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Message 

from the 

Chairman

Donald E. Powell 

James Kegley

Our Priorities

★ Stability

★ Sound Policy

★ Stewardship
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On behalf of the Federal Deposit Insurance Corporation (FDIC), I am pleased 

to present the 2003 Annual Report. During 2003, our focus was to promote 

the stability of the financial services industry, develop and effectively articulate

sound policy, and research and administer corporate operations in a manner 

consistent with good stewardship of the deposit insurance funds. It gives me

great pleasure to highlight just a few of our major achievements in 2003:

● We established an inter-divisional Risk Analysis Center (RAC) to identify, 

quantify, and respond more quickly and effectively to existing and emerging 

risks to the deposit insurance funds. The RAC allows us to better coordinate 

risk-monitoring efforts and action plans among the various business units of 

the FDIC. It brings together economists, bank examiners, financial analysts 

and others involved in assessing risk to the banking industry and the deposit 

insurance funds.

● We continued to expand the Money Smart program to promote financial 

literacy among low and moderate-income Americans outside of the financial 

mainstream. The Money Smart curriculum is now available in English, 

Spanish, Chinese and Korean. Since the rollout of Money Smart a little over 

two years ago, we have trained over 5,000 volunteer instructors and taught 

over 100,000 people. The FDIC has taken the lead in establishing partnerships

with community groups and bankers to link services such as applying for 

Earned Income Tax Credit (EITC) funds, offering free tax preparation services 

and other incentives to promote and provide financial education. As a result 

of these partnerships, we have seen nearly 14,000 previously unbanked 

consumers establish new bank accounts. In 2003, we were honored to receive

the Partnership for Public Service’s prestigious Service to America Business

and Commerce medal for our efforts in this area. 

● We established the Center for Financial Research (CFR) to encourage and 

support innovative research on topics that are important to the FDIC’s role 

as deposit insurer and bank supervisor. The CFR is a partnership between 

the FDIC and the academic community, with prominent scholars integrally 

involved in managing and directing its research program. The research 

sponsored by the CFR will explore key developments affecting the banking 

industry, risk measurement and management methods, regulatory policy 

and other topics of interest to the FDIC and the larger financial community. 

The CFR provides financial support for researchers outside of the FDIC to 

undertake relevant projects in selected program areas, and provides a forum 

for exchanging ideas among regulators, academicians and financial industry 

representatives. The CFR will be organizing research roundtables, workshops 

and discussion groups on issues critical to the business of the FDIC. 

● We joined with other regulators in a multi-year interagency effort under 

the leadership of FDIC Vice Chairman John Reich to eliminate outdated or 

unnecessary regulations that impose costly, time-consuming burdens on the 

banking industry, in accordance with the Economic Growth and Regulatory 

Paperwork Reduction Act (EGRPRA). During the past year the federal banking

agencies issued an EGRPRA Federal Register notice seeking industry and 

public comment on the regulatory review program and the first set of 

regulations subject to this review. 
● We reached an agreement with our Federal Financial Institutions Examination 

Council (FFIEC) partners to build and implement a new internet-based Central 

Data Repository (CDR) for Call Reporting and other regulatory reports. The 

CDR will employ cutting edge technology based on the XBRL (Extensible 

Business Reporting Language) data standard. This system will reduce the 

reporting burden on the industry while simultaneously providing high quality, 

more timely data to regulators, financial institutions and the public. 

● Again this year, we made progress toward the enactment of comprehensive 

deposit insurance reform legislation that would combine the deposit insurance

funds, give the FDIC greater managerial control over the combined funds 

and protect the level of deposit insurance coverage by indexing it to inflation. 

I testified before the House Financial Services Committee and the Senate 

Banking Committee in support of the FDIC’s deposit insurance reform 

proposals. The House passed reform legislation in April by a vote of 411 

to 11. The FDIC will continue to focus attention on this important issue 

during the second session of the 108th Congress.

● We completed implementation of an internet portal, FDICconnect, to facilitate

the electronic exchange of information between the FDIC and its insured 

institutions and began to make initial use of it for the electronic filing of 

branch applications by insured institutions and Beneficial Ownership Reports 

by directors, officers, and principal shareholders of insured financial institutions. 

In addition, quarterly assessment invoices were made available to insured 

institutions for the first time through FDICconnect. 

● We completed a comprehensive Information Technology (IT) Program 

Assessment and named a Chief Information Officer (CIO) who will provide 

leadership in improving our IT program. The new CIO will ensure that our 

corporate-wide information technology needs are met in a cost-effective 

manner, and that our information systems meet the highest security standards.

● We appointed the FDIC’s first Chief Learning Officer and five Deans to provide

leadership for our new Corporate University (CU). The CU was established 

to help our employees keep pace with changes in the banking industry, broaden

their perspectives, sharpen their job skills, and enhance their leadership 

expertise. 

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As Chairman, I will continue to work diligently with the dedicated men and

women of the FDIC to support the stability of the banking industry, promote

sound banking policy, and be an effective steward of the insurance funds. The

FDIC has helped to provide financial stability in the U.S. banking industry for 

70 years, and in that time, not one penny of federally-insured depositors’ money

has ever been lost. We are proud of that accomplishment and committed to 

continuing that record in 2004.

Sincerely,

Donald E. Powell