assets required to support the 

FDIC Primary Mission Essential Function (PMEF) responsibilities. The primary goal of the 

phase-out program is to remove the dependency of on-premises infrastructure that host 

the PMEF applications. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 93 

During 2023, the FDIC successfully demonstrated that mission-essential and mission-critical 

services remained available on Azure platforms during failover activities. A full test of the 

FDIC’s Business Continuity and Disaster Recovery capabilities was conducted in October, one 

result of which was to strengthen the back-up plan to recover systems, infrastructure, and 

data after a potential catastrophic event. Some applications reduced failover/failback activity 

from 12 hours to 1 hour. Additionally, a policy was developed and successfully implemented 

to shut down non-production servers after hours and weekends, resulting in material cost 

savings.

Cloud Data Management and Analytics 

The CDMA Program will establish a strategic, enterprise data management and data analytic 

capability for the FDIC with secure, modern, data technologies in the cloud. CDMA is a 

comprehensive, multi-year program led by the 

FDIC’s Chief Data Officer Staff, and includes services 

that span Data Strategy, Cloud Technology, Modern 

Data Architecture, Innovation to Production, Data 

Governance, Education Coordination, and FDIC 

Business Division Partnership. 

In 2023, the CIOO completed the initial design, 

architecture, and development of the new Machine 

Learning (ML) and Natural Language Processing 

(NLP) capability in the CDMA Enterprise Data Lake Capability Development environment. With 

the use of CDMA, FDIC Divisions and Offices data management and data analytics information 

was migrated to enable them to create new business capabilities that will improve FDIC data 

and mission delivery decisions.

Data Orchestration and Integration for Application 

DOIA provides engineering support to the Cloud Infrastructure Migration project and other 

efforts involving migrating applications, data, and workloads to the cloud. It also involves 

mitigating dependencies for on-premises infrastructure, and developing modern processes to 

manage data throughout the organization. In 2023, DOIA continued to support the movement 

of data and applications to the cloud, which resulted in easy access to data and advanced data 

analysis of Mission Essential/Mission Critical (ME/MC) applications. CIOO continues to work 

with the Divisions and Offices to modernize data analytic platforms.

MODERNIZING OBSOLETE SYSTEMS

In 2023, the FDIC published its 2027 Target State Architecture to strengthen the resilience of

its IT infrastructure through intelligent automation and use of cloud-smart technologies, 

proactively reducing the risk of cyber-attacks against the FDIC IT infrastructure, increasing 

staff access to the corporate data, and delivering new/modernized capabilities with speed 

and scale. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 94 

To meet the demands of an ever-evolving regulatory environment, the FDIC envisions 

operationalizing an Adaptive IT Architecture that can be redesigned by the business lines 

to meet changing needs. This year, comprehensive multi-year business roadmaps were 

compiled to facilitate effective IT investment decisions by identifying strategic objectives 

with high impact for appropriately prioritizing the use of limited IT resources. An analysis 

of the complete application portfolio was also initiated to identify the need to retire or 

replace legacy and unsupported technology platforms. In addition, the FDIC established a 

standardized framework and guidance to streamline development and implementation of 

custom web-based applications which will reduce the number of supported infrastructure 

configurations.

RMS Business Process Modernization (BPM)

RMS BPM is a program whose goal is to provide RMS users and external stakeholders with a 

streamlined solution that will focus on delivering automated, end-to-end supervision business 

processes using a cloud-based, business process management platform. The planned solution 

will improve the efficiency and effectiveness of RMS supervision programs by delivering a 

single cloud-based solution that captures end-to-end business processes, improves data 

quality and security, improves internal and external information sharing, and facilitates 

greater use of AI/ML. In 2023, the FDIC completed its effort to define the business, technical, 

and compliance requirements for this project, and to procure funding. CIOO and RMS will 

continue to work together to begin development in 2024.

Enhancing Data Governance 

In 2023, the FDIC established its cloud-based Enterprise Data Lake Capability, which serves as 

the foundation for modernizing enterprise data management and data-driven mission delivery

using new cloud-based advanced data analytics capabilities. The FDIC’s Enterprise Data 

Lake Capability establishes cloud-based capabilities that enable its data to be managed and 

used as an enterprise resource. The Enterprise Data Lake Capability also provides advanced 

self-service data analytics to support modernizing data-based decision making and improve 

mission delivery.

Also in 2023, the FDIC’s Failed Bank Data System developed and deployed new technologies 

and capabilities to support the resolution of three large complex financial institutions. 

