ANNUAL 

REPORT

2015
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ANNUAL 

REPORT

2015
2 FEDERAL DEPOSIT INSURANCE CORPORATION

FEDERAL DEPOSIT INSURANCE CORPORATION

550 17th Street NW, Washington, DC 20429 OFFICE OF THE CHAIRMAN

February 18, 2016

Dear Sir,

In accordance with:

• the provisions of Section 17(a) of the Federal Deposit Insurance Act,

• the Chief Financial Officers Act of 1990, Public Law 101-576, 

• the Government Performance and Results Act of 1993 (as amended) and the GPRA 

Modernization Act of 2010,

• the provisions of Section 5 (as amended) of the Inspector General Act of 1978, and 

• the Reports Consolidation Act of 2000, 

the Federal Deposit Insurance Corporation (FDIC) is pleased to submit its 2015 Annual Report

(also referred to as the Performance and Accountability Report), which includes the audited financial statements 

of the Deposit Insurance Fund (DIF) and the Federal Savings and Loan Insurance Corporation (FSLIC) 

Resolution Fund (FRF). 

In accordance with the Reports Consolidation Act of 2000, the FDIC assessed the reliability of the performance 

data contained in this report. No material inadequacies were found, and the data are considered to be complete 

and reliable. 

Based on internal management evaluations, and in conjunction with the results of independent financial 

statement audits, the FDIC can provide reasonable assurance that the objectives of Section 2 (internal 

controls) and Section 4 (financial management systems) of the Federal Managers’ Financial Integrity Act of 

1982 have been achieved, and that the FDIC has no material weaknesses. In addition, the U.S. Government 

Accountability Office did not identify any significant deficiencies in the FDIC’s internal controls for 2015. 

We are committed to maintaining effective internal controls corporate-wide in 2016. 

Sincerely,

Martin J. Gruenberg

Chairman

The President of the United States

The President of the United States Senate

The Speaker of the United States House of Representatives
ANNUAL REPORT 2015 3

TABLE OF CONTENTS

Message from the Chairman ........................................................................................................ 5

Message from the Chief Financial Officer................................................................................. 11

I. Management’s Discussion and Analysis ........................................................................... 13

The Year in Review.............................................................................................................. 15

Overview.....................................................................................................................................15

Implementation of Key Regulations ...........................................................................................15

Deposit Insurance........................................................................................................................19

Activities Related to Systemically Important Financial Institutions ..............................................21

Supervision .................................................................................................................................26

Receivership Management ...........................................................................................................44

International Outreach ...............................................................................................................47

Minority and Women Inclusion ..................................................................................................50

Effective Management of Strategic Resources...............................................................................52

II. Performance Results Summary ......................................................................................... 57

Summary of 2015 Performance Results by Program ....................................................................59

Performance Results by Program and Strategic Goal ....................................................................61

Prior Years’ Performance Results ..................................................................................................68

III. Financial Highlights ............................................................................................................ 77

Deposit Insurance Fund Performance .........................................................................................79

IV. FDIC Budget and Spending ................................................................................................ 83

Corporate Operating Budget .......................................................................................................85

2015 Budget and Expenditures by Program.................................................................................86

Investment Spending ...................................................................................................................87

V. Financial Section................................................................................................................. 89

Deposit Insurance Fund (DIF) ....................................................................................................90

FSLIC Resolution Fund (FRF)..................................................................................................111

Government Accountability Office Auditor’s Report..................................................................120

Management’s Report on Internal Control over Financial Reporting .........................................127

Management’s Response to the Auditor’s Report........................................................................128

VI. Corporate Management Control..................................................................................... 129

Management Report on Final Actions .......................................................................................131

VII. Appendices ........................................................................................................................ 135

A. Key Statistics........................................................................................................................137

B. More About the FDIC.........................................................................................................150

C. Office of Inspector General’s Assessment of the Management and Performance 

Challenges Facing the FDIC ...............................................................................................159

D. Acronyms.............................................................................................................................166
INSURING DEPOSITS • EXAMINING AND SUPERVISING 

INSTITUTIONS • 

MANAGING RECEIVERSHIPS • EDUCATING CONSUMERS

In its unique role as deposit insurer of banks and savings associations, and in cooperation 

with the other state and federal regulatory agencies, the FDIC promotes the safety and 

soundness of the U.S. financial system and insured depository institutions by identifying, 

monitoring, and addressing risks to the Deposit Insurance Fund (DIF).

The FDIC promotes public understanding and the development of sound public policy 

by providing timely and accurate financial and economic information and analyses. It 

minimizes disruptive effects from the failure of financial institutions and assures fairness 

in the sale of financial products and the provision of financial services.

The FDIC’s long and continuing tradition of excellence in public service is supported 

and sustained by a highly skilled and diverse workforce that continuously monitors and 

responds rapidly and successfully to changes in the financial environment. 

At the FDIC, we are working together to be the best.
5

For 82 years, the FDIC has carried out its mission 

of maintaining public confidence and stability in 

the nation’s 

financial system. 

The FDIC does 

this by insuring 

deposits; 

supervising 

and examining 

financial 

institutions 

for safety, 

soundness, 

and consumer 

protection; 

and managing 

receiverships 

when banks fail.

At the end of September 2015, the FDIC insured 

deposits of $6.4 trillion in more than half a billion 

accounts at almost 6,300 institutions, supervised 

3,995 institutions, and managed 470 active 

receiverships having total assets of $23.9 billion.

The U.S. economy and the banking industry 

continued to improve in 2015. After experiencing the 

most severe financial crisis and economic downturn 

since the 1930s, the United States is now well into the 

recovery. The economy is expanding, although the 

pace of economic growth has been weaker than the 

long-term trend and bank profitability remains lower 

than pre-crisis levels. Still, the industry has been 

strengthening balance sheets, building capital, and 

enhancing liquidity. 

Stronger balance sheets indicate ample capacity for 

FDIC-insured institutions to continue to support the 

economic recovery. During the 12 months ended 

September 30, loan balances at banks increased by 

$482 billion, the largest 12-month dollar gain since 

the year ending June 2008. Moreover, that growth 

was broad-based, with all major loan categories 

posting increases, and more than three-quarters of 

all institutions reporting larger loan balances. Loan 

growth was strongest at community banks, which 

posted an 8.5 percent gain versus 5.9 percent for the 

industry overall. Rising loan demand and a recent 

pickup in the pace of economic activity are creating 

favorable conditions for FDIC-insured institutions, 

although the global economic outlook remains 

uncertain and poses a potential downside risk for the 

U.S. economy and financial system. 

The number of both failed and problem institutions 

declined again in 2015, and the Deposit Insurance 

Fund (DIF) balance, which was almost $21 billion in 

the red during the financial crisis, was $72.6 billion in 

the black at year-end.

The FDIC is working to wind down the receiverships 

of failed institutions and to address the emerging 

supervisory challenges of interest-rate risk, credit risk, 

and cybersecurity threats. This shift is indicative of 

the move from a post-crisis recovery environment 

to one of expanding economic growth and financial 

activity. Following is an overview of the key strategic 

challenges facing the FDIC. 

REBUILDING THE DIF, 

RESOLVING FAILED BANKS, 

AND FDIC RESOURCES

Under a restoration plan that reflects Dodd-Frank Act 

requirements to rebuild the DIF, the FDIC has had 

a steady increase in the year-end fund balance from 

2011 through 2015. Recently, lower than estimated 

losses for past bank failures, together with assessment 

income, have contributed to the increase in the fund 

balance to $72.6 billion as of December 31, 2015. 

The reserve ratio was 1.09 percent as of September 30, 

2015. 

The Dodd-Frank Act raised the minimum reserve 

ratio of the DIF from 1.15 percent to 1.35 percent 

and requires that the reserve ratio reach that level by 

September 30, 2020. Further, the Dodd-Frank Act 

MESSAGE FROM THE CHAIRMAN

MESSAGE FROM THE CHAIRMAN
6 FEDERAL DEPOSIT INSURANCE CORPORATION

also makes banks with $10 billion or more in total 

assets responsible for the increase from 1.15 percent 

to 1.35 percent. Under a rule adopted by the FDIC 

in 2011, regular assessment rates for all banks will 

decline when the reserve ratio reaches 1.15 percent. 

Banks with total assets of less than $10 billion will 

have substantially lower assessment rates then. To 

ensure that the reserve ratio reaches 1.35 percent by 

the statutory deadline, the FDIC proposed a rule 

in 2015 that would impose on banks with at least 

$10 billion in assets a surcharge of 4.5 cents per 

$100 of their assessment base, after making certain 

adjustments. The FDIC expects the reserve ratio 

– the ratio of the DIF balance to estimated insured 

deposits - would likely reach 1.35 percent after 

approximately two years of payments of the proposed 

surcharges.

Bank failures in 2015 totaled eight, down dramatically 

from a peak of 157 in 2010, while the number of 

banks on the problem bank list (banks rated 4 or 5 

on the CAMELS rating scale) fell to 203 at the end of 

September 2015 from a high of 888 in March 2011. 

The United States is now approaching pre-crisis levels 

for failed banks and problem banks. 

As the banking industry continues to recover, 

the FDIC requires fewer resources. The agency’s 

authorized workforce for 2015 was 6,886 full-time 

equivalent positions compared with 7,200 the year 

before. The 2015 Corporate Operating Budget was 

$2.3 billion, a decrease of 3.0 percent from 2014.

The FDIC reduced its budget for 2016 from the 

prior year by 4.7 percent to $2.2 billion and reduced 

authorized staffing by approximately 4.6 percent to 

6,569 positions, in anticipation of a further drop in 

bank failure activity in the years ahead. However, 

contingent resources are included in the budget 

to ensure readiness should economic conditions 

unexpectedly deteriorate.

During 2015, the FDIC successfully used various 

resolution strategies to protect insured depositors of 

failed institutions at the least cost to the DIF. The 

FDIC actively marketed failing institutions and sold 

them to other financial institutions. These strategies 

protected insured depositors and preserved banking 

relationships in many communities, providing 

depositors and customers with uninterrupted access 

to essential banking services. 

IMPLEMENTING THE FDIC’S 

AUTHORITIES UNDER THE 

DODD-FRANK ACT 

The FDIC continues to make progress in developing a 

framework under the Dodd-Frank Act for the orderly 

failure of a large, complex, systemically important 

financial institution while avoiding the taxpayer 

bailouts and the market breakdowns that took place 

during the recent financial crisis. 

Under the Dodd-Frank Act, bankruptcy is the 

statutory first option for the failure of a Systemically 

Important Financial Institution (SIFI). The largest 

bank holding companies, as well as non-bank financial 

companies designated by the Financial Stability 

Oversight Council for supervision by the Federal 

Reserve Board, are required to prepare resolution 

plans, also referred to as “living wills,” under Title 

I of the Dodd-Frank Act. These living wills must 

demonstrate that the firm could be resolved under 

bankruptcy without severe adverse consequences 

for the financial system or the U.S. economy. As 

a backstop, for circumstances in which an orderly 

bankruptcy might not be possible, Title II of the 

Dodd-Frank Act provides the Orderly Liquidation 

Authority. This public resolution authority allows the 

FDIC to manage the orderly failure of the firm.

The Living Wills Process

The FDIC and the Board of Governors of the 

Federal Reserve System are charged with reviewing 

and assessing each firm’s plan. If a plan does not 

demonstrate the firm’s resolvability, the FDIC and the 

Federal Reserve may jointly determine that it is not 

credible or would not facilitate an orderly resolution 

of the company under the Bankruptcy Code and issue 

a notice of deficiencies. 

In August 2014, the FDIC and the Federal Reserve 

Board delivered individual letters to the largest 
MESSAGE FROM THE CHAIRMAN 7

financial firms that identified common shortcomings 

of the plans. These shortcomings included 

assumptions that the agencies regard as unrealistic 

or inadequately supported, and the failure to make, 

or even to identify, the kinds of changes in firm 

structure and practices that would be necessary to 

enhance the prospects for orderly resolution. The 

firms were directed to address these shortcomings and 

improve their resolvability including by simplifying 

and rationalizing their organizations, ensuring the 

continuity of critical services in resolution, and 

demonstrating operational capabilities for resolution 

preparedness. The 2015 plans were submitted on July 

1 and were under review by the FDIC and the Federal 

Reserve at year-end.

The living wills submitted by firms also include 

public portions. Public and market understanding 

of the process for improving the resolvability of 

Global Systemically Important Financial Institutions 

(G-SIFIs) is important for a number of reasons, 

including allowing for the development of realistic 

market expectations about how the resolution of a 

G-SIFI might proceed. In the past year the agencies 

provided guidance to the firms requiring that the 

public portions of the plans include more detailed 

information in a number of areas. As a result, 

this year’s public plans provide substantially more 

information. 

The Orderly Liquidation Authority

Given the challenges and the uncertainty surrounding 

any particular failure scenario, Title II of the DoddFrank Act provides the Orderly Liquidation Authority, 

which is effectively a public-sector bankruptcy process 

for institutions whose resolution under the U.S. 

Bankruptcy Code would pose systemic concerns. 

The Orderly Liquidation Authority is the mechanism 

for ensuring that policymakers will not be faced with 

the same poor choices they faced in 2008. Its tools are 

intended to enable the FDIC to carry out the process 

of winding down and liquidating the firm, while 

ensuring that shareholders, creditors, and culpable 

management are held accountable and taxpayers do 

not bear losses. In the years since enactment of DoddFrank, the FDIC has made significant progress in 

developing the operational capabilities to carry out a 

resolution if needed. 

Further, since passage of the Dodd-Frank Act, other 

major jurisdictions have followed the United States 

in enacting systemic resolution authorities that are 

comparable to those provided in the Dodd-Frank Act. 

Pursuant to provisions of the Orderly Liquidation 

Authority, the FDIC has worked closely with all the 

major foreign jurisdictions, including the United 

Kingdom, Germany, France, Switzerland, and Japan, 

as well as European entities including the new Single 

Resolution Board and Single Supervisory Mechanism. 

This cooperation is essential to identifying issues and 

to addressing obstacles to cross-border resolution.

In 2014, the European Parliament established a Single 

Resolution Mechanism (SRM) for the resolution of 

financial institutions in Europe. The FDIC is actively 

engaging with the new Single Resolution Board, which 

oversees the SRM, to be of assistance in its set up 

and to discuss cooperation and resolution planning 

for G-SIFIs with assets and operations in the United 

States and the Eurozone. The FDIC and the European 

Commission have established a joint Working Group 

to focus on both resolution and deposit insurance 

issues. In addition, the FDIC participates in the Crisis 

Management Groups for G-SIFIs with significant 

assets and operations in the United States. Deepening 

our cross-border relationships with the key foreign 

jurisdictions will be an ongoing priority for the FDIC’s 

work on systemic resolution.

Large Bank Deposit Insurance Determinations

In April, the FDIC issued an Advance Notice of 

Proposed Rulemaking (ANPR) that sought comment 

on some approaches aimed at improving the way 

deposit insurance determinations could be done at 

banks with a large number of deposit accounts—

not just banks that are part of SIFIs, but any bank 

with a large number of deposit accounts. Providing 

depositors with prompt access to their funds is 

essential for preserving public confidence and 

maintaining financial system stability. For the typical 

bank resolved by the FDIC, insured deposits are 
8 FEDERAL DEPOSIT INSURANCE CORPORATION

available the next business day. The questions and 

alternatives in the ANPR were aimed at bolstering the 

FDIC’s capability to make equally prompt deposit 

insurance determinations at banks with a large 

number of deposit accounts, such as two million 

accounts. 

Interest-Rate Risk and Credit Risk

While there were a number of positive trends in the 

banking industry, there are signs of growing interestrate risk and credit risk that warrant attention. In 

order to mitigate the impact of low rates on net 

interest margins, banks have been going out further 

on the yield curve and increasing the mismatch 

between asset and liability maturities. Lending in 

higher-risk loan categories has been growing. The 

recent Shared National Credits review of large 

syndicated loans noted that “credit risk in the 

portfolio remains high, despite a relatively favorable 

economic environment.” And loan portfolios in 

regions that depend on oil and gas revenue are 

increasingly at risk due to the significant decline in 

energy prices.

At the same time risk profiles have been rising, 

banks have not seen corresponding growth in 

overall revenue.

These signs of growing interest-rate risk and credit 

risk are important because – as history tells us – it 

is during this phase of the credit cycle when lending 

decisions are made that could lead to future losses. 

Timely attention by banks to address these growing 

risks will benefit banks and contribute to the 

sustainability of the current economic expansion. 

These risks will continue to be a focus of supervisory 

attention.

REGULATORY REVIEW

The Economic Growth and Regulatory Paperwork 

Reduction Act of 1996 (EGRPRA) requires that 

regulations adopted by the federal banking agencies, 

including the FDIC, be reviewed by the agencies at 

least once every 10 years. The current cycle began in 

late 2014 and will end in 2016 when a final report 

is sent to Congress. The purpose of this review is 

to identify outdated or unnecessary regulations and 

consider how to reduce regulatory burden on insured 

depository institutions while, at the same time, 

ensuring that safety and soundness and consumer 

compliance standards are maintained. The FDIC 

in 2015 hosted and participated in public outreach 

meetings nationwide to hear firsthand from bankers 

and consumer groups.

The regulatory review process is one we take very 

seriously. A particular interest to the FDIC is the 

impact of our regulations on community and rural 

banks. As the EGRPRA process unfolded in 2015, 

we worked with the other agencies through the 

Federal Financial Institutions Examination Council 

(FFIEC) on a multi-step process to review Call Report 

burden and the real estate appraisal standards. The 

agencies anticipate taking further actions prior to the 

issuance of the final report. 

COMMUNITY BANKING 

INITIATIVE

Community banks are critically important to our 

economy and banking system. Community banks 

account for 13 percent of the banking assets in the 

United States, but also account for 44 percent of 

the small loans to businesses and farms made by all 

banks, making them key partners in supporting local 

economic development and job creation. Since the 

FDIC is the primary federal supervisor of the majority 

of community banks in the United States, community 

banking will continue to be an important focus of 

FDIC supervision, technical assistance, and research.

In late 2012, the FDIC published a comprehensive 

study on community banking. The study confirmed 

that the traditional community bank business model 

– careful relationship lending, funding from stable 

core deposits, and local market expertise – performed 

comparatively well during the recent banking crisis. 

Of the more than 500 banks that failed since 2007, 

the highest failure rates were among non-community 

banks and community banks that departed from this 
MESSAGE FROM THE CHAIRMAN 9

traditional model by investing in risky assets funded 

by non-core deposits.

In 2015, FDIC analysts published a new study on the 

challenges and opportunities facing small, closely held 

community banks. 

Apart from research, the community bank initiative 

includes a robust technical assistance program for 

bank directors, officers, and employees. The FDIC’s 

latest innovation is a series of more than 20 online 

videos that are helping community bankers to 

understand better their management responsibilities. 

During 2015, new videos were released on interestrate risk, corporate governance, cybersecurity, vendor 

management, the loan originator compensation rule, 

and mortgage servicing rules. 

Finally, the FDIC’s Advisory Committee on 

Community Banking is an ongoing forum for 

discussing current issues and receiving valuable 

feedback from the industry. The committee, which 

met three times during 2015, is composed of 15 

community bank CEOs from around the country. It 

is a valuable resource for input on a wide variety 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.

CYBERSECURITY

The rapidly evolving nature of cybersecurity 

risks reinforces the need for regulators, financial 

institutions, and critical technology service providers 

to have appropriate procedures to effectively respond 

to cybersecurity risk. The FDIC works with other 

bank regulators to analyze and respond to emerging 

cyber threats, bank security breaches, and other 

harmful or disruptive technology-related incidents. 

The federal banking agencies are currently reviewing 

security readiness at banks and technology service 

providers. We are also evaluating our supervisory 

policies for potential improvements.

The FDIC has taken a number of actions to raise 

awareness of cyber risks and to encourage practices 

to protect the banks we supervise, particularly 

community banks. For example, in 2015 the FDIC 

distributed to all FDIC-supervised banks three 

new videos that are part of our Cyber Challenge: 

a Community Bank Cyber Exercise series; added 

a cyber-awareness video to the Directors’ Resource 

Center; and hosted a cybersecurity teleconference for 

the industry. Cyber Challenge provides operational 

risk-related scenarios and challenge questions designed 

to facilitate discussion and allow community bankers 

to assess their preparedness for and response to 

cyber-related events. The FDIC, in coordination 

with other members of the FFIEC, also published a 

Cybersecurity Assessment Tool to help institutions 

identify risks and determine their preparedness. 

The voluntary tool includes a process for measuring 

cybersecurity preparedness over time. 

The FDIC monitors cybersecurity issues on a 

regular basis through on-site bank examinations and 

regulatory and intelligence reports. The FDIC also 

works with other federal agencies, law enforcement 

and a number of government groups and industry 

coordinating councils to facilitate collaboration and 

information sharing across the financial services 

sector.

PROTECTING CONSUMERS 

AND EXPANDING ACCESS 

TO BANKING SERVICES

Expanding access to mainstream banking services 

is part of the FDIC’s core mission. The FDIC’s 

National Survey of Unbanked and Underbanked 

Households, conducted every two years with the 

U.S. Census Bureau, has documented that a large 

number of households in our country do not have a 

relationship with an insured depository institution or 

rely on high cost alternative financial service providers 

to meet some of their financial services needs. The 

survey, which was last released in October 2014, is 

widely used by the industry, academics, government, 

consumer and community organizations, the media, 

and many others to better understand who lacks 

access to mainstream banking services in the United 
10 FEDERAL DEPOSIT INSURANCE CORPORATION

States and to gain insights into opportunities to 

expand participation.

During 2015, the FDIC continued its efforts to 

protect consumers and expand access to mainstream 

banking services. A new national effort, for example, 

was launched to promote local outreach and awareness 

of safe accounts. These safe accounts, which are 

offered by banks with branches in counties where 

nearly 80 percent of Americans live, provide secure, 

affordable transaction services. The accounts follow 

the standards for a Model SAFE account developed 

by the FDIC’s Advisory Committee on Economic 

Inclusion. The advisory committee, composed of 

bankers, community and consumer organizations 

and academics, also began the process of determining 

how mobile banking technologies could help expand 

economic inclusion in the banking system and 

explored opportunities to address the financial services 

needs of individuals with disabilities.

The FDIC has a longstanding commitment to 

financial education. In 2015, we added a new Money 

Smart for Young People curriculum series to the 

recently enhanced Teacher Online Resource Center. 

This age-appropriate resource involves educators, 

parents/caregivers, and young people in the learning 

process, including through the use of Parent/Caregiver 

Guides that are available in English and Spanish. 

Since financial education can be enhanced through 

hands-on learning approaches, we expanded a pilot 

to 21 participating banks that combine the offer of a 

savings account with financial education programs for 

young people. And along with the Financial Literacy 

and Education Commission and other regulatory 

agencies, the FDIC issued guidance that encourages 

banks to offer youth savings programs and answers 

related frequently asked questions. Entrepreneurs can 

also benefit from an enhanced Money Smart for Small 

Business curriculum, which is now also available in 

Spanish.

CONCLUSION

During 2015, the U.S. banking industry continued its 

recovery from the recent financial crisis. The industry 

benefited from stronger balance sheets, fewer problem 

banks and bank closings, increased lending activity, 

and a larger balance in the DIF. At the same time, 

it remains important for bankers and supervisors to 

heed the lessons of the recent crisis by maintaining a 

steady focus on risk management. 

In 2016, the FDIC will continue to work to fulfill its 

mission of maintaining public confidence and stability 

in the nation’s financial system. The workforce 

of the FDIC remains committed to the agency’s 

core mission. I am very grateful to the dedicated 

professionals of the FDIC for their commitment to 

public service and for the high level at which they 

carry out their important responsibilities. 

Sincerely,

Martin J. Gruenberg
MESSAGE FROM THE CHIEF FINANCIAL OFFICER 11

I am pleased to present 

the FDIC’s 2015 Annual 

Report (also referred to 

as the Performance and 

Accountability Report). 

The report covers financial 

and program performance 

information, and 

summarizes our successes 

for the year. The FDIC 

takes pride in providing 

timely, reliable, and meaningful information to its 

many stakeholders.

For 24 consecutive years, the U.S. Government 

Accountability Office (GAO) has issued unmodified 

(unqualified) audit opinions for the two funds 

administered by the FDIC: the Deposit Insurance 

Fund (DIF) and the Federal Savings and Loan 

Insurance Corporation (FSLIC) Resolution Fund 

(FRF). We take pride in our responsibility and 

demonstrate discipline and accountability as stewards 

of these funds. We remain proactive in the execution 

of sound financial management and in providing 

reliable financial data.

The DIF balance (the net worth of the Fund) 

rose to a record $72.6 billion as of December 31, 

2015, an increase of $9.8 billion over the year-end 

2014 balance of $62.8 billion. The Fund balance 

increase was primarily due to assessment revenue and 

reductions in estimated losses for current and prior 

year bank failures.

FINANCIAL AND PROGRAM 

RESULTS FOR 2015

For 2015, DIF comprehensive income totaled $9.8 

billion, a decrease of $5.8 billion over the 2014 

comprehensive income of $15.6 billion. This decrease 

was primarily due to a $6.0 billion difference in the 

provision for insurance losses -- a negative $2.3 billion 

in 2015 compared to a negative $8.3 billion in 2014. 

Assessment revenue was $8.8 billion in 2015 and $8.7 

billion in 2014. Interest on U.S. Treasury obligations 

totaled $423 million as compared to $282 million in 

2014; at the end of 2015, the yield to maturity on the 

DIF portfolio was 0.94 percent.

In 2015, the FDIC continued its efforts to reduce 

operating costs and prudently manage the funds that 

it administers. The FDIC Operating Budget for 2015 

totaled approximately $2.3 billion, which represented 

a decrease of $73 million (3 percent) from 2014. 

Actual 2015 spending totaled approximately $2.1 

billion. On December 15, 2015, the FDIC Board 

of Directors approved a 2016 Corporate Operating 

Budget totaling $2.2 billion, down $108 million 

(5 percent) from the 2015 budget. Including 2016, 

the annual operating budget has declined for six 

consecutive years, consistent with a steadily 

declining workload.

The FDIC continues to reduce staffing levels, as 

conditions in the banking industry improve and 

the FDIC requires fewer resources. The FDIC’s 

authorized full-time equivalent staffing dropped in 

2015 from 7,200 to 6,886, a 4 percent reduction. 

In 2016, we project further reductions in the overall 

workforce. However, we will maintain a workforce 

capable of handling our supervision, insurance, and 

resolution functions.

In 2015, eight banks failed, down from 18 in 2014. 

Even though the number of bank failures is relatively 

low, we will continue to prudently manage the risks 

to the DIF, including interest rate, fiscal, and global 

economic risks. We will remain focused on sound 

financial management techniques, and maintain our 

enterprise-wide risk management and internal control 

program.

Sincerely,

Steven O. App

MESSAGE FROM 

THE CHIEF FINANCIAL OFFICER
12 FEDERAL DEPOSIT INSURANCE CORPORATION

FDIC SENIOR LEADERS

Seated (left to right): Vice Chairman Thomas M. Hoenig and Chairman Martin J. Gruenberg.

Standing 1st Row (left to right): Barbara Hagenbaugh, Segundo Pereira, Doreen R. Eberley, Arleas Upton Kea, and Craig R. Jarvill. 

2nd Row (left to right): Barbara A. Ryan, Arthur J. Murton, Stephen A. Quick, Cottrell L. Webster, Mark E. Pearce, and Martin D. 

Henning. 3rd Row (left to right): Diane Ellis, Steven O. App, Eric J. Spitler, Bret D. Edwards, Russell G. Pittman and Charles Yi.

Not pictured: Kymberly K. Copa, Lawrence Gross, Suzannah L. Susser, Robert D. Harris, Fred W. Gibson, Christopher J. Farrow, and 

Andy Jiminez.
I. MANAGEMENT ’S DISCUSSION 

AND ANALYSIS

13

I.

Management’s

Discussion 

and Analysis
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MANAGEMENT'S DISCUSSION AND ANALYSIS 15

OVERVIEW

The FDIC continued to fulfill its mission-critical 

responsibilities during 2015. The agency adopted and 

issued final rules on key regulations under the DoddFrank Wall Street Reform and Consumer Protection 

Act (Dodd-Frank Act) and engaged in several 

community banking and community development 

initiatives. Cybersecurity remained a high priority for 

the FDIC in 2015; the agency worked to strengthen 

cybersecurity oversight, help financial institutions 

mitigate increasing risks, and respond to cyber threats. 

The sections below highlight these and some of our 

other accomplishments during the year.

IMPLEMENTATION OF 

KEY REGULATIONS 

Capital Rulemaking and Guidance 

The revised capital rules, which generally 

implemented Basel III international capital standards 

and addressed the removal of references to external 

credit ratings as standards of creditworthiness, 

became effective for community banks on January 1, 

2015. The FDIC and other federal banking agencies 

continued efforts to implement the revised capital 

rules, including finalizing regulatory reporting, 

making technical corrections to the rule, and issuing 

guidance throughout 2015. In February 2015, the 

FDIC adopted another aspect of Basel III regarding 

certain regulatory reporting under the final capital 

rule. In June 2015, the FDIC adopted as final its 

amendments to the advanced approaches risk-based 

capital rule. The rule addresses certain technical 

adjustments to the advanced approaches risk-based 

capital rule to enhance consistency of the U.S. capital 

rules with international standards for the use of 

the advanced approaches framework. The agencies 

also provided capital guidance to banks by issuing 

a calculation tool that helps certain institutions 

determine risk-weighted assets and by releasing 

frequently asked questions (FAQs) on the revised 

rules. Finally, the agencies issued joint supervisory 

guidance in November 2015 concerning the capital 

treatment for certain covered funds under the final 

rule implementing Section 13 of the Bank Holding 

Company Act (Volcker Rule).

Regulatory Reporting Under the Final Capital Rule 

In February 2015, the FDIC, the Federal Reserve 

Board (FRB), and the Office of the Comptroller 

of the Currency (OCC), under the auspices of the 

Federal Financial Institutions Examination Council 

(FFIEC), announced changes to regulatory capital 

reporting on the Consolidated Reports of Condition 

and Income (Call Report). The changes update 

the risk-weighted assets portion of the regulatory 

capital schedule to reflect the standardized approach 

to risk weighting in the revised capital rules. These 

regulatory capital reporting changes were effective as 

of the March 31, 2015 report date for all institutions. 

As of the same report date, the revisions to the 

regulatory capital components and ratios portion 

of the Call Report regulatory capital schedule that 

were effective as of March 31, 2014, for advanced 

THE YEAR IN REVIEW

Photo credit: Courtesy ABA Banking Journal 

An Interview with the FDIC’s Chairman Martin J. Gruenberg

American Bankers Association President and CEO Frank Keating 

asks for the FDIC Chairman’s views on the future of community 

banking, cybersecurity threats, regulatory burden, too-big-to-fail, 

and more.
16 FEDERAL DEPOSIT INSURANCE CORPORATION

approaches institutions became applicable to all 

other institutions. 

In February and December 2015, the FDIC and the 

other banking agencies, under the auspices of the 

FFIEC, held national teleconferences for depository 

institutions to help them better understand the 

revisions to the regulatory capital schedule. More 

than 2,600 people participated in the February call, 

and 1,200 took part in the December event. 

In March 2015, the FDIC and the other federal 

banking agencies also implemented the new FFIEC 

102 market risk regulatory report. This quarterly 

report collects key information from the limited 

number of institutions subject to the Basel III market 

risk capital rules on how they measure and calculate 

market risk under these rules. The report was 

approved by the Office of Management and Budget 

(OMB) and took effect as of the March 31, 2015, 

report date. 

Regulatory Capital — Revisions Applicable to 

Banking Organizations Subject to the Advanced 

Approaches Risk-Based Capital Rule 

In June 2015, the FDIC Board approved a joint final 

rule that made technical corrections to the advanced 

approaches risk-based capital rules and rectified 

certain missing internal ratings-based requirements 

that were identified as part of the Regulatory 

Consistency Assessment Program. The final rule was 

published in the Federal Register on July 15, 2015.

Regulatory Capital Guidance

The FDIC led the development of a calculation 

tool to help institutions that have securitization 

exposures calculate their risk-weighted assets under 

the Simplified Supervisory Formula Approach. The 

FDIC released the calculator in February 2015, 

through a Financial Institution Letter (FIL), and the 

tool is available on the FDIC’s website as well as the 

websites of the other federal banking agencies.

In addition, in April 2015, the federal banking 

agencies released an initial set of FAQs on the 

revised capital rules, many of which are focused on 

community bank issues. The capital FAQs are posted 

on the FDIC website and are expanded as additional 

questions are raised. 

Capital Deduction Guidance for Non-Legacy 

Covered Funds Under the Volcker Rule 

In November 2015, the FDIC, jointly with the 

FRB and OCC, issued guidance that clarifies the 

interaction between the regulatory capital rule and the 

Volcker Rule with respect to the appropriate capital 

treatment for investments in certain private equity 

funds and hedge funds (covered funds). The FDIC 

issued FIL 50-2015 titled Supervisory Guidance on the 

Capital Treatment of Certain Investments in Covered 

Transactions to notify FDIC-supervised institutions of 

the calculations. The Volcker Rule prohibits banking 

organizations from holding ownership interests in 

covered funds after the relevant conformance period, 

unless such ownership interests are covered under 

certain exceptions/exemptions in the final rule. 

An exception is permitted for ownership interests 

arising from sponsoring covered funds totaling 

less than 3 percent of Tier 1 capital and subject to 

certain seeding period provisions. Under the rule, 

investments in covered funds purchased or acquired 

after December 31, 2013, must be deducted from 

Tier 1 capital after an initial conformance period that 

ended on July 21, 2015. The conformance period 

for legacy covered funds will end in July 2017. The 

guidance and instructions regarding legacy covered 

funds will be available at a later time. The November 

supervisory guidance describes the mechanics for 

making capital deductions under the Volcker Rule 

and how these relate to deductions required under the 

regulatory capital rule for investments in the capital 

instruments of unconsolidated financial institutions. 