The program expanded the current FDIC boundary to incorporate a Government Cloud 

Component, enabling increased scalability options, particularly for hardware and both longterm and short-term storage. In addition, it supported FDIC Legal with over 300 cases and 

subpoenas related to open bank matters and receiverships.

In addition, the FDIC advanced its artificial intelligence program in 2023. Specifically, it 

established an AI Use Case Inventory (as required by the National Defense Authorization Act 

of 2023) as a central repository for FDIC AI use cases to provide visibility on AI activities across 

the Corporation. In response to evolving technology, the FDIC established a cross-functional 

Generative AI Working Group to evaluate Generative AI benefits and risks as an integral part 

of the FDIC AI Governance framework. The program also published the FDIC NIST AI Risk 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 95 

Management Framework (RMF) Evaluation with recommendations on managing AI risks, 

collaborating with more than 20 volunteers across FDIC Divisions and Offices to perform 

evaluations and identify recommendations that can help the FDIC manage AI risks.

Adoption of Agile Software Development 

The FDIC subscribes to “agile” practices when it comes to software development, which 

involves an ongoing process of continuous software code releases and customer feedback. 

In 2023, the CIOO made significant progress to adopt agile software development methods, 

including the formation of the Agile Working Group (AWG) whose goal is to accelerate the 

movement from projects to products. The AWG identified key incremental and iterative steps 

(change management, process, development experience, metrics, and product management) 

to aid in product completion. In addition, the AWG has made substantial progress in training 

leadership and staff, communicating change, establishing key metrics, identifying areas of 

opportunity, and highlighting successes. 

Also in 2023, the CIOO conducted its first Product Management Workshop to educate agile 

teams on the future adoption of a product model18; three of these teams were successful in 

moving to the product model. Starting in 2024, two of the Agile teams’ products will be piloted 

using the product management model. CIOO plans to onboard additional teams depending on 

agile maturity and team stability. CIOO is also creating of a product management playbook, 

which will allow agile teams to reference their journey from project to product management.

DEVSECOPS: Integration of Security Throughout Development Lifecycle 

The FDIC’s DevSecOps initiative is focused on providing product teams with a development 

platform that allows them to quickly implement enhancements; to support small, frequent 

releases; to minimize defects; and to quickly resolve any issues in the production environment. 

Successful milestones were achieved when the source code tool was implemented on the 

FDIC’s Azure Cloud Computing Platform. Along with this, the tool the FDIC uses to curate, 

secure, and deliver software code was migrated to Azure. The application which proactively 

scans the software code for vulnerabilities was deployed to production at the same time. 

The migration to these tools and applications has allowed several teams to have projects in 

the FDIC’s cloud-based service for software development and version control platform. In 

addition, a native DevSecOps tool for Salesforce platform to manage releases and deployment 

was migrated and deployed.

INFORMATION TECHNOLOGY SECURITY

Zero Trust 

Zero Trust is an IT security model that requires identity verification for every person and 

device trying to access resources on a private network, regardless of whether they are sitting 

within or outside of the network perimeter. It provides security against ransomware and 

cybersecurity threats, and all federal agencies are required to adopt a Zero Trust Architecture 

18 A Product Model is a foundational organizing framework to align the technology team with business strategy and 

objectives.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 96 

per Executive Order.19 In 2023, FDIC achieved significant milestones in the adoption of Zero 

Trust principles to safeguard its operations and the critical data it manages. By advancing 

foundational Zero Trust capabilities, the FDIC continues to improve its enterprise security 

posture and enhance process and capabilities to provide secure and accurate data access. 

Identity, Credential, and Access Management (ICAM)

In 2023, the FDIC made advancements in ICAM technologies that contributed to our success in 

adopting Zero Trust principles. Our progress with respect to ICAM technologies will enable the 

FDIC to have a comprehensive view of all users, centralize the verification of user identities, 

and provide expanded identity proofing for business entities and public users. These 

technologies will help reduce burden on the FDIC to manage identities and credentials, 

allow quick detection of irregular behavior, and provide public users a secure way to access 

FDIC systems.

International Outreach

The FDIC takes a leadership role in supporting the global development of deposit insurance, 

bank supervision, and bank resolution systems. In 2023, this included working closely with 

regulatory and supervisory authorities from around 

the world, as well as international standard-setting 

bodies and multilateral organizations, such as the 

International Association of Deposit Insurers (IADI), 

the Association of Supervisors of Banks of the 

Americas (ASBA), the Basel Committee on Banking 

Supervision (BCBS), the Financial Stability Board 

(FSB), the International Monetary Fund (IMF), and 

the World Bank. The FDIC engaged with foreign 

regulatory counterparts by hosting foreign officials, 

conducting training seminars, delivering technical assistance, and fulfilling the commitments 

of FDIC membership in international organizations. The FDIC also advanced policy objectives 

with key jurisdictions by participating in high-level interagency dialogues.