These mechanics are intended to ensure no “double 

deductions” from Tier 1 capital.

Other Rulemaking and Guidance 

Under the Dodd-Frank Act 

The Dodd-Frank Act requires various agencies 

to publish regulations in a number of areas. The 

following is a summary of significant rulemaking 
MANAGEMENT'S DISCUSSION AND ANALYSIS 17

activity relating to the Dodd-Frank Act and other 

accomplishments during the year.

Minimum Requirements for Appraisal 

Management Companies 

In April 2015, the FDIC, jointly with the OCC, 

FRB, National Credit Union Administration 

(NCUA), Consumer Financial Protection Bureau 

(CFPB), and the Federal Housing Finance 

Agency (FHFA), issued a final rule to implement 

the minimum requirements for registration and 

supervision of appraisal management companies 

(AMCs) under the Dodd-Frank Act. The final rule 

establishes the minimum requirements set forth in 

Section 1473 of the Act (Section 1473) for state 

registration and supervision of AMCs; outlines the 

minimum requirements for AMCs that register with a 

state under Section 1473; requires federally regulated 

AMCs to meet the minimum requirements of Section 

1473 (other than registering with a state); and requires 

the reporting of certain AMC information to the 

Appraisal Subcommittee of the FFIEC. The final rule 

was published in the Federal Register on June 9, 2015, 

and the effective date was August 10, 2015.

The Volcker Rule 

The Volcker Rule (Rule) contains restrictions and 

prohibitions on the ability of banks and their 

affiliates to engage in proprietary trading and have 

interests in, or relationships with, a hedge fund or 

a private equity fund. The Rule was adopted on 

December 10, 2013, and became effective on April 1, 

2014. The Volcker Rule was subject to an extended 

conformance period that expired on July 21, 2015. 

In April and December of 2014, the FRB issued 

Orders announcing that it planned to extend the 

conformance period for certain covered funds for two 

additional one-year periods, so that the conformance 

period for these “legacy” covered funds would end 

July 21, 2017. 

In January 2014, the Volcker Rule agencies 

[FDIC, OCC, FRB, Commodity Futures Trading 

Commission (CFTC), and Securities and Exchange 

Commission (SEC)] adopted a joint interim final 

rule that permits banking entities subject to the 

Rule to retain investments in certain collateralized 

debt obligations backed primarily by trust preferred 

securities.

To help ensure consistent implementation of the 

Volcker Rule, the agencies established an interagency 

working group that meets regularly to discuss issues 

and the application and enforcement of the Rule. 

During 2015, the interagency Volcker Rule working 

group posted 11 joint FAQs on their websites to 

address certain implementation issues presented by 

banking entities subject to the Rule. The questions 

addressed such matters as:

• Chief Executive Officer Certification for Prime 

Brokerage Transactions

• Compliance for Market Making and the 

Identification of Covered Funds

• Termination of Market-Making Activity: Treatment 

of Residual Positions

• Conformance Period

• Seeding Period Treatment of Registered Investment 

Companies and Foreign Public Funds

• Foreign Public Funds Sponsored by a Banking 

Entity

• Joint Venture Exclusion for Covered Funds

• Solely Outside the United States Covered Fund 

Exemption: Marketing Restriction

• Applicability of the Restrictions in Section 13(f) of 

the Bank Holding Company Act (Super 23A)

• 30-Day Metrics Reporting During the 

Conformance Period

• Treasury Separate Trading of Registered Interest and 

Principal Securities (STRIPS) 

Margin and Capital Requirements 

for Covered Swaps Entities

In October 2015, the FDIC approved a final rule to 

establish margin requirements for swaps that are not 

cleared through a clearinghouse. The final rule takes 

into account the risk posed by a swaps dealer’s 
18 FEDERAL DEPOSIT INSURANCE CORPORATION

counterparties in establishing the minimum amount 

of initial and variation margin that the covered swaps 

entity must exchange with such counterparties. 

The final rule was issued jointly with the OCC, the 

FRB, the Farm Credit Administration (FCA), and the 

FHFA. The rule will apply to entities supervised by 

these agencies that register with the CFTC or SEC as 

a dealer or major participant in swaps. The joint final 

rule was developed in consultation with the CFTC 

and the SEC, as required by the Dodd-Frank Act.

The final rule implements certain requirements 

contained in Sections 731 and 764 of the DoddFrank Act, which requires the prudential regulators 

to establish initial and variation margin requirements 

for the largest and most active participants in the 

over-the-counter (OTC) derivatives market. The 

Dodd-Frank Act required the agencies to impose 

margin requirements to help ensure the safety and 

soundness of swaps dealers in light of the risk to 

the financial system associated with non-cleared 

swaps activity. The rule is also consistent with the 

international framework on margin requirements 

published in September 2013 by the Basel Committee 

on Banking Supervision (BCBS) and the International 

Organization of Securities Commissions. 

The final rule requires insured depository institutions 

(IDIs) that are covered swaps entities— the large 

dealers subject to the rule—to collect and post initial 

margin on non-cleared swaps entered into with 

other dealers, and with financial end users that have 

at least $8 billion, notional, in non-cleared swaps. 

The final rule also requires covered swaps entities 

to post and collect daily variation margin for swaps 

with other swaps entities or with financial enduser counterparties, regardless of the level of swaps 

exposure if the required amount of variation margin 

and initial margin exceeds $500,000. For noncleared swaps with financial affiliates, an IDI swaps 

dealer would be required to post and collect daily 

variation margin, but only collect initial margin 

from the affiliate. The final margin rule will be 

phased in beginning September 2016 and applies 

only to new swaps entered into after the applicable 

compliance dates.

Also in October 2015, the agencies approved an 

interim final rule, as required by Title III of the 

Terrorism Risk Insurance Program Reauthorization 

Act of 2015, so that the margin requirements do 

not apply to non-cleared swaps that a covered swaps 

entity enters into with a commercial end user, a small 

financial institution with total assets of $10 billion 

or less, or certain cooperatives if the counterparty 

uses the swaps for hedging purposes. This exemption 

parallels an exemption from a mandate in the DoddFrank Act to clear standardized swaps. The interim 

final rule is effective April 1, 2016. 

Capital requirements under Sections 731 and 764 

have been previously incorporated in the agencies’ 

capital rules, with the exception of the FCA. 

Liquidity and Funds Management 

Rulemaking

Net Stable Funding Ratio 

The net stable funding ratio (NSFR) is designed 

to complement the liquidity coverage ratio (LCR), 

which took effect January 1, 2015. While the LCR 

focuses on having sufficient liquid asset holdings to 

weather a short-term severe stress, the goal of the 

NSFR is to stabilize funding over a longer horizon. 

Specifically, the NSFR would require the largest banks 

to maintain a stable funding profile in relation to 

their on- and off-balance sheet activities, comparing 

an entity’s available stable funding sources over a 

one-year horizon against asset and off-balance sheet 

obligations. In October 2014, the BCBS published a 

final standard to implement the NSFR. Throughout 

2015, the FDIC, the OCC, and the FRB devoted 

substantial resources to develop an interagency notice 

of proposed rulemaking (NPR) to implement the 

NSFR rule, with a target of issuing the NPR by 

year-end 2015. However, the agencies decided in 

late 2015 to delay issuance of the NPR until 2016 to 

allow additional analysis.
MANAGEMENT'S DISCUSSION AND ANALYSIS 19

Financial Sector Assessment Program

The FDIC participated in the International Monetary 

Fund’s (IMF) Financial Sector Assessment Program 

(FSAP). The goal of FSAP assessments is twofold: 

(1) to gauge the stability of the financial sector and 

(2) to assess its potential contribution to growth and 

development. To assess the stability of the financial 

sector, FSAP teams examine the soundness and 

resilience of the banking and other financial sectors; 

conduct stress tests and analyze linkages among 

financial institutions, including across borders; rate 

the quality of bank, insurance, and financial market 

supervision against accepted international standards; 

and evaluate the ability of supervisors. In addition, 

FSAPs examine the quality of the legal framework 

and of financial infrastructure, such as the payments 

and settlements system; identify obstacles to the 

competitiveness and efficiency of the sector; and 

examine its contribution to economic growth and 

development. FDIC staff provided expertise and 

comprehensive feedback to the IMF to support the 

FSAP as it related to the FDIC’s Banking, Insurance, 

and Resolution business lines. The FDIC worked 

collaboratively with other U.S. financial institution 

regulatory authorities throughout this review to 

provide data. The results of the FSAP review were 

detailed in a report published on July 7, 2015. The 

report states that the banking agencies have improved 

effectiveness since the 2010 FSAP assessment and 

have achieved a high degree of compliance with 

international banking standards, although some 

recommendations for improvement were noted. The 

FDIC worked with other federal banking regulators 

to provide a consolidated response to IMF findings.

DEPOSIT INSURANCE

As insurer of bank and savings association deposits, 

the FDIC must continually evaluate and effectively 

manage how changes in the economy, the financial 

markets, and the banking system affect the adequacy 

and the viability of the Deposit Insurance Fund 

(DIF).

Long-Term Comprehensive Fund 

Management Plan 

In 2010 and 2011, the FDIC developed a 

comprehensive, long-term DIF management plan 

designed 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. That plan complements the Restoration 

Plan, originally adopted in 2008 and subsequently 

revised, which is designed to ensure that the reserve 

ratio (the ratio of the fund balance to estimated 

insured deposits) reaches 1.35 percent by September 

30, 2020, as required by the Dodd-Frank Act. (As 

discussed in the Minimum Reserve Ratio section below, 

the Act also requires that the FDIC offset the effect 

on institutions with less than $10 billion in assets 

of increasing the reserve ratio from 1.15 percent to 

1.35 percent.) These plans include a reduction in 

assessment rates that the FDIC Board of Directors 

(FDIC Board) adopted to become effective once the 

reserve ratio reaches 1.15 percent. 

Under the long-term DIF management plan, to 

increase the probability that the fund reserve ratio will 

reach a level sufficient to withstand a future crisis, the 

FDIC Board has set the Designated Reserve Ratio 

(DRR) of the DIF at 2.0 percent. The FDIC views 

the 2.0 percent DRR as a long-term goal and the 

minimum level needed to withstand future crises of 

the magnitude of past crises. Under provisions of the 

Federal Deposit Insurance Act (FDI Act) that require 

the FDIC Board to set the DRR for the DIF annually, 

the FDIC Board voted in October 2015 to maintain 

the 2.0 percent DRR for 2016—the ratio that has 

been in effect every year since 2011.

Also as part of the long-term DIF management plan, 

the FDIC has suspended dividends indefinitely when 

the fund reserve ratio exceeds 1.5 percent. Instead, 

the plan prescribes progressively lower assessment 

rates that will become effective when the reserve ratio 

exceeds 2.0 percent and 2.5 percent. These lower 

assessment rates serve much the same function as 

dividends, but provide more stable and predictable 

effective assessment rates over time.
20 FEDERAL DEPOSIT INSURANCE CORPORATION

State of the Deposit Insurance Fund 

Estimated losses to the DIF from bank failures that 

occurred in 2015 totaled $829 million.  The fund 

balance continued to grow through 2015, as it has 

every quarter after the end of 2009, for a total of 24 

consecutive quarters. Lower than estimated losses 

for bank failures together with assessment revenue 

contributed to the increase in the fund balance in 

2015. The fund reserve ratio rose to 1.09 percent at 

September 30, 2015, from 0.88 percent a year earlier. 

Minimum Reserve Ratio

In October 2015, the FDIC approved an NPR that 

would implement section 334 of the Dodd-Frank Act, 

which increases the minimum reserve ratio from 1.15 

percent to 1.35 percent, requires that the reserve ratio 

reach that level by September 30, 2020, and mandates 

that the FDIC “offset the effect of (the increase in 

the minimum reserve ratio from 1.15 percent to 1.35 

percent) on IDIs with total consolidated assets of less 

than $10 billion.” 

To implement these requirements, the proposed rule 

would impose surcharges on the quarterly assessments 

of IDIs with total consolidated assets of $10 billion 

or more. The surcharges would begin the calendar 

quarter after the reserve ratio of the DIF first reaches 

or exceeds 1.15 percent—the same time that lower 

regular quarterly deposit insurance assessment 

(regular assessment) rates take effect under current 

regulations—or the quarter in which a final rule takes 

effect, whichever occurs later, and would continue 

through the quarter that the reserve ratio first reaches 

or exceeds 1.35 percent. In general, the surcharge 

would equal an annual rate of 4.5 basis points applied 

to the institution’s regular quarterly deposit insurance 

assessment base, after making certain adjustments 

specifically for the surcharge. The FDIC expects that 

eight quarterly surcharges would be needed for the 

reserve ratio to reach 1.35 percent.

If, contrary to the FDIC’s expectations, the reserve 

ratio does not reach 1.35 percent by December 31, 

2018 (but has reached at least 1.15 percent), the NPR 

would impose a shortfall assessment on IDIs with 

total consolidated assets of $10 billion or more on 

March 31, 2019.

Because the Dodd-Frank Act requires that the FDIC 

offset the effect of the increase in the reserve ratio 

from 1.15 percent to 1.35 percent on IDIs with total 

consolidated assets of less than $10 billion, the NPR 

would provide assessment credits to these institutions 

for the portion of their regular assessments that 

contribute to growth in the reserve ratio between 

1.15 percent and 1.35 percent. 

Deposit Insurance Assessment System

In June 2015, the FDIC approved an NPR to 

refine the deposit insurance assessment system for 

established small banks (generally, those with less than 

$10 billion in total assets that have been federally 

insured for at least five years). In January 2016, the 

FDIC approved a second NPR that would revise 

parts of the proposal adopted by the FDIC in June 

2015. The primary purpose of these NPRs is to 

improve the risk-based deposit insurance assessment 

system applicable to established small banks to more 

accurately reflect risk. The NPRs would incorporate 

newer data from the recent financial crisis and base 

assessment rates for all established small banks on a 

statistical model that estimates a bank’s probability 

of failure within three years. The NPRs propose that 

the revisions would go into effect the quarter after the 

reserve ratio of the DIF reaches 1.15 percent (or the 

first quarter after a final rule is adopted and the rule 

can take effect, whichever is later). The NPRs would 

maintain the range of assessment rates that will apply 

once the DIF reserve ratio reaches 1.15 percent, 2 

percent, and 2.5 percent, and would be implemented 

in a manner such that aggregate assessment revenue 

collected from established small banks under the 

NPRs would be approximately the same as would 

be collected under the current small bank pricing 

method for calculating assessments after the reserve 

ratio reaches 1.15 percent.
MANAGEMENT'S DISCUSSION AND ANALYSIS 21

ACTIVITIES RELATED TO 

SYSTEMICALLY IMPORTANT 

FINANCIAL INSTITUTIONS

Complex Financial Institutions Program

The FDIC is committed to addressing the unique 

challenges associated with the supervision, insurance, 

and potential resolution of large and complex financial 

institutions. The FDIC’s ability to analyze and 

respond to risks in these institutions is particularly 

important, as they comprise a significant share of 

banking industry assets and deposits. The FDIC’s 

programs related to complex financial institutions 

provide for a consistent approach to large bank 

supervision nationwide, allow for the identification 

and analysis of industry-wide and institution-specific 

risks and emerging issues, and enable a quick response 

to these risks. Given the concentration of risk in these 

institutions, the FDIC has expanded its activities at 

the nation’s largest and most complex institutions 

through additional and enhanced on-site and offsite monitoring and supervision as well as close 

coordination with other federal agencies.

The Dodd-Frank Act expanded the FDIC’s 

responsibilities pertaining to systemically important 

financial institutions (SIFIs) and non-bank financial 

companies designated by the Financial Stability 

Oversight Council (FSOC). With regard to the 

largest, most complex SIFIs, the FDIC’s Complex 

Financial Institutions (CFI) program activities include 

ongoing risk monitoring, backup supervision of their 

related IDIs, and evaluation of required resolution 

plans. CFI program activities related to FSOCdesignated non-bank companies also include ongoing 

risk monitoring and evaluation of required resolution 

plans. In addition, the CFI program performs other 

analyses that support the FDIC’s role as an FSOC 

member. 

Risk Monitoring Activities for Systemically 

Important Financial Institutions

The FDIC monitors risks related to SIFIs at both 

the individual company level and industry wide to 

inform supervisory attention and response, policy 

and guidance considerations, and resolution planning 

efforts. To do this, the FDIC analyzes each company’s 

risk profile, governance and risk management 

capabilities, structure and interdependencies, business 

operation and activities, management information 

system capabilities, and recovery and resolution 

capabilities. 

The FDIC continues to work closely with other 

federal regulators to analyze institution-specific and 

industry-wide conditions and trends, emerging risks 

and outliers, risk management and the potential 

risk posed to financial stability by SIFIs and nonbank financial companies. In 2015, FDIC staff 

participated in 70 examinations with the FRB and 

OCC, including, but not limited to, engagement 

in Comprehensive Capital Analysis and Reviews 

(CCAR)/Dodd-Frank Act Stress Testing (DFAST), 

Comprehensive Liquidity Analysis and Reviews 

(CLAR), and the Shared National Credit (SNC) 

Reviews. Additionally, the FDIC added resources 

with quantitative modeling expertise, which 

supported many of the aforementioned efforts and 

additional activities that included Basel qualification 

reviews, quantitative model reviews, model validation 

reviews, and internal training. Also, in 2015, 

the FDIC participated in the FRB’s Supervisory 

Assessment of Recovery and Resolution Preparedness 

program in an effort to assess firms’ management 

information system capabilities related to recovery 

and resolution. Lastly, the FDIC collaborated 

with the FRB on Dodd-Frank Act Title I resolution 

plan assessments. 

To support risk monitoring that informs supervisory 

and resolution planning efforts, the FDIC developed 

systems and reports that make extensive use of 
22 FEDERAL DEPOSIT INSURANCE CORPORATION

structured and unstructured data. SIFI monitoring 

reports are prepared on a routine and ad-hoc basis and 

cover a variety of aspects that include risk component, 

business line and activity, market trends, and product 

analysis. Additionally, the FDIC has implemented 

and continues to expand upon various systems, 

including the Systemic Monitoring System (SMS). 

The SMS provides an individual risk profile and 

assessment for each SIFI by evaluating the level and 

change in metrics that serve as important barometers 

of overall risk. The SMS supports the identification 

of emerging risks within individual firms and the 

prioritization of supervisory and monitoring activities. 

The SMS also serves as an early warning system of 

financial vulnerability by gauging a firm’s proximity 

and speed to resolution event. Information from 

FDIC-prepared reports and systems are used to 

prioritize activities relating to SIFIs and coordinate 

and communicate with the FRB and OCC. 

The FDIC also conducted semi-annual “Day of Risk” 

meetings to present, discuss, and prioritize the review 

of emerging risks. For each major risk, executive 

management discussed the nature of the risk, 

exposures of SIFIs, and planned supervisory efforts.

Backup Supervision Activities for IDIs of 

Systemically Important Financial Institutions

Risk monitoring is enhanced by the FDIC’s backup 

supervision activities. In the FDIC’s backup 

supervisory role, as outlined in Sections 8 and 10 of 

the FDI Act, the FDIC has expanded resources and 

developed and implemented policies and procedures 

to guide backup supervisory activities. These activities 

include performing analyses of industry conditions 

and trends, insurance pricing support, participating 

in supervisory activities with other regulatory 

agencies, and exercising examination and enforcement 

authorities when necessary. At institutions where 

the FDIC is not the primary federal regulator (PFR), 

staff works closely with other financial institution 

regulatory authorities to identify emerging risk and 

assess the overall risk profile of large and complex 

institutions. The FDIC, the FRB, and the OCC 

operate under a Memorandum of Understanding 

(MOU) that establishes guidelines for coordination 

and cooperation to carry out their respective 

responsibilities, including the FDIC’s role as insurer 

and supervisor. Under this agreement, the FDIC has 

assigned dedicated staff to systemically important 

and large, complex regional banking organizations to 

enhance risk identification capabilities and facilitate 

the communication of supervisory information. 

These individuals work closely with PFR staff in 

the ongoing monitoring of risk at their assigned 

institutions.

Title I Resolution Plans

The Dodd-Frank Act requires that certain large 

banking organizations and nonbank financial 

companies designated by the FSOC for supervision 

by the FRB periodically submit resolution plans to 

the FRB and the FDIC. Each Title I resolution plan, 

commonly known as a living will, must describe the 

company’s strategy for rapid and orderly resolution 

in the event of material financial distress or failure 

of the company. Twelve large and complex banking 

organizations must file resolution plans in July and 

the remaining firms file plans in December. 

July Filers 

The 12 firms filing in July are Bank of America 

Corporation, Bank of New York Mellon Corporation, 

Barclays PLC, Citigroup Inc., Credit Suisse Group 

AG, Deutsche Bank AG, Goldman Sachs Group, Inc., 

JPMorgan Chase & Co., Morgan Stanley, State Street 

Corporation, UBS AG, and Wells Fargo & Company. 

As a follow-up to the specific feedback the FRB 

and the FDIC provided to these firms in August 

2014, the agencies initiated measures to improve 

communication with the firms regarding expectations 

for the July 1, 2015, resolution plan submissions. 

In fourth quarter 2014, the agencies provided the 

12 firms with the opportunity to submit a preview 

of the key aspects of their planned July 2015 Title I 

resolution plan submissions. 

Almost all firms submitted preview documents to 

the agencies by year-end 2014, and the agencies 
MANAGEMENT'S DISCUSSION AND ANALYSIS 23

provided written feedback on the documents to the 

firms in February. In addition, the agencies held a 

joint meeting with the firms on February 25, 2015, 

to answer questions and communicate industrywide issues regarding resolution plans. The agencies’ 

staff also met with the firms individually, on several 

occasions, during the first and second quarters of 

2015 to discuss their upcoming submissions. The 

FDIC and the FRB are now reviewing the 2015 plan 

submissions from the 12 firms.

December Filers 

By December 31, 2014, the December filers had 

submitted their second resolution plans. In July 

2015, after reviewing those plans, the FDIC and 

the FRB provided the 119 firms with guidance, 

clarification, and direction for their 2015 submissions 

based on the relative size and scope of each firm’s 

U.S. operations. Plan requirements were tiered, with 

less complex firms filing more streamlined plans as 

follows:

• Twenty-nine of the more complex firms were 

required to file either full or tailored resolution 

plans that take into account guidance identified by 

the agencies.

• Ninety firms with limited U.S. operations were 

allowed to file plans that focus on material changes 

to their 2014 resolution plans; actions taken to 

strengthen the effectiveness of those plans; and, 

where applicable, actions to ensure any subsidiary 

insured depository institution is adequately 

protected from the risk arising from the activities of 

nonbank affiliates of the firm. 

In July 2015, the agencies also released an updated 

tailored resolution plan template for the December 

filers’ plans. The optional template, which is intended 

to facilitate the preparation of tailored resolution 

plans, focuses on the nonbanking operations of 

the company and on the interconnections and 

interdependencies between its nonbanking and 

banking operations. 

By December 31, 2015, 122 December filers had 

submitted plans to the agencies. The FDIC and the 

FRB are reviewing those plans.

Nonbank Firms

On July 28, 2015, the FRB and the FDIC provided 

feedback by joint letter to American International 

Group, Inc. (AIG), General Electric Capital 

Corporation, Inc. (GECC), and Prudential, Inc., 

regarding their initial resolution plans and guidance 

for their year-end 2015 filings. The agencies tailored 

their feedback to account for each company’s unique 

business, structure, and operations. In addition to the 

specific guidance given to each company, the letters 

included some common themes that the firms should 

address. Those areas included the need for more 

detailed information on, and analysis of, obstacles 

to resolvability, including global cooperation, 

interconnectedness, and adequate funding and 

liquidity. Further, the agencies instructed the firms 

to describe in their resolution plans the progress they 

are making, and the steps remaining, to be more 

resolvable. Finally, the agencies directed the firms 

to strengthen the public portions of the firms’ 2015 

resolution plans. 

The three nonbank firms submitted the second 

version of their annual resolution plans in December 

2015. The FRB and the FDIC are currently 

reviewing those plans.

On March 26, 2015, the agencies permanently 

adjusted the annual resolution plan filing deadline 

for nonbank financial companies—AIG, GECC, 

MetLife, Inc., and Prudential, Inc.—from July 1 

to December 31, beginning in 2016. The agencies 

had temporarily extended the 2015 resolution plan 

deadlines for the nonbank firms to December 31st. 

In addition, MetLife was designated as systemically 

important on December 18, 2014, and will submit its 

first resolution plan by December 31, 2016.

Insured Depository Institution 

Resolution Plans

Section 360.10 of the FDIC Rules and Regulations 

requires all IDIs with assets greater than $50 billion 

to submit resolution plans to the FDIC (IDI Rule). 

The IDI Rule requires each IDI meeting the criteria to 

provide a resolution plan that should allow the FDIC 
24 FEDERAL DEPOSIT INSURANCE CORPORATION

as receiver to resolve the IDI in an orderly manner 

that enables prompt access of insured deposits, 

maximizes the return from the failed IDI’s assets, and 

minimizes losses realized by creditors and the DIF. 

Based upon a review of IDI plans submitted before 

and during 2014, the FDIC issued guidance in 

December 2014 for resolution plans required by the 

IDI Rule. Under the guidance, a covered IDI must 

provide a fully developed discussion and analysis of a 

range of realistic resolution strategies. To assist IDIs 

in writing their plans, the guidance includes direction 

regarding the elements that should be discussed in 

a fully developed resolution strategy and the cost 

analysis, clarification regarding assumptions made 

in the plan, and a list of significant obstacles to an 

orderly and least costly resolution that IDIs should 

address. The guidance applies to the resolution 

plans of 36 IDIs covered by the IDI Rule, as well as 

any new IDI meeting the threshold, commencing 

with the 2015 resolution plan submissions. The 

FDIC is reviewing the 10 IDI resolution plans that 

were submitted by September 1, 2015, and the 26 

remaining IDI resolution plans that were submitted 

by December 31, 2015. The FDIC is conducting a 

review focused on the insolvency scenario, strategy 

and funding, readiness, and corporate governance.

Title II Resolution Strategy Development

Under the Dodd-Frank Act, failed or failing financial 

companies are expected to file for reorganization or 

liquidation under the U.S. Bankruptcy Code, just as 

any failed or failing nonfinancial company would file. 

If resolution under the Bankruptcy Code would result 

in serious adverse effects to U.S. financial stability, the 

Orderly Liquidation Authority (OLA) set out in Title 

II of the Dodd-Frank Act provides a backup authority 

to the bankruptcy process. There are strict parameters 

on its use, 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 been developing strategies, including 

an approach referred to as “Single Point of Entry,” to 

carry out its orderly liquidation authorities. Firmspecific resolution strategies for each SIFI continue to 

be developed and refined. In addition, preliminary 

work has begun with respect to developing resolution 

strategies for the nonbank firms and systemically 

important financial market utilities, particularly 

central counterparties (CCP).

To evaluate the requirements for carrying out a 

Title II resolution, and to identify areas of further 

development, the FDIC conducted an operational 

exercise in 2015. This exercise included senior FDIC 

managers and staff representing areas within the 

organization that would be responsible for executing 

a resolution under Title II of the Dodd-Frank Act. 

Participants discussed the primary actions that would 

occur during the initial appointment of the FDIC 

as receiver of a SIFI and the stabilization phase 

immediately following appointment. The exercise 

validated the current Title II planning efforts and 

enhanced organizational cooperation and awareness, 

in addition to identifying areas for further work. 

Cross-Border Efforts

Advance planning and cross-border coordination 

for the resolution of global-SIFIs (G-SIFIs) will be 

essential to minimizing disruptions to global financial 

markets. Recognizing that G-SIFIs create complex 

international legal and operational concerns, the 

FDIC continues to work with foreign regulators 

to establish frameworks for effective cross-border 

cooperation. 

During 2015, the FDIC continued to coordinate with 

representatives from European authorities to discuss 

issues of mutual interest, including the resolution of 

European G-SIFIs and harmonization of receivership 

actions. The FDIC and the European Commission 

(EC) continued their engagement through the 

joint Working Group, which is composed of 

FDIC and EC senior executives who meet to 

focus on both resolution and deposit insurance issues. 
MANAGEMENT'S DISCUSSION AND ANALYSIS 25

The Working Group meets twice a year with other 

interim interchanges, including the exchanging of staff 

members. Discussions were held in 2015 concerning 

cross-border bank resolution and CCP resolution, 

among other topics. The FDIC also continued its 

deep cooperation with the Single Resolution Board 

on technical aspects of resolution, including through 

staff level exchanges.

The FDIC continued its relationships with other 

jurisdictions that regulate G-SIFIs, including the 

United Kingdom (U.K.), Switzerland, Germany, 

France, and Japan. In 2015, the FDIC had significant 

principal and staff-level engagements with these 

countries to discuss cross-border issues and potential 

impediments that would affect the resolution of a 

G-SIFI. This included hosting a delegation from 

Japan in February to discuss cross-border issues related 

to resolution in both respective jurisdictions. Similar 

staff-level engagements took place with the U.K. 

and Switzerland, such as the U.K.-U.S. Financial 

Market Infrastructure working group, which meets 

to discuss resolvability considerations and develop 

common approaches concerning financial market 

infrastructures in the United Kingdom and the 

United States. This work will continue in 2016 with 

plans to host tabletop exercises with regulatory staff 

from certain of these jurisdictions.

Systemic Resolution Advisory Committee

In 2011, the FDIC Board approved the creation 

of the Systemic Resolution Advisory Committee 

(SRAC). The SRAC provides important advice to the 

FDIC regarding systemic resolutions and advises the 

FDIC on a variety of issues, including the following:

• The effects on financial stability and economic 

conditions resulting from the failure of a SIFI.

• The ways in which specific resolution strategies 

would affect stakeholders and their customers. 

• The tools available to the FDIC to wind down the 

operations of a failed organization.

• The tools needed to assist in cross-border relations 

with foreign regulators and governments when a 

systemic company has international operations. 

Members of the SRAC have a wide range of 

experience, including managing complex firms; 

administering bankruptcies; and working in the legal 

system, accounting field, and academia. The last 

meeting of the SRAC was held in December 2014. 

The SRAC discussed, among other topics, resolution 

plans and bankruptcy, resolution plan transparency, 

international developments, International Swaps 

and Derivatives Association protocol, and orderly 

liquidation updates. In 2015, the charter of the 

SRAC was renewed. The next meeting is scheduled to 

be held in 2016.

Financial Stability Oversight Council 

The FSOC was created by the Dodd-Frank Act in 

July 2010 to promote the financial stability of the 

United States. It is composed of ten voting members, 

including the Chairperson of the FDIC, and five nonvoting members. 

The FSOC’s responsibilities include the following:

• Identifying risks to financial stability, responding 

to emerging threats in the financial system, and 

promoting market discipline.

• Identifying and assessing threats that institutions 

may pose to financial stability and, if appropriate, 

designating a nonbank financial company for 

supervision by the FRB subject to heightened 

prudential standards.

• Designating financial market utilities and payment, 

clearing, or settlement activities that are, or are 

likely to become, systemically important.

SRAC members (from left) Paul Volcker, Simon Johnson, and 

Anat Admati confer with Chairman Gruenberg during a break 

between panel discussions at the December 2014 meeting.
26 FEDERAL DEPOSIT INSURANCE CORPORATION

• Facilitating regulatory coordination and 

information-sharing regarding policy development, 

rulemaking, supervisory information, and reporting 

requirements.

• Monitoring domestic and international financial 

regulatory proposals and advising Congress and 

making recommendations to enhance the integrity, 

efficiency, competitiveness, and stability of U.S. 

financial markets. 

• Producing annual reports describing, among 

other things, the Council’s activities and potential 

emerging threats to financial stability.

In 2015, the FSOC issued its fifth annual report. 

Generally, at each of its meetings, the FSOC discusses 

various risk issues. In 2015, the FSOC meetings 

addressed, among other topics, U.S. fiscal issues, 

interest rate risk, credit risk, cybersecurity, and 

nonbank financial company designations.

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 IDIs, 

protects consumers’ rights, and promotes community 

investment initiatives. 

Examination Program 

The FDIC’s strong bank examination program is the 

core of its supervisory program. As of December 31, 

2015, the FDIC was the primary federal regulator 

(PFR) for 4,008 FDIC-insured, state-chartered 

institutions that were not members of the Federal 

Reserve System [generally referred to as “state 

nonmember” (SNM) institutions]. Through risk 

management (safety and soundness), consumer 

compliance and the Community Reinvestment 

Act (CRA), and other specialty examinations, the 

FDIC assesses an institution’s operating condition, 

management practices and policies, and compliance 

with applicable laws and regulations. 

As of December 31, 2015, the FDIC conducted 

1,871 statutorily required risk management 

examinations, including a review of Bank Secrecy 

Act (BSA) compliance, and all required followup examinations for FDIC-supervised problem 

institutions, within prescribed time frames. The 

FDIC also conducted 1,347 statutorily required CRA/

compliance examinations (859 joint CRA/compliance 

examinations, 478 compliance-only examinations, and 

10 CRA-only examinations). In addition, the FDIC 

performed 4,157 specialty examinations. 

The table on page 27 compares the number of 

examinations, by type, conducted from 2013 

through 2015.

Risk Management

All risk management examinations have been 

conducted in accordance with statutorily established 

timeframes. As of September 30, 2015, 203 insured 

institutions with total assets of $51.1 billion were 

designated as problem institutions for safety and 

soundness purposes (defined as those institutions 

having a composite CAMELS1

 rating of 4 or 5), 

compared to the 329 problem institutions with total 

assets of $102.3 billion on September 30, 2014. This 

is a 38 percent decline in the number of problem 

institutions and a 50 percent decrease in problem 

institution assets. For the twelve months ending 

September 30, 2015, 142 institutions with aggregate 

assets of $51.8 billion were removed from the list of 

problem financial institutions, while 16 institutions 

with aggregate assets of $3.0 billion were added to the 

list. The FDIC is the PFR for 133 of the 203 problem 

institutions, with total assets of $24.5 billion. 