International Association of Deposit Insurers

The FDIC continued its leadership at IADI in 2023. FDIC officials and experts continued to 

support IADI programs, including reviewing and providing input on the Core Principles 

for Effective Deposit Insurance Systems (Core Principles). The FDIC serves as a member of 

IADI’s Executive Council, Core Principles and Research Council Committee, Reimbursement 

Technical Committee, and the Regional Committee of North America. Additionally, the FDIC 

chairs the Training and Technical Assistance Council Committee and the Capacity Building 

Technical Committee.

19 In May of 2021, the President issued Executive Order (EO) 14028, Improving the Nation’s Cybersecurity, initiating 

a sweeping Government-wide effort to ensure that baseline security practices are in place, to migrate the Federal 

Government to a Zero Trust architecture, and to realize the security benefits of cloud-based infrastructure while 

mitigating associated risks.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 97 

During the year, the FDIC contributed to IADI’s second thematic review – a high-level view of 

the membership’s self-reported compliance with four of the 16 Core Principles. The Capacity 

Building Technical Committee provided support for developing and facilitating virtual and inperson workshops for the Africa, Asia-Pacific, Caribbean, European, Eurasian, Latin American, 

and North American regions of IADI, among other activities. With FDIC support, IADI technical 

assistance and training activities reached more than 1,298 participants.

During 2023, the FDIC supported IADI’s Governance Working Group, which realigned IADI’s 

structure. Additionally, the FDIC participated in a joint IADI – FSB Resolution Steering Group 

(ReSG) meeting. Finally, FDIC Chairman Gruenberg provided a keynote speech at the IADI 

Annual Conference in September in Boston, MA.

Association of Supervisors of Banks of the Americas

The FDIC continues to support ASBA’s mission to promote sound banking supervision and 

financial stability by actively supporting ASBA’s leadership and contributing to its training 

and research programs. Committed to strengthening ASBA’s leadership, in 2023 the FDIC 

was represented on ASBA’s board of directors with the FDIC Director of International Affairs 

beginning a two-year term as the North America Director. The FDIC also serves on the Training 

Committee and Working Groups on Financial Technology and climate-related financial risk.

Basel Committee on Banking Supervision

The FDIC supports and contributes to the development of international standards, guidelines, 

and sound practices for prudential regulation and supervision of banks through its 

longstanding membership in the BCBS. The FDIC’s contributions include actively participating 

in many of the committee groups, working groups, and task forces established by the BCBS 

to carry out its work, which focuses on policy development, supervision and implementation, 

accounting, and consultation. Particular areas of focus are capital policy, accounting, 

operational risk, stress testing, and anti-money laundering.

International Deposit Insurance and Resolution Capacity Building

The FDIC’s direct assistance programs to enhance global understanding of best practices in 

deposit insurance, bank supervision, and bank resolution were provided both virtually and 

in person during the year. In 2023, FDIC officials and staff were able to share their expertise 

with more than 325 individuals, representing more than 60 jurisdictions. The FDIC provided 

technical assistance to multiple ASBA members through virtual courses on Operational Risk 

and Model Risk and an in-person course on Banking Crisis and Resolution.

Outreach included hosting two virtual training programs, Virtual FDIC 101, which provides a 

high-level overview of the Corporation’s key activities as a bank supervisor, deposit insurer, 

and resolution authority for 150 participants representing 57 organizations and a new 

program on Setting a Deposit Insurance Fund Target for 25 participants representing 

25 jurisdictions.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 98 

Effective Management of Strategic Resources

The FDIC must effectively manage its human, financial, and technological resources to 

successfully carry out its mission and meet the performance goals and targets set forth in its 

annual performance plan. The FDIC must align these strategic resources with its mission and 

goals and deploy them where they are most needed to enhance its operational effectiveness 

and minimize potential financial risks to the DIF.

HUMAN CAPITAL MANAGEMENT

The FDIC’s human capital management programs are designed to attract, develop, reward, 

and retain a highly skilled, diverse workforce. In 2023, the FDIC’s workforce planning initiatives 

emphasized the need for enhanced succession management strategies to reduce the risk of 

vacancies in key positions and ensure the Corporation has a talent pipeline with the capability 

to successfully deliver the FDIC’s mission today and into the future.