In 2015, the FDIC’s Division of Risk Management 

Supervision initiated 233 formal enforcement actions 

and 165 informal enforcement actions. Enforcement 

actions against institutions included, but were not 

limited to, 28 actions under Section 8(b) of the FDI 

1

 The CAMELS composite rating represents the adequacy of Capital, the quality of Assets, the capability of Management, the quality 

and level of Earnings, the adequacy of Liquidity, and the Sensitivity to market risk, and ranges from “1” (strongest) to “5” (weakest).
MANAGEMENT'S DISCUSSION AND ANALYSIS 27

Act (27 consent orders and 1 notice of charges), 3 

civil money penalty (CMP) actions, and 165 MOUs. 

Of these enforcement actions against institutions, 17 

consent orders, 2 CMPs, and 22 MOUs were based, 

in whole or in part, on apparent violations of BSA and 

anti-money laundering (AML) laws and regulations. 

In addition, enforcement actions were also initiated 

against individuals. These actions included, but were 

not limited to, 88 removal and prohibition actions 

under Section 8(e) of the FDI Act (84 consent orders 

and 4 notices of intention to remove/prohibit), 

4 actions under Section 8(b) of the FDI Act (2 

restitution orders and 2 notices of charges), and 24 

CMPs (15 orders to pay and 9 notices of assessment).

The FDIC has heightened its focus on forward-looking 

supervision aimed at ensuring that risks are mitigated 

before they lead to financial deterioration. In 2015, 

the FDIC concluded a two-year effort to train risk 

management supervision staff on forward-looking 

approaches to supervising institutions. 

Compliance

As of December 31, 2015, 51 insured SNM 

institutions, about 1 percent of all supervised 

institutions, with total assets of $61 billion, were 

problem institutions for compliance, CRA, or 

both. All of the problem institutions for compliance 

were rated “4” for compliance purposes, with none 

rated “5.” For CRA purposes, the majority were 

rated “Needs to Improve,” and only five were rated 

“Substantial Noncompliance.” As of December 

31, 2015, all follow-up examinations for problem 

institutions were performed on schedule.

During 2015, the FDIC conducted all required 

compliance and CRA examinations and, when 

violations were identified, completed follow-up visits 

and implemented appropriate enforcement actions in 

accordance with FDIC policy. In completing these 

activities, the FDIC substantially met its internally 

established time standards for the issuance of final 

examination reports and enforcement actions.

FDIC EXAMINATIONS 2013-2015

2015 2014 2013

Risk Management (Safety and Soundness): 

State Nonmember Banks 1,665 1,881 2,077

Savings Banks 206 206 203

State Member Banks 0 0 4

Savings Association 0 0 0

National Banks 0 0 0

Subtotal–Risk Management Examinations 1,871 2,087 2,284

CRA/Compliance Examinations:

Compliance/Community Reinvestment Act 859 1,019 1,201

Compliance-only 478 376 371

CRA-only 10 11 4

Subtotal–CRA/Compliance Examinations 1,347 1,406 1,576

Specialty Examinations:

Trust Departments 365 428 406

Information Technology and Operations 1,886 2,113 2,323

Bank Secrecy Act 1,906 2,126 2,328

Subtotal–Specialty Examinations 4,157 4,667 5,057

Total 7,375 8,160 8,917
28 FEDERAL DEPOSIT INSURANCE CORPORATION

Overall, banks demonstrated strong consumer 

compliance programs. The most significant consumer 

protection issue that emerged from the 2015 

compliance examinations involved banks’ failure 

to adequately monitor third-party vendors. For 

example, the FDIC found violations involving unfair 

or deceptive acts or practices, relating to issues such 

as failure to disclose material information about 

product features and limitations, deceptive marketing 

and sales practices, and misrepresentations about the 

costs of products. As a result, the FDIC issued orders 

requiring consumer restitution and the payment of 

civil money penalties (CMPs).

During 2015, the FDIC initiated 35 formal 

enforcement actions and 28 informal enforcement 

actions to address compliance concerns (see chart 

on page 138). This included 10 consent orders 

(including one that also addressed safety and 

soundness concerns), 7 restitution orders, 18 CMPs, 

and 28 MOUs. Restitution orders are formal actions 

that require institutions to pay restitution in the form 

of consumer refunds for different violations of law. In 

2015, these restitution orders required institutions 

to refund approximately $99.6 million to consumers, 

primarily related to unfair and deceptive practices 

by the institutions. The CMPs totaled just over 

$12.8 million.

Large and Complex Financial Institutions

The FDIC established the Large Bank Supervision 

Branch within the Division of Risk Management 

Supervision in response to the growing complexity 

of large banking organizations. This branch is 

responsible for both supervisory oversight and 

ongoing monitoring, and it supports the insurance 

and resolutions business lines. For SNM banks over 

$10 billion, the FDIC generally applies a continuous 

examination program, whereby dedicated staff 

conduct ongoing onsite supervisory examinations 

and institution monitoring. At institutions where the 

FDIC is not the PFR, staff works closely with other 

financial institution regulatory authorities to identify 

emerging risks and assess the overall risk profile of 

large and complex institutions. 

The Large Insured Depository Institution (LIDI) 

Program remains the primary instrument for off-site 

monitoring of IDIs with $10 billion or more in total 

assets. The LIDI Program provides a comprehensive 

process to standardize data capture and reporting 

through nationwide quantitative and qualitative risk 

analysis of large and complex institutions. In 2015, 

the LIDI Program covered 108 institutions with total 

assets of $12.8 trillion.  The comprehensive LIDI 

Program is essential to effective large bank supervision 

because it captures information on the risks and uses 

that information to best deploy resources to highrisk areas, determine the need for supervisory action, 

and support insurance assessments and resolution 

planning. 

The Shared National Credit (SNC) Program is an 

interagency initiative administered jointly by the 

FDIC, the FRB, and the OCC to ensure consistency 

in the regulatory review of large, syndicated credits, as 

well as identify risk in this market, which comprises 

a large volume of domestic commercial lending. In 

2015, outstanding credit commitments identified in 

the SNC Program totaled $3.9 trillion. The FDIC, 

the FRB, and the OCC issued a joint press release 

detailing the results of the review in November 2015. 

The interagency SNC review indicated credit risk 

in the portfolio remains high, despite a relatively 

favorable economic environment. The agencies noted 

a significant increase in leveraged lending volumes and 

continued loose underwriting, as evidenced by weak 

capital structures and provisions that limit the lender’s 

ability to manage risk. While some improvement in 

underwriting practices was evident in the second half 

of the year, weakness in leveraged lending transactions 

drove an increase in classified commitments. Also, 

in 2015 the agencies agreed to change the program 

timing from an annual review to a semi-annual 

review. A pilot was conducted in September 2015, 

and the 2016 reviews will be completed in February 

and August.

In 2015, the FDIC continued with various initiatives 

to expand knowledge and expertise related to large 

bank supervisory matters. For example, a long-term 

program established in 2014 to expand on-the-
MANAGEMENT'S DISCUSSION AND ANALYSIS 29

job training and provide mentoring of select staff 

regarding examination processes and risk analysis 

at large banks continues as a mechanism to develop 

expertise. The FDIC is also focused on hiring and 

developing additional staff with quantitative skill sets 

to facilitate the evaluation of complex modeling used 

by the largest banks. In addition, several training 

initiatives were developed and implemented in 

2015 that focused on large bank supervisory risks, 

structures, vulnerabilities, and processes.

Bank Secrecy Act/Anti-Money Laundering 

The FDIC, with support from the FRB, OCC, and 

NCUA, facilitated the Spanish translation of the 

FFIEC BSA/AML Examination Manual (BSA/AML 

Manual). The Spanish version of the BSA/AML 

Manual was made public on the FFIEC InfoBase 

in October 2015. The BSA/AML Manual provides 

current guidance on risk-based policies, procedures, 

and processes for banking organizations to comply 

with the BSA and safeguard operations from money 

laundering and terrorist financing. 

In July 2015, the FDIC hosted an Office of Foreign 

Assets Control (OFAC) representative who provided 

training to 30 examiners on recent changes to existing 

U.S. economic sanctions programs, as well as OFAC 

compliance expectations and enforcement case 

studies. The FDIC also participated in the Financial 

Action Task Force’s mutual evaluation of the United 

States’ system for preventing money laundering abuse 

of the financial system.

Information Technology, Cyber Fraud, 

and Financial Crimes 

To highlight the importance and rapidly evolving 

nature of cybersecurity and information technologyrelated risks, a new Operational Risk Branch was 

created within the Division of Risk Management 

Supervision. The new branch has responsibility for 

information technology policy and examinations 

as well as cybersecurity and critical infrastructure 

protection initiatives.

To address the specialized nature of technologyand operations-related supervision, cyber risks, and 

controls in the banking industry, the FDIC routinely 

conducts information technology (IT) and operations 

examinations at FDIC-supervised institutions. The 

FDIC and other banking agencies also conduct IT 

and operations examinations of technology service 

providers (TSPs), which support financial institutions. 

The result of an IT and operations examination is 

a rating under the FFIEC Uniform Rating System 

for Information Technology, which is incorporated 

into the Management component of the Safety and 

Soundness rating and the Safety and Soundness 

Report of Examination.

In 2015, the FDIC conducted 1,886 IT and 

operations examinations at financial institutions and 

TSPs. Further, as part of its ongoing supervision 

process, the FDIC monitors significant events, such 

as data breaches and natural disasters that may affect 

financial institution operations or customers.

In addition to the FDIC’s operations and technology 

examination program, the FDIC regularly monitors 

cybersecurity issues in the banking industry through 

on-site examinations, regulatory reports, and 

intelligence reports. The FDIC works with the 

Financial and Banking Information Infrastructure 

Committee, the Financial Services Sector 

Coordinating Council for Critical Infrastructure 

Protection, Homeland Security, the Financial Services 

Information Sharing and Analysis Center (FSISAC), other regulatory agencies, law enforcement, 

and others to share information regarding emerging 

issues and coordinate responses. Further, the FDIC 

actively participates in the FFIEC’s Cybersecurity and 

Critical Infrastructure Working Group (CCIWG). 

The CCIWG serves as a forum to address policy 

related to cybersecurity and critical infrastructure, 

enables members to communicate and collaborate 

on activities to support and strengthen the resilience 

of the financial services sector, and provides input to 

FFIEC principal members regarding cybersecurity 

matters.
30 FEDERAL DEPOSIT INSURANCE CORPORATION

The FDIC’s major accomplishments during 2015 to 

promote IT security, assess risk management practices, 

and combat cyber fraud and other financial crimes 

included the following:

• Provided nationwide cybersecurity awareness 

training for financial institution management 

and all risk management examination staff at 

all six FDIC regional office locations and by 

teleconference. The training focused on the need 

for banks to establish a culture of managerial and 

directorate collaboration to address cybersecurity 

risks, particularly given the increasing volume and 

sophistication of cyber attacks.

• Produced a video on cybersecurity awareness as part 

of the FDIC’s Community Banking Initiative. The 

video provides useful information to bank directors, 

officers, and employees on cybersecurity. 

• Hosted a nationwide teleconference to discuss 

the FDIC’s regulatory expectations regarding 

cybersecurity preparedness. During the 

teleconference, industry participants submitted and 

asked questions. The call was held in October 2015 

in support of National Cybersecurity Awareness 

Month.

• Added three new scenarios to the FDIC’s 

Cyber Challenge simulation exercise.  The 

exercise encourages community banks to discuss 

operational risk issues and the potential impact of 

information technology disruptions.  The exercise 

now contains seven videos that depict various 

operational disruptions and materials to facilitate 

discussion about how the bank would respond to 

the disruptions.  Lists of reference materials where 

banks can obtain additional information are also 

included.

• Published three FDIC Consumer News articles: 

“Computer Security Tips for Bank Customers: A 

Basic Checklist,” “Mobile Banking and Payments: 

New Uses for Phones...and Even Watches,” and 

“Beware of Thieves Who Target Loan and Credit 

Card Shoppers.”

• Conducted training for all FDIC IT Examiners that 

addressed technology and operational issues facing 

the federal financial regulatory agencies.

• Assisted financial institutions in identifying and 

shutting down “phishing” websites that attempt 

to fraudulently obtain and use an individual’s 

confidential personal or financial information.

• Hired 30 additional IT Examination Analysts 

to enhance the technical expertise of the IT 

supervisory workforce in areas of forensic analysis, 

network systems, payment systems, applications 

development, and business continuity planning/

disaster recovery.

Major interagency accomplishments as a member of 

the FFIEC included the following:

• Published a Cybersecurity Assessment Tool to help 

financial institutions identify risks and determine 

their cybersecurity preparedness. The Assessment 

Tool provides a repeatable and measurable 

process for financial institutions to measure their 

cybersecurity preparedness over time. 

• Collaborated with the FRB and OCC to develop 

a Cybersecurity Evaluation Tool to be used during 

TSP examinations.

• Published FFIEC statements on Cyber Attacks 

Compromising Credentials and Destructive 

Malware. 

• Issued an appendix to the Business Continuity 

Planning (BCP) booklet of the FFIEC Information 

Technology Examination Handbook entitled 

“Strengthening the Resilience of Outsourced 

Technology Services.” The booklet is part of the 

IT Examination Handbook series. The appendix 

highlights and strengthens the BCP Booklet in four 

specific areas: Third-Party Management, Third-Party 

Capacity, Testing with Technology Service Providers, 

and Cyber Resilience.

• Revised the Management booklet of the FFIEC IT 

Examination Handbook to incorporate cybersecurity 

and cyber resiliency concepts as part of information 

security.

• Improved information sharing on identified 

technology risks among the IT examination 

workforces of the FFIEC member agencies through 

discussions at the March 2015 annual Supervisory 

Strategy meeting.
MANAGEMENT'S DISCUSSION AND ANALYSIS 31

Minority Depository Institution Activities

The preservation of minority depository institutions 

(MDIs) remains a high priority for the FDIC. 

In 2015, the FDIC continued to advocate for 

MDI and Community Development Financial 

Institution (CDFI) industry-led strategies for 

success. The institutions were encouraged to build 

on the results of the 2013 Interagency MDI and 

CDFI Bank Conference and the FDIC’s 2014 study 

on MDIs entitled Minority Depository Institutions: 

Structure, Performance and Social Impact. These 

strategies include industry-led solutions; MDI and 

CDFI bankers working together to tell their story; 

collaborative approaches to partnerships to share 

costs, raise capital, or pool loans; technical assistance; 

and innovative use of federal programs. 

In June 2015, the FDIC sponsored a roundtable 

in Salt Lake City, Utah, with three trade groups 

representing nearly 100 MDIs and CDFIs and 

approximately 20 representatives of potential bank 

partners to discuss CRA partnerships. The FDIC 

provided an overview of five CRA community 

development activities related to minority and 

women-owned financial institutions. The trade 

groups outlined the community development needs 

of their members that might be opportunities for the 

banks to invest in or develop partnerships. The banks 

had the opportunity to engage in dialog with the 

MDI representatives. The trade groups and the banks 

will continue to build upon these initial discussions 

following the roundtable.

The FDIC co-sponsored with the OCC and the 

FRB the 2015 Interagency MDI and CDFI Bank 

Conference, held in July. Nearly 110 bankers from 

72 banks attended the Celebrate 150 Years of Minority 

Depository Institutions: Changes, Challenges and 

Opportunities conference. The conference featured 

an interactive panel with FDIC Chairman Martin 

J. Gruenberg, Federal Reserve Board Governor Lael 

Brainard, and Comptroller of the Currency Thomas 

J. Curry. The conference encouraged interactive 

discussion among those who believe MDIs and 

CDFIs are uniquely positioned to create positive 

change in their communities. In addition, senior 

officials from federal agencies provided updates on 

programs and policies that can help MDIs and CDFIs 

achieve goals.

The FDIC also continues to pursue ways to improve 

communication and interaction with MDIs and to 

respond to the concerns of minority bankers. In 

addition to active outreach with MDI trade groups, 

the FDIC annually offers to arrange meetings between 

regional management and each MDI’s board of 

directors to discuss issues of interest. In addition, the 

FDIC routinely contacts MDIs to offer return visits 

and technical assistance following the conclusion of 

FDIC safety and soundness, compliance, CRA, and 

specialty examinations to assist bank management 

in understanding and implementing examination 

recommendations. These return visits, normally 

conducted 90 to 120 days after the examination, 

are to provide recommendations or feedback for 

improving operations, not to identify new issues. 

MDIs also may initiate contact with the FDIC to 

request technical assistance at any time. In 2015, the 

FDIC provided 101 individual technical assistance 

sessions on approximately 50 risk management and 

compliance topics, including the following:

• Accounting

• Bank Secrecy Act and Anti-Money Laundering

• Basel III Capital Rules

• Brokered Deposits/Waivers

• Capital Planning

• Commercial Real Estate Concentrations

• Community Reinvestment Act

• Funding and Liquidity

• Global Cash Flow

• High Volatility Commercial Real Estate

• Information Technology Risk Management and 

Security

• Interest Rate Risk

• Loan Underwriting and Administration 
32 FEDERAL DEPOSIT INSURANCE CORPORATION

• Qualified Mortgage Rules

• Strategic Planning

• Third-Party Risk Management

The FDIC regional offices also held outreach, 

training, and educational programs for MDIs through 

conference calls and banker roundtables. In 2015, 

topics of discussion for these sessions included many 

of those listed above, as well as cybersecurity, vendor 

management, and the FDIC’s Community Banking 

Initiative, including the Technical Assistance Videos.

Economic Growth and Regulatory Paperwork 

Reduction Act

The FDIC, along with the other banking regulatory 

agencies, launched a cooperative, three-year effort to 

review all of their regulations. This review started in 

2014 and continued throughout 2015. The purpose 

of the review, which is mandated by the Economic 

Growth and Regulatory Paperwork Reduction Act 

of 1996 (EGRPRA), is to identify and eliminate 

any regulatory requirements that are outdated or 

otherwise unnecessary.

To facilitate the review, the agencies categorized 

their regulations into 12 separate groups. Over the 

course of two years, the groups of regulations are 

being published for comment, providing industry 

participants, consumer and community groups, and 

other interested parties an opportunity to identify 

regulatory requirements they believe are no longer 

needed or should be modified. The agencies are 

analyzing the comments received and considering 

amendments to their regulations where appropriate.

On May 14, 2015, the public comment period 

closed for the regulations in the categories of 

Banking Operations, Capital, and the Community 

Reinvestment Act; approximately 23 comment letters 

were received.

On September 3, 2015, the comment period closed 

for rules relating to Consumer Protection; Directors, 

Officers and Employees; and Anti-Money Laundering. 

Approximately 16 comment letters were received.

On December 23, 2015, the agencies published the 

fourth Federal Register notice requesting comment 

on regulations regarding Securities, Safety and 

Soundness, and Rules of Procedure as well as all 

regulations the agencies have recently finalized, 

including those rules that the agencies have yet to 

fully implement. The comment period closes on 

March 22, 2016.

As a part of the regulatory burden reduction effort, 

the agencies hosted five nationwide outreach meetings 

during 2015 to facilitate awareness of the EGRPRA 

project and to listen to stakeholder comments and 

suggestions. Each meeting featured three banker 

panels covering the 12 categories of regulations and 

a consumer/community group panel. The outreach 

meetings were held at the Federal Reserve Banks in 

Dallas, Texas; Boston, Massachusetts; Kansas City, 

Missouri; and Chicago, Illinois; and at the FDIC in 

Arlington, Virginia. More than 1,030 individuals 

participated in the meetings in-person, by telephone, 

or via webcast. The Kansas City meeting focused on 

rural bank issues. 

Several themes have emerged through the EGRPRA 

process that could affect community banks. One 

consistent item has been the discussion of whether 

laws and regulations based on long-standing 

thresholds should be changed.

In addition, due in part to feedback received as part 

of the EGRPRA review, the FDIC and the other 

FFIEC member entities are undertaking a community 

bank Call Report burden-reduction initiative. The 

objective of this initiative, which comprises actions 

in five areas, is to streamline and simplify regulatory 

reporting requirements for community banks. As 

an initial step, the banking agencies, under the 

auspices of the FFIEC, published proposed Call 

Report revisions, including a first set of proposed 

burden-reducing changes, on September 18, 2015. 

The agencies are evaluating the comments on the 

proposal and would begin to implement the revisions 

in the third quarter of 2016. As a second action, 

the banking agencies have accelerated the start of 

a statutorily mandated review of the existing Call 
MANAGEMENT'S DISCUSSION AND ANALYSIS 33

Report data items, which otherwise would have 

commenced in 2017. Third, the FFIEC member 

entities are considering the feasibility and merits of 

creating a less burdensome version of the Call Report 

for small institutions. A fourth action for the FFIEC 

member entities is to better understand, through 

industry, the aspects of community banks’ Call Report 

preparation processes that are significant sources 

of reporting burden. This outreach effort included 

on-site visits to nine community banks during third 

quarter 2015 to learn about their reporting processes. 

Finally, the FFIEC and the agencies will offer periodic 

banker training by teleconferences and webinars to 

explain upcoming reporting changes and provide 

guidance on Call Report requirements that bankers 

find challenging.

Under Section 316(b) of the Dodd-Frank Act, rules 

transferred from the Office of Thrift Supervision 

(OTS) to the FDIC and other successor agencies 

remain in effect ‘‘until modified, terminated, set 

aside, or superseded in accordance with applicable 

law’’ by the relevant successor agency, by a court 

of competent jurisdiction, or by operation of law. 

When the FDIC republished the transferred OTS 

regulations as new FDIC regulations applicable to 

state savings associations, the FDIC stated in the 

Federal Register notice that its staff would evaluate the 

transferred OTS rules and might later recommend 

incorporating the transferred OTS regulations into 

other FDIC rules, amending them, or rescinding 

them. This process began in 2013 and continues, 

involving publication in the Federal Register of a 

series of NPRs and rulemakings. In 2015, the FDIC 

removed ten transferred OTS rules while making 

technical amendments to related FDIC rules for 

applicability to state savings associations. In addition, 

the FDIC repealed two transferred OTS rules that 

did not have corresponding FDIC rules and were 

deemed unnecessary to retain. The rules repealed 

were Possession by Conservators and Receivers for 

Federal and State Savings Associations, and Electronic 

Operations.

Other Rulemaking and Guidance Issued

During 2015, the FDIC issued and participated in the 

issuance of other rulemaking and guidance in several 

areas as described below.

Brokered Deposit Guidance 

In January 2015, the FDIC issued FIL-2-2015 titled 

Guidance on Identifying, Accepting, and Reporting 

Brokered Deposits due to numerous questions regarding 

brokered deposit determinations. This FIL provided 

a series of FAQs regarding identifying, accepting, and 

reporting brokered deposits. The FAQs are based on 

Section 29 of the FDI Act and Section 337.6 of the 

FDIC Rules and Regulations, as well as on advisory 

opinions and the Study on Core Deposits and Brokered 

Deposits, which the FDIC issued in July 2011. The 

FDIC issued the FAQs in a plain language summary of 

previously issued guidance that is conveniently located 

in one place. In response to follow-up inquiries, the 

FDIC hosted an industry call on April 22, 2015, 

to further discuss the FIL and FAQs. Further, on 

November 13, 2015, the FDIC issued an update to 

the FAQs document in response to additional inquiries 

and requested public comments on those FAQs. The 

comment period on the updated document closed on 

December 28, 2015. 

Statement on Providing Banking Services 

In January 2015, the FDIC issued the Statement on 

Providing Banking Services (FIL-5-2015) to encourage 

institutions to take a risk-based approach in assessing 

individual customer relationships rather than declining 

to provide banking services to entire categories of 

customers, without regard to the risks presented by an 

individual customer or the financial institution’s ability 

to manage the risk. 

Guidance on Private Student Loans with Graduated 

Repayment Terms at Loan Origination

In February 2015, the FDIC, jointly with the FRB, 

CFPB, NCUA, and the OCC and in conjunction with 

the State Liaison Committee (SLC), issued student 
34 FEDERAL DEPOSIT INSURANCE CORPORATION

loan guidance, which provides principles that financial 

institutions should consider in their policies and 

procedures for originating private student loans with 

graduated repayment terms. The guidance recognizes 

that students leaving a higher education program 

may prefer more flexibility with their payments as 

they transition into the labor market. It also reminds 

financial institutions that originate private student 

loans with graduated repayment terms to prudently 

underwrite the loans and provide disclosures that 

clearly communicate the timing and the amount of 

payments to facilitate a borrower’s understanding of 

the loan’s terms and features.

Filing Requirements and Processing Procedures for 

Changes in Control 

In October 2015, the FDIC approved a final rule that 

amends Part 303 of the FDIC Rules and Regulations 

for filing requirements and processing procedures 

for notices filed under the Change in Bank Control 

Act (Notices). The final rule consolidated into one 

subpart the requirements and procedures for Notices 

filed with respect to state nonmember banks and state 

savings associations and eliminated Part 391, subpart 

E. The final rule also adopted certain practices of 

related regulations of the OCC and the FRB. The 

final rule clarifies the FDIC’s requirements and 

procedures based on its experience interpreting and 

implementing the existing regulation and is part of 

the FDIC’s continuing review of its regulations under 

EGRPRA. 

Rescission of the Temporary Liquidity 

Guarantee Program

In October 2015, the FDIC rescinded Part 370 of the 

FDIC Rules and Regulations, which implemented 

the Temporary Liquidity Guarantee Program 

(TLGP). The TLGP was composed of two distinct 

components, the Debt Guarantee Program (DGP) 

and the Transaction Account Guarantee Program 

(TAGP). The DGP provided a temporary FDIC 

guarantee for all newly issued senior unsecured debt 

issued by participating entities up to prescribed 

limits, and the TAGP provided for the extension of 

unlimited deposit insurance for noninterest-bearing 

transaction accounts. Both programs had previously 

expired.

Clarifying Approach to Banks Offering Products 

and Services, such as Deposit Accounts and 

Extensions of Credit, to Nonbank Payday Lenders

In November 2015, the FDIC issued FIL-52-2015 

clarifying its approach to banks offering products and 

services to nonbank payday lenders. The FIL reissued 

and updated FIL-14-2005, Payday Lending Programs: 

Revised Examination Guidance, and its attachment, 

Revised Guidelines for Payday Lending. The guidance 

was revised to make clear that it applies only to 

banks making payday loans. It does not apply to 

banks offering products and services, such as deposit 

accounts and extensions of credit, to nonbank payday 

lenders. 

In addition, the aforementioned FILs reiterate the 

FDIC’s longstanding policy that financial institutions 

that properly manage customer relationships and 

effectively mitigate risks are neither prohibited nor 

discouraged from providing services to any category of 

customer accounts or individual customer operating 

in compliance with applicable state and federal law.

Advisory on Effective Risk Management 

Practices for Purchased Loans and Purchased 

Loan Participations

In November 2015, the FDIC issued FIL-49-2015 to 

update and replace the FDIC Advisory on 

Effective Credit Risk Management Practices for 

Purchased Loan Participations (FIL-38-2012, issued 

in September 2012). The updated Advisory reminds 

FDIC-supervised institutions of the importance of 

underwriting and administering purchased loans and 

loan participations in the same diligent manner as if 

they were being directly originated by the purchasing 

institution. It also outlines areas that should be 

considered before purchasing a loan or participation 

or entering into a third-party arrangement to purchase 

or participate in loans. More specifically, FDIC-
MANAGEMENT'S DISCUSSION AND ANALYSIS 35

supervised institutions should: (1) ensure that loan 

policies address the purchases; (2) understand the 

terms and limitations of agreements; (3) perform 

appropriate due diligence; and (4) obtain necessary 

board or committee approvals. Finally, the Advisory 

reminds institutions that third-party arrangements 

to facilitate loan and loan participation purchases 

should be managed by an effective third-party risk 

management process. The Advisory is based on 

existing guidance, including Guidance for Managing 

Third-Party Risk and Interagency Guidelines 

Establishing Standards for Safety and Soundness 

(Appendix A to Part 364 of the FDIC Rules and 

Regulations).

Statement on Prudent Risk Management for 

Commercial Real Estate Lending

In December 2015, the FDIC, FRB, and OCC 

jointly issued a statement to remind financial 

institutions of existing regulatory guidance on 

prudent risk management practices for commercial 

real estate (CRE) lending activity through economic 

cycles. 

The guidance reminds financial institutions that they 

should maintain underwriting discipline and exercise 

prudent risk management practices that identify, 

manage, monitor, and control the risks arising from 

their CRE lending activity.

Regulatory Relief 

During 2015, the FDIC issued ten FILs that provide 

guidance to help financial institutions and to facilitate 

recovery in areas affected by tornadoes, flooding, wild 

fires, landslides, mudslides, and other severe events. 

In these FILs, the FDIC encouraged banks to work 

constructively with borrowers experiencing financial 

difficulties as a result of natural disasters. The FILs 

also 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. 

Depositor and Consumer Protection 

Rulemaking and Guidance

Joint Final Rule on Loans in Areas Having Special 

Flood Hazards

In June 2015, the FDIC issued a final rule, 

jointly with the OCC, FRB, NCUA, and FCA, 

amending the FDIC’s flood insurance regulation 

and implementing certain provisions in the BiggertWaters Flood Insurance Reform Act of 2012 and the 

Homeowner Flood Insurance Affordability Act of 

2014. Specifically, the final rule addressed detached 

structures, force placement of flood insurance, 

escrowing flood insurance premiums and fees, and 

notice of special flood hazards. 

Interagency Examination Procedures for 

the Truth in Lending Act (Regulation Z) and Real 

Estate Settlement Procedures 

Act (Regulation X) Mortgage Rules

In June 2015, the FDIC released revised interagency 

examination procedures for the new Truth in Lending 

Act (TILA) - Real Estate Settlement Procedures 

Act (RESPA) Integrated Disclosure Rule (TRID 

Rule), as well as amendments to other provisions of 

TILA Regulation Z and RESPA Regulation X. The 

procedures were developed in coordination with 

member agencies of the FFIEC. The examination 

procedures should help financial institutions better 

understand the areas on which the FDIC will focus as 

part of the examination process.

Financial Institution Letter Regarding Military 

Lending Act Final Rule

In September 2015, the FDIC issued FIL-37-2015 

to notify FDIC-supervised institutions that the 

Department of Defense (DOD) promulgated a 

final rule amending the implementing regulations 

of the Military Lending Act of 2006 (MLA). The 

final rule expands specific protections provided to 

service members and their families under the MLA 

and addresses a wider range of credit products than 

the DOD’s previous regulation. FDIC-supervised 
36 FEDERAL DEPOSIT INSURANCE CORPORATION

institutions and other creditors must comply with the 

rule for new covered transactions beginning October 

3, 2016. For credit extended in a new credit card 

account under an open-end consumer credit plan, 

compliance is required beginning October 3, 2017.

Guidance on Supervisory Expectations for 

Financial Institutions Implementing the Truth 

in Lending Act (Regulation Z) and Real Estate 

Settlement Procedures Act (Regulation X) 

Integrated Disclosure Rule

In October 2015, the FDIC issued FIL-43-2015 

providing guidance on initial supervisory expectations 

in connection with examinations of financial 

institutions for compliance with the TRID Rule, 

which became effective on October 3, 2015. During 

initial examinations for compliance with the TRID 

Rule, FDIC examiners will evaluate an institution’s 

compliance management system and overall efforts to 

come into compliance, recognizing the scope and scale 

of changes necessary for each supervised institution to 

achieve effective compliance. The FDIC’s supervisory 

approach regarding the TRID Rule is similar to the 

approach the FDIC took in initial examinations 

for compliance with the Ability-to-Repay/Qualified 

Mortgage rules that became effective in January 2014.

Promoting Economic Inclusion

The FDIC is strongly committed to promoting 

consumer access to a broad array of banking products 

to meet consumer financial needs. To promote 

financial access to responsible and sustainable 

products offered by IDIs, the FDIC:

• Conducts research on the unbanked and 

underbanked.

• Engages in research and development on models 

of products meeting the needs of lower-income 

consumers.

• Supports partnerships to promote consumer access 

and use of banking services.

• Advances financial education and literacy.

• Facilitates partnerships to support community and 

small business development.

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 mainstream banking services to 

underserved populations. This may include reviewing 

basic retail financial services such as low-cost, safe 

transaction accounts, affordable small-dollar loans, 

savings accounts, and other services that promote 

individual asset accumulation and financial stability. 

During 2015, the ComE-IN met in May and October 

to discuss approaches to expanding access to Safe 

accounts, the economic inclusion potential of mobile 

financial services, financial education opportunities 

for young people, qualitative research into economic 

inclusion strategies for individuals with disabilities, 

and Money Smart for Small Business. 

FDIC National Survey of Unbanked and 

Underbanked Households and Related Research

As part of its ongoing commitment to expanding 

economic inclusion in the United States, the FDIC 

works to fill the research and data gap regarding 

household participation in mainstream banking and 

the use of nonbank financial services. In addition, 

Section 7 of the Federal Deposit Insurance Reform 

Conforming Amendments Act of 2005 (Reform 

Act) mandates that the FDIC regularly report on 

underserved populations and bank efforts to bring 

Progress was noted on several fronts by the Economic Inclusion 

Committee. FDIC Chairman Martin J. Gruenberg presided over 

the meeting.
MANAGEMENT'S DISCUSSION AND ANALYSIS 37

individuals and families into the conventional finance 

system. In response, the FDIC regularly conducts and 

reports on surveys of households and banks to inform 

the efforts of financial institutions, policymakers, 

regulators, researchers, academics, and others.

During 2015, the FDIC revised, tested, and 

administered the 2015 FDIC National Survey 

of Unbanked and Underbanked Households, in 

partnership with the U.S. Census Bureau. The 

survey focuses on basic checking and savings account 

ownership, but it also explores household use of 

alternative financial services to better understand the 

extent to which families are meeting their financial 

needs outside of mainstream financial institutions. In 

addition, the survey incorporated questions designed 

to assess the typical monthly financial services 

consumption patterns and to better understand 

household use of bank and nonbank consumer credit 

instruments. A full report is expected in 2016. 

In 2015, the FDIC also launched two qualitative 

research projects to further develop insights in this 

area. In the first, the FDIC conducted consumer 

research to better understand the economic inclusion 

potential of mobile financial services. Initial findings 

confirmed and provided more detailed insights 

into the opportunity of mobile financial services to 

improve the sustainability of banking relationships. 

In the second, the FDIC initiated interviews with 

bankers and other stakeholders to better understand 

the programs, products, and strategies that banks are 

finding useful for attracting and retaining unbanked 

households as customers.

Partnerships for Access to Mainstream Banking 

The FDIC supports broadening consumer access to 

mainstream banking through work with the Alliances 

for Economic Inclusion (AEI), Bank On initiatives, 

local and state government, and in collaboration 

with federal partners and many local and national 

organizations. The FDIC also collaborates with other 

financial regulatory agencies to provide information 

and technical assistance on community development.  

Local collaborations are many and diverse. The FDIC 

sponsored or co-sponsored more than 98 events 

during 2015 that provided opportunities for partners 

to collaborate on increasing access to bank accounts 

and credit services, opportunities to build savings and 

improve credit histories, and initiatives to significantly 

strengthen financial capability of community service 

providers who directly serve low- and moderateincome consumers.

During 2015, the FDIC helped convene financial 

institutions, community organizations, local, state, 

and federal agencies, and other partners to support 

coalitions that bring unbanked and underbanked 

consumers and owners of small businesses into the 

financial mainstream through the FDIC’s 14 area 

AEIs. AEI committees and working groups addressed 

specific challenges and financial services needs in their 

communities including education on the specific 

needs of unbanked and underbanked consumers, 

credit building training and seminars for community 

service providers and asset building organizations, 

workshops for financial coaches and counselors, 

promotion of savings opportunities for low- and 

moderate-income people and communities, outreach 

to bring larger numbers of people to expanded tax 

preparation assistance sites, and education for business 

owners to help them become bankable. 

The FDIC also provided information and technical 

assistance in the development of safe and affordable 

transaction and savings accounts. In over 30 markets, 

the FDIC provided technical assistance to local Bank 

On initiatives and asset building coalition activities 

designed to reduce barriers to banking and increase 

access to the financial mainstream. For example, 

the FDIC collaborated with the Cities for Financial 

Empowerment Fund to support its national efforts 

to work with local government and other partners to 

increase the access of low- or moderate-income (LMI) 

consumers to safe and affordable financial products 

and services. In October 2015, FDIC Chairman 

Martin J. Gruenberg addressed the national launch of 

Bank On’s national account standards in San Francisco 

to advance strategies to expand access to products that 

are consistent with the FDIC’s Safe Account model. 
38 FEDERAL DEPOSIT INSURANCE CORPORATION

The FDIC also supported efforts to link consumers 

to financial education and savings through activities 

organized for designated Money Smart or “financial 

fitness” weeks or months, involving hundreds of 

consumer outreach events. Moreover, working 

with the national, local, state, and targeted (youth, 

military, and minority consumer-focused) America 

Saves campaigns, the FDIC continued to link banking 

companies to active efforts for engaging consumers 

with setting savings goals at tax time and year round. 

Advancing Financial Education 

Financial education helps consumers understand and 

use bank products effectively and sustain a banking 

relationship over time. The FDIC continued to be 

a leader in developing high-quality, free financial 

education resources and pursuing collaborations to 

use those tools to educate the public. The FDIC’s 

work during 2015 dealt primarily with young people, 

consistent with the Financial Literacy and Education 

Commission’s focus on Starting Early for Financial 

Success.

In April 2015, the FDIC and the CFPB launched new 

educational tools for parents, students, and teachers. 

The new Money Smart for Young People series consists 

of four new age-appropriate curricula that are aligned 

with key academic standards. Unlike previous Money 

Smart products, these new tools involve educators, 

parents/caregivers, and young people in the 

learning process. 

Strategic collaborations continue to be a critical 

component of the FDIC’s financial education 

efforts. The FDIC emphasizes the importance of 

pairing education with access to appropriate banking 

products and services through outreach. Working 

through coalitions, the FDIC participated as a 

speaker or exhibitor at 28 conferences and events that 

reached an estimated 10,000 people. As part of a 

small pilot project, the FDIC also provided training 

to 60 teachers in three jurisdictions on Money Smart

for Young People as part of an initiative to better 

understand how the curriculum can be used and 

supported. 

During 2015, the FDIC launched the second 

phase of the Youth Savings Pilot Program, aimed at 

identifying and highlighting promising approaches 

to offering financial education tied to the opening 

of safe, low-cost savings accounts for school-aged 

children. In the second phase, the FDIC selected 

12 banks to join with the 9 banks selected in 2014 

for the first phase. The FDIC facilitated discussions 

and knowledge sharing among the Pilot participants 

to talk about program design and structure, such as 

approaches to program evaluation, offering incentives, 

and opening accounts. The FDIC also responded to 

a range of inquiries from banks on technical issues 

to support their youth savings initiatives. The Pilot 

will culminate with a report in the fall of 2016 that 

will communicate lessons learned and offer promising 

practices for banks to work with schools or other 

organizations to combine financial education with 

access to savings accounts. 

To support these types of collaborations, the FDIC, 

the FRB, the NCUA, the OCC, and the U.S. 

Department of the Treasury’s Financial Crimes 

Enforcement Network (FinCEN) issued Interagency 

Guidance to Encourage Financial Institution Youth 

Savings Programs and Address Related Frequently Asked 

Questions in February 2015. The guidance is intended 

to encourage financial institutions to develop 

and implement programs to expand the financial 

capability of youth and build opportunities for 

financial inclusion for more families. It also addresses 

frequently asked questions that may arise as financial Chairman Gruenberg unveils the Money Smart for Young People 

education curriculum at a Jump$tart® Coalition meeting.
MANAGEMENT'S DISCUSSION AND ANALYSIS 39

institutions collaborate with schools, local and state 

governments, nonprofit organizations, or corporate 

entities to facilitate youth savings and financial 

education programs.

While youth materials were the strategic focus 

during 2015, the FDIC also enhanced Money Smart

program products for other audiences. For example, 

the instructor-led Money Smart materials for adults 

were updated to reflect the new mortgage disclosure 

rules. In addition, three new modules were added to 

the Money Smart for Small Business curriculum, using 

feedback from the small business technical assistance 

organizations that are also Money Smart Alliance 

members. The three new modules, developed jointly 

with the Small Business Administration (SBA), were 

added to help aspiring entrepreneurs learn about 

business ownership, gain a realistic perspective on 

costs of starting a business, and understand the 

purpose of cash flow management. In addition, the 

entire small business curriculum was made available in 

Spanish during 2015.

The FDIC continues to strengthen collaboration 

with the SBA and other small business resources 

beyond training. In 2015, each of the six FDIC 

regional Community Affairs teams sponsored 25 

regional events for banks and the SBA and its SBA 

Resource Partner Network (SCORE, Small Business 

Development Centers and Women’s Business Centers, 

and Veteran’s Business Outreach Centers) to convene 

and discuss collaborations or provide technical 

assistance to small business leaders. 

Community Development

In 2015, the FDIC provided technical assistance to 

banks and community organizations through 111 

outreach events designed to foster understanding and 

practical relationships between financial institutions 

and other community development resources and 

stakeholders and to improve knowledge about the 

CRA. 

The FDIC’s work particularly emphasized sharing 

information to support bank efforts to provide 

prudent access to responsible mortgage credit in 

underserved markets and improve the banking 

connections of small businesses. In addition, the 

FDIC sponsored sessions with interagency partners 

covering basic and advanced CRA training for banks. 

The agencies also offered CRA basics for communitybased organizations as well as seminars on establishing 

effective bank-community collaborations for 

community development. 

During 2015, the FDIC, other federal regulators, 

and federal and state housing agencies hosted two 

housing roundtable discussions and two housing 

workshops to offer technical assistance to help expand 

access to mortgage credit for LMI households. 

During these events, banks and program managers 

shared experiences with federal mortgage guarantee 

and secondary market programs and state and local 

down payment assistance and counseling programs. 

They offered details of their work so that audiences 

could gain a better understanding of how to address 

challenges and identify opportunities for expanding 

participation in these programs. 

Community Banking Initiatives

Community banks provide traditional, relationshipbased banking services in their local communities. 

These banks accounted for 13 percent of banking 

industry assets; however, this measure vastly 

understates the importance of these institutions to 

the U.S. economy and local communities across the 

nation. For example, community banks hold 44 

percent of the industry’s small loans to farms and 

businesses, making them the lifeline to entrepreneurs 

and small enterprises of all types. Community banks 

also 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 2015, community 

banks held more than 75 percent of deposits in 

more than 1,200 U.S. counties. In over 600 of 

these counties, the only banking offices available to 

consumers were those operated by community banks. 

The FDIC is the lead federal supervisor for the 

majority of community banks and the insurer of all 

IDIs. The FDIC has a particular responsibility for 
40 FEDERAL DEPOSIT INSURANCE CORPORATION

the safety and soundness of community banks and 

for understanding and communicating the role they 

play in the banking system. Accordingly, the FDIC 

in 2012 launched a Community Banking Initiative 

focused on publishing new research on issues of 

importance to community banks and providing 

resources that will be useful to their efforts to manage 

risks, enhance the expertise of their staff, and better 

understand changes in the regulatory environment. 

The FDIC continues to pursue an ambitious research 

agenda on community banks. Since the 2012 

publication of the FDIC Community Banking Study, 

FDIC researchers have published ten additional 

studies on topics ranging from small business 

financing to the factors that have driven industry 

consolidation over the past 30 years. During 2015, 

the FDIC published studies on recent trends in 

branch banking; the challenges and opportunities 

facing small, closely held community banks; and an 

updated model of economies of scale at community 

banks. The Community Bank Performance section 

of the FDIC Quarterly Banking Profile (QBP), first 

introduced in 2014, continues to provide 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 net income at community banks continued to 

grow at double-digit annual rates in 2015, while total 

loans and leases at these institutions grew at a rate that 

was substantially faster than the industry as a whole.

Community Banking Research 

Highlights from 2015 

In 2015, FDIC economists published important 

research analyzing branch banking and the 

management and closely held ownership among 

community banks. 

Branch Banking

During the historic period of charter consolidation in 

U.S. banking since 1985, the number of banks and 

thrifts has declined by almost two-thirds. Yet, FDICinsured institutions continue to operate about 93,000 

banking offices—only 6 percent fewer than the 

all-time high reached in 2009. Even after the waves 

of new banking technologies introduced in recent 

decades, the density of U.S. banking offices per capita 

stands higher today than at any time before 1977. 

This relative stability in brick-and-mortar offices 

suggests that they remain useful in providing banking 

services even in the era of mobile banking. This is 

especially the case for community banks, which were 

shown to open new banking offices more frequently 

and to close existing banking offices less frequently 

than larger noncommunity banks (see chart on 

page 41). Even as technology marches forward, 

branch offices appear to remain an integral channel 

through which banks serve their customers and earn 

their trust.

Closely Held Ownership

Small, closely held banks are often thought to 

experience certain disadvantages compared to their 

larger competitors. They seldom have ready access to 

the capital markets, and may find it hard to recruit 

management talent from outside the bank. Yet a new 

FDIC study shows that small, closely held community 

banks have consistently outperformed widely held 

institutions in recent years in terms of return on assets 

(see chart on page 42) and operational efficiency. 

What is the secret of their success? In a sample of 

nearly 1,400 community banks in three supervisory 

regions, nearly 75 percent were deemed by FDIC 

examiners to be “closely held” by an ownership 

group that was almost always based on family or 

community ties, or both. In almost 60 percent 

of these institutions, the key officer that managed 

the bank was either part of or affiliated with the 

ownership group. Moreover, this set of institutions—

where ownership and management overlap—has 

reported the highest financial performance since 

2009, suggesting that bank profitability may improve 

if ownership and management share the same goals. 

The real challenge for small, closely held banks may 

be to find equally qualified successors to manage the 

institution over the long run.
MANAGEMENT'S DISCUSSION AND ANALYSIS 41

Apart from research, the Community Bank Initiative 

includes a robust technical assistance program for 

bank directors, officers, and employees. The technical 

assistance program includes Directors’ College events 

held across the country, industry teleconferences, and 

a video program. 

In 2015, the FDIC hosted 47 Directors’ College 

events. These events were typically conducted jointly 

with state trade associations and addressed issues 

such as corporate governance, regulatory capital, 

community banking, concentrations management, 

consumer protection, the Bank Secrecy Act, and 

interest rate risk, among others. In addition, the 

FDIC hosted five industry teleconferences on a 

range of topics of interest to community bankers, 

including brokered deposits, cybersecurity awareness, 

the implementation of CFPB’s mortgage rules, the 

interagency rule on loans in areas with special flood 

hazards, and youth savings programs. The FDIC also 

participated in two FFIEC industry teleconferences 

regarding regulatory capital reporting changes. In 

addition, the FDIC offered four deposit insurance 

coverage seminars for bank officers and employees 

in 2015. These free seminars, which were offered 

nationwide, particularly benefitted smaller institutions 

that have limited training resources. The FDIC also 

released three deposit insurance seminar training 

videos on the FDIC’s website and YouTube channel. 

Among other FDIC technical assistance initiatives 

is the Directors’ Resource Center, a special section of 

the FDIC’s website that provides useful information 

to bank directors, officers, and employees on areas 

of supervisory focus and regulatory changes. One 

key element of this resource center is a Technical 

Assistance Video Program that offers in-depth, 

technical training for bankers to view at their 

-20 -15 -10 -5 0 5 10 15

Percent Change in Number of Offices, 2008-2014

Community Banks Noncommunity Banks

Net Change

-8.8%

-13.0%

-8.6%

-17.3%

+11.5%

+9.5%

+5.1%

+1.3%

+0.8%

Net Change

-1.9% Source of Change:

Gross Office Openings

Gross Office Closings

Net Transfer Between Groups

Net Offices Added to Survey

COMMUNITY BANKS HAVE TENDED TO OPEN MORE 

NEW OFFICES AND CLOSE FEWER EXISTING OFFICES 

THAN NONCOMMUNITY BANKS

Source: Breitenstein, Eric C. and John M. McGee, “Brick-and-Mortar Banking Remains Prevalent in an Increasingly 

Virtual World,” FDIC Quarterly, Vol. 9, No. 1, 2015. FDIC calculations based on Summary of Deposits (SOD) data.
42 FEDERAL DEPOSIT INSURANCE CORPORATION

convenience. During 2015, the FDIC released three 

technical assistance videos on cybersecurity awareness, 

the Loan Originator Compensation Rule, and the 

Servicing Rule. In addition, the FDIC expanded an 

existing resource—the FDIC’s Cyber Challenge: A 

Community Bank Cyber Exercise—to include three 

additional exercises. In 2015, the FDIC surveyed 

almost 800 financial institutions to obtain feedback 

on the Technical Assistance Video Program. The 

survey requested comments on the program as a 

whole and on individual videos within the program 

and asked for suggestions for the program, including 

topics for new videos. The FDIC is evaluating the 

feedback received.

Finally, the FDIC’s Advisory Committee on 

Community Banking is an ongoing forum for 

discussing current issues and receiving valuable 

feedback from the industry. The committee, which 

met three times during 2015, is composed of 15 

community bank CEOs from around the country. It 

is a valuable resource for input on a wide variety 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 FDIC continues to promote open 

communication with industry members during 

these meetings, including feedback on the preexamination planning process. The FDIC’s electronic 

pre-examination planning package, launched in 

2013, has enabled examiners to tailor examination 

information requests to the particular characteristics 

and risk profile of the institution, thereby reducing 

the amount of the information requested. The FDIC 

continues to monitor industry feedback on this 

process from outreach events and through the Post 

CLOSELY HELD COMMUNITY BANKS WHERE OWNERSHIP 

AND MANAGERIAL CONTROL OVERLAP HAVE CONSISTENTLY 

REPORTED HIGHER PROFITABILITY

Source: Anderlik, John, M., Richard A. Brown, and Kathryn L. Fritzdixon. “Financial Performance and Management Structure of 

Small, Closely Held Banks,” FDIC Quarterly, Vol. 10, No. 1, 2016. 

Closely held community banks are owned by an identifiable primary owner or ownership group. Closely held banks where there is 

overlap are run by a key officer that is part of or affiliated with that ownership group.

1.4%

1.2%

Widely Held

Pretax Return on Assets

Percentage

Closely Held

2009 2010 2011 2012 2013 2014

1.0%

0.8%

0.6%

0.4%

0.2%

0.0%

1.4%

1.2%

Widely Held

Closely Held - Overlap

2009 2010 2011 2012 2013 2014

1.0%

0.8%

0.6%

0.4%

0.2%

0.0%

Closely Held - No Overlap
MANAGEMENT'S DISCUSSION AND ANALYSIS 43

Examination Survey, and communicate best practices 

to examination staff regarding information requests 

and use of the information received.

Consumer Complaints and Inquiries

The FDIC helps consumers by receiving, 

investigating, and responding to consumer complaints 

about FDIC-supervised institutions and answering 

inquiries about banking laws and regulations, FDIC 

operations, and other related topics. In addition, the 

FDIC provides analytical reports and information 

on complaint data for internal and external use, and 

conducts outreach activities to educate consumers. 

The FDIC recognizes that consumer complaints and 

inquiries play an important role in the development 

of strong public and supervisory policy. Assessing 

and resolving these matters helps the agency identify 

trends or problems affecting consumer rights, 

understand the public perception of consumer 

protection issues, formulate policy that aids 

consumers, and foster confidence in the banking 

system by educating consumers about the protection 

they receive under certain consumer protection laws 

and regulations.

Consumer Complaints by Product and Issue

The FDIC receives complaints and inquiries by 

telephone, fax, U.S. mail, email, and online through 

the FDIC’s website. In 2015, the FDIC handled 

18,118 written and telephone complaints and 

inquiries. Of this total, 9,042 related to FDICsupervised institutions. The FDIC responded 

to nearly 98 percent of these complaints within 

time frames established by corporate policy, and 

acknowledged 100 percent of all consumer complaints 

and inquiries within 14 days. As part of the 

complaint and inquiry handling process, the FDIC 

works with the other federal financial regulatory 

agencies to ensure that complaints and inquiries are 

forwarded to the appropriate agencies for response.

The FDIC carefully analyzes the products and issues 

involved in complaints about FDIC-supervised 

institutions. The number of complaints received 

about a specific bank product and issue can serve as a 

red flag to prompt further review of practices that may 

raise consumer protection or supervisory concerns. 

In 2015, the five most frequently identified consumer 

product complaints and inquiries about FDICsupervised institutions concerned credit cards (22 

percent), consumer loans (15 percent), checking 

accounts (13 percent), residential real estate loans (11 

percent), and prepaid cards (6 percent). Credit card 

complaints and inquiries most frequently described 

issues with billing disputes and error resolution, while 

the issues most commonly cited in correspondence 

about consumer loans were concerns with the 

reporting of erroneous information. Complaints and 

inquiries on checking accounts related to discrepancies 

or transaction errors on the account. The largest share 

of correspondence about residential real estate loans 

cited loan modifications and foreclosures as the main 

concern. Lastly, consumers most often identified 

issues with the release of funds in relation to prepaid 

cards.

The FDIC also investigated 89 complaints alleging 

discrimination during 2015. The number of 

discrimination complaints investigated has fluctuated 

over the past several years but averaged approximately 

117 complaints per year between 2008 and 2015. 

Over this period, nearly 37 percent of the complaints 

investigated alleged discrimination based on the race, 

color, national origin, or ethnicity of the applicant 

or borrower; 22 percent related to discrimination 

allegations based on age; 8 percent involved the sex 

of the borrower or applicant; and roughly 5 percent 

concerned marital status.

Consumer refunds generally involve the financial 

institution offering a voluntary credit to the 

consumer’s account, often as a direct result of 

complaint investigations and identification of a 

banking error or violation of law. In 2015, consumers 

received more than $636,792 in refunds from 

financial institutions as a result of the assistance 

provided by the FDIC’s Consumer Affairs Program.
44 FEDERAL DEPOSIT INSURANCE CORPORATION

Public Awareness of Deposit 

Insurance Coverage

An important part of the FDIC’s deposit insurance 

mission is to ensure that bankers and consumers have 

access to accurate information about the FDIC’s 

rules for deposit insurance coverage. The FDIC has 

an extensive deposit insurance education program 

consisting of seminars for bankers, electronic tools for 

estimating deposit insurance coverage, and written 

and electronic information targeted to both bankers 

and consumers. 

The FDIC continued its efforts to educate bankers 

and consumers about the rules and requirements 

for FDIC insurance coverage during 2015. For 

example, the FDIC conducted four telephone 

seminars for bankers on deposit insurance coverage, 

reaching an estimated 4,449 bankers participating 

at approximately 1,271 bank sites throughout the 

country. The FDIC also created deposit insurance 

training videos that are available on the FDIC’s 

website and YouTube channel.

During 2015, the FDIC received and answered 

approximately 90,429 telephone deposit insurancerelated inquiries from consumers and bankers. 

The FDIC Call Center addressed 38,662 of these 

inquiries, and deposit insurance coverage subjectmatter experts handled the other 51,767. In addition 

to telephone inquiries about deposit insurance 

coverage, the FDIC received 1,859 written inquiries 

from consumers and bankers. Of these inquiries, 

99 percent received responses within two weeks, as 

required by corporate policy.

Center for Financial Research

The FDIC’s Center for Financial Research (CFR) 

encourages and supports innovative research on topics 

that are important to the FDIC’s roles as deposit 

insurer and bank supervisor. Research from CFR 

staff was accepted during the year for publication in 

leading banking, finance, and economics journals, 

and was presented at banking and finance seminars at 

major conferences, regulatory institutions, and 

universities. CFR researchers also produced a number 

of new working papers in 2015. 

In addition, the CFR organized and sponsored the 

15th Annual Bank Research Conference jointly with 

the Journal for Financial Services Research. More 

than 120 participants attended the conference, which 

was held in September 2015 and included more than 

15 presentations on topics related to bank capital, 

liquidity, lending, dividend policy, systemic risk, and 

macroprudential regulation. 

RECEIVERSHIP MANAGEMENT

The FDIC has the unique mission of protecting 

depositors of insured banks and savings associations. 

No depositor has ever experienced a loss on the 

insured amount of his or her deposits in an FDICinsured institution due to a failure. Upon closure of 

an institution, typically by its chartering authority—

the state for state-chartered institutions and the OCC 

for national banks and federal savings associations—

the FDIC is appointed receiver and is responsible for 

resolving the failed institution.

The FDIC uses a variety of business practices to 

resolve a failed institution. These practices are 

typically associated with either the resolution process 

or the receivership process. Depending on the 

characteristics of the institution, the FDIC may 

recommend several of these methods to ensure the 

prompt and smooth payment of deposit insurance 

to insured depositors, to minimize the impact on the 

DIF, and to speed dividend payments to uninsured 

depositors and other creditors of the failed institution.

The resolution process involves evaluating and 

marketing a failing institution, soliciting and 

accepting bids for the sale of the institution, 

determining which bid is least costly to the DIF, and 

working with the acquiring institution through the 

closing process.

To minimize disruption to the local community, 

the resolution process must be performed as quickly 

and smoothly as possible. The FDIC uses two 

basic resolution methods: purchase and assumption 

transactions and deposit payoffs.
MANAGEMENT'S DISCUSSION AND ANALYSIS 45

The purchase and assumption (P&A) transaction is 

the most commonly used resolution method. In 

a P&A transaction, a healthy institution purchases 

certain assets and assumes certain liabilities of the 

failed institution. A variety of P&A transactions can 

be used. Since each failing bank situation is different, 

P&A transactions provide flexibility to structure 

deals that result in the highest value for the failed 

institution. For each possible P&A transaction, the 

acquirer may either acquire all or only the insured 

portion of the deposits. From 2008 through 2013, 

loss sharing was offered by the FDIC in connection 

with P&A transactions. In a loss-share transaction, 

the FDIC as receiver agrees to share losses on certain 

assets with the acquirer, absorbing a significant 

portion (typically 80 percent) of future losses on 

assets that have been designated as “shared-loss assets” 

for a specific period of time (five to ten years). The 

economic rationale for these transactions is that 

keeping assets in the banking sector can produce 

a better net recovery than the FDIC’s immediate 

liquidation of these assets. As the markets improve 

and function more normally with capital and liquidity 

returning, acquirers become more comfortable with 

bidding without the loss sharing protection. 

The FDIC continues to monitor compliance 

with shared-loss agreements by validating the 

appropriateness of loss-share claims; reviewing 

efforts to maximize recoveries; ensuring consistent 

application of policies and procedures across both 

shared-loss and legacy portfolios; and confirming that 

the acquirer has sufficient internal controls, including 

adequate staff, reporting, and recordkeeping systems. 

At year-end 2015, there were 215 receiverships with 

active shared-loss agreements with $31.5 billion in 

total covered assets.

Deposit payoffs are only executed if all bids received 

for a P&A transaction are more costly to the DIF than 

liquidation or if no bids are received, in which case 

the FDIC, in its corporate capacity, makes sure that 

the customers of the failed institution receive the full 

amount of their insured deposits. 

The receivership process involves performing 

the closing functions at the failed institution; 

liquidating any remaining failed institution assets; 

and distributing any proceeds of the liquidation to 

the FDIC, uninsured depositors, and other creditors 

of the receivership. In its role as receiver, the FDIC 

has used a wide variety of strategies and tools to 

manage and sell retained assets. These include asset 

sale and/or management agreements and structured 

transactions.

Financial Institution Failures

During 2015, eight institutions failed, including 

one large institution (greater than $5 billion in total 

assets), compared to 18 failures in 2014. The large 

failure in 2015 was unique because the majority of the 

institution’s assets and liabilities were sold to multiple 

buyers through an alliance partnership arrangement. 

The FDIC executed one P&A agreement with a 

lead buyer who then simultaneously sold portions of 

what they acquired to their alliance members. Asset 

buyers were also given an opportunity to bid on the 

institution’s assets prior to the institution failing. 

In all FDIC transactions, the FDIC successfully 

contacted all known qualified and interested bidders 

to market these institutions and also made insured 

funds available to all depositors within one business 

day of the failure. No losses were incurred on insured 

deposits, and no appropriated funds were required to 

pay insured deposits.

The following chart provides a comparison of failure 

activity over the past three years. 

FAILURE ACTIVITY 2013–2015

Dollars in Billions

2015 2014 2013

Total Institutions 8 18 24

Total Assets of 

Failed Institutions*

$6.7 $2.9 $6.0

Total Deposits of 

Failed Institutions*

$4.9 $2.7 $5.1

Estimated Loss to 

the DIF

$0.8 $0.4 $1.3

*Total assets and total deposits data are based on the last Call Report or 

Thrift Financial Report (TFR) filed by the institution prior to failure.
46 FEDERAL DEPOSIT INSURANCE CORPORATION

Asset Management and Sales

As part of its resolution process, the FDIC tries to sell 

as many assets as possible to an assuming institution. 

Assets that are retained by the receivership are 

evaluated. For 95 percent of the failed institutions, 

at least 90 percent of the book value of marketable 

assets is marketed for sale within 90 days of an 

institution’s failure for cash sales and within 120 days 

for structured sales.

Cash sales of assets for the year totaled $1.7 billion 

in book value. In addition to structured and cash 

sales, the FDIC also uses securitizations to dispose 

of bank assets. 

As a result of the FDIC’s marketing and collection 

efforts, the book value of assets in inventory decreased 

by $2.9 billion (37.4 percent) in 2015. The following 

chart shows the beginning and ending balances of 

these assets by asset type.

ASSETS IN INVENTORY 

BY ASSET TYPE

Dollars in Millions

Asset Type 12/31/15 12/31/14

Securities $393 $470

Consumer Loans 22 36

Commercial Loans 62 123

Real Estate Mortgages 173 697

Other Assets/Judgments 398 957

Owned Assets 113 120

Net Investments in Subsidiaries 122 123

Structured and Securitized Assets 3,524 5,150

Total $4,807 $7,676

Receivership Management Activities

The FDIC, as receiver, manages failed banks and their 

subsidiaries with the goal of expeditiously winding up 

their affairs. The oversight and prompt termination of 

receiverships help to preserve value for the uninsured 

depositors and other creditors by reducing overhead 

and other holding costs. Once the assets of a failed 

institution have been sold and the final distribution 

of any proceeds is made, the FDIC terminates the 

receivership. In 2015, the number of receiverships 

under management decreased by 7.3 percent, due to 

receiverships being terminated. The following chart 

shows overall receivership activity for the FDIC 

in 2015.

RECEIVERSHIP ACTIVITY

Active Receiverships as of 12/31/14 481

New Receiverships 8

Receiverships Terminated 43

Active Receiverships as of 12/31/15 446

Protecting Insured Depositors 

The FDIC’s ability to attract healthy institutions 

to assume deposits and purchase assets of failed 

banks and savings associations at the time of failure 

minimizes the disruption to customers and allows 

assets to be returned to the private sector immediately. 

Assets remaining after resolution are liquidated by 

the FDIC in an orderly manner, and the proceeds 

are used to pay creditors, including depositors whose 

accounts exceeded the insurance limit. During 2015, 

the FDIC paid dividends of $5.7 million to depositors 

whose accounts exceeded the insurance limit.

Professional Liability and 

Financial Crimes Recoveries

The FDIC works to identify potential claims against 

directors, officers, securities underwriters and 

issuers, fidelity bond insurance carriers, appraisers, 

attorneys, accountants, mortgage loan brokers, title 

insurance companies, and other professionals who 

may have caused losses to an IDI. Once a claim 

is determined to be meritorious and is expected 

to be cost-effective to pursue, the FDIC initiates 

legal action against the appropriate parties. During 

2015, the FDIC recovered $450.3 million from 

professional liability claims and settlements. The 

FDIC also authorized lawsuits related to two failed 

institutions against 26 individuals for director and 

officer liability, and authorized nine other lawsuits for 

fidelity bond, liability insurance, attorney malpractice, 
MANAGEMENT'S DISCUSSION AND ANALYSIS 47

appraiser malpractice, and securities law violations 

for residential mortgage-backed securities. As of 

December 31, 2015, the FDIC’s caseload included 

50 professional liability lawsuits (down from 102 at 

year-end 2014), 87 residential mortgage malpractice 

and fraud lawsuits (up from 75), and 264 open 

investigations (down from 511). The FDIC seeks 

to complete professional liability investigations and 

make decisions expeditiously on whether to pursue 

potential professional liability claims.  During 2015, 

it completed investigations and made decisions on 

over 80 percent of the investigations related to failures 

that reached the 18-month point after the institution’s 

failure date, exceeding its annual performance target.

As part of the sentencing process for those convicted 

of criminal wrongdoing against an 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 U.S. 

Department of Justice, collected $7.8 million from 

criminal restitution and forfeiture orders through 

the end of December 31, 2015. Also as of that 

same date, there were 3,831 active restitution and 

forfeiture orders (down from 3,954 at year-end 

2014). This includes 126 orders held by the Federal 

Savings and Loan Insurance Corporation (FSLIC) 

Resolution Fund, (i.e., orders arising out of failed 

financial institutions that were in receivership or 

conservatorship by the FSLIC or the Resolution Trust 

Corporation).

INTERNATIONAL OUTREACH 

In 2015, the FDIC continued to play a leading role 

in supporting and promoting the global development 

of effective deposit insurance, bank supervision, 

and resolution regimes as integral components of 

the financial safety net. The FDIC worked with 

several standard-setting, regulatory, supervisory, and 

multi-lateral organizations such as the Association 

of Supervisors of Banks of the Americas (ASBA), 

the BCBS, the Financial Services Volunteer Corps 

(FSVC), the Financial Stability Board (FSB), the 

International Association of Deposit Insurers (IADI), 

the International Monetary Fund (IMF), and the 

World Bank. FDIC staff also: facilitated training 

for several hundred participants from counterpart 

agencies around the world; participated in technical 

assistance missions to several countries; and conducted 

secondment programs to further the international 

community’s understanding and implementation of 

best practices in deposit insurance, bank supervision, 

and failure resolutions.

International Association of Deposit Insurers 

The IADI contributes to global financial stability by 

promoting international cooperation in the field of 

deposit insurance; providing guidance for establishing 

new, and enhancing existing, deposit insurance 

systems; and encouraging wide international contact 

among deposit insurers and other interested parties. 

IADI is now recognized as the standard-setting body 

for deposit insurance by major international financial 

institutions, including the FSB, the BCBS, the IMF, 

the World Bank, and the European Community. 

Since its founding in 2002, IADI has grown from 26 

members to 80 deposit insurers from 77 jurisdictions. 

FDIC Chairman Martin J. Gruenberg served as the 

President of IADI and Chair of its Executive Council 

from November 2007 to October 2012. In October 

2015, FDIC Vice Chairman Thomas M. Hoenig was 

elected to a two-year term to serve as President of 

IADI and Chair of its Executive Council. 

IADI and the BCBS jointly issued the Core Principles 

for Effective Deposit Insurance Systems in 2009 and 

completed the accompanying Compliance Assessment 

Methodology for the Core Principles in 2010 (together, 

the Core Principles). The FSB later included the Core 

Principles as part of its Compendium of Key Standards 

for Sound Financial Systems. During the fall of 2014, 

IADI’s Executive Council and the FSB approved a 

revised set of Core Principles that replaced the original 

(2009) version. 

Subsequently, an IADI drafting team, led by FDIC 

staff, began revising the Handbook for the Assessment 

of Compliance with the Core Principles (Handbook). 

The Handbook is being designed as a “how-to” guide, 

which will provide additional guidance on assessing a 

jurisdiction’s compliance with the Core Principles and 
48 FEDERAL DEPOSIT INSURANCE CORPORATION

will include lessons learned from collaboration with 

IMF and World Bank Financial Sector Assessment 

Program (FSAP) review teams, IADI Core Principles 

Regional Workshops, and IADI Self-Assessment 

Technical Assistance Program (SATAP) reviews. 

The IMF and World Bank use the Core Principles