STRATEGIC WORKFORCE AND SUCCESSION MANAGEMENT

The FDIC faces a steady stream of projected retirements over the next five to ten years. In 

addition, the banking industry is experiencing rapid and significant change, which impacts 

the knowledge and skills needed within the FDIC’s future workforce. The FDIC is proactively 

preparing for these shifts in talent requirements. The FDIC understands that effective strategic 

workforce and succession planning are critical to ensure that gaps in employee aspiration, 

engagement, and readiness for senior leadership and technical positions are identified 

and addressed.

In 2023, the FDIC formally established a Human Capital Strategic Planning and Analysis unit 

within the Division of Administration with dedicated resources to identify a Corporate-wide, 

sustainable approach to address its talent pipeline challenges. The FDIC has re-confirmed 

its leadership competencies and has begun to develop content for leadership role profiles 

that will provide the basis for selection, assessment, and development of the talent pipeline, 

aligned with the Corporation’s strategic direction. This initiative will produce robust career 

paths that illustrate options for job movement within the FDIC and developmental options 

to be competitive for different positions, which will create more transparency and empower 

employees to effectively plan their career development. Over time, the enhancements to

assessments, development, and selection processes will result in more qualified candidates 

in our talent pools and more objective hiring practices for leadership positions. This effort will 

help the Corporation develop and maintain a talent pipeline with the skills, experience, and 

motivation to lead.

The FDIC also implemented a corporate-wide Career Aspirations Survey to understand 

employees’ aspiration levels and the factors that influence their pursuit of leadership roles. 

The results are being used to inform additional succession strategies. To gain insights into 

retention issues, the FDIC implemented a new Corporate Exit Survey and also developed a 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 99 

retention management dashboard that provides enhanced analyses of workforce data. The 

FDIC’s data-driven, research-based approach to succession management will give leaders a 

more accurate understanding of strengths and weaknesses in the talent pool.

Through these efforts, the FDIC workforce will be even better positioned to respond to 

dynamic financial and technological challenges, now and in the future.

EMPLOYEE LEARNING AND DEVELOPMENT

The FDIC has a robust program to train and develop its employees throughout their careers 

to enhance technical proficiency and leadership capacity, supporting career progression 

and succession management. In 2023, the FDIC leveraged its modernized training center and 

learning management system to fully support the return to in-person classroom training and 

an increase in examiner hiring.

The FDIC develops and implements comprehensive curricula for its business lines to prepare 

employees to meet new challenges. Employees working to become commissioned examiners 

or resolutions and receiverships specialists attend 

a prescribed set of specialized, internally developed 

and instructed courses. Post-commission, employees 

continue to further their knowledge in specialty areas 

with more advanced courses. The FDIC is revising 

examiner classroom training to better support 

an on-the-job application and has developed a 

wide-ranging resolution and receivership training 

curriculum to support readiness.

The FDIC also offers a comprehensive leadership development program that combines core 

courses, electives, and other enrichment opportunities to develop employees at all levels, 

and support succession planning and diversity, equity, inclusion, and accessibility goals. From 

new employees to new executives, the FDIC provides employees with targeted opportunities 

that align with key leadership competencies. In addition to offering a broad array of internally 

developed and administered courses, the FDIC provides its employees with funds to 

participate in external training to support their career development.

In 2023, the FDIC’s Corporate University delivered nearly 140 in-person course offerings to 

more than 2,700 participants, as well as more than 155 virtual course offerings to more than 

8,000 participants.

EMPLOYEE ENGAGEMENT

Employee engagement plays an important role in empowering employees and helps maintain, 

enhance, and institutionalize a positive workplace environment. The FDIC strives to be an 

employer of choice, and continually evaluates its human capital programs and strategies to 

ensure that all of its employees are fully engaged and aligned with the mission. The FDIC uses 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 100 

the Federal Employee Viewpoint Survey mandated 

by Congress to solicit feedback from employees, 

and takes an agency-wide approach to address key 

issues identified in the survey. 

The FDIC engages employees through the Workplace 

Excellence (WE) Program and other formal channels 

such as the Chairman’s Diversity Advisory Councils 

and Employee Resource Groups; and informally 

through working groups, team discussions, 

listening sessions, and daily employee-supervisor interactions. In addition, the FDIC-National 

Treasury Employees Union (NTEU) Labor Management Forum (LMF) serves as a mechanism 

for the union and employees to have pre-decisional input on workplace matters. WE and LMF 

enhance communication, provide additional opportunities for employee input, and improve 

employee engagement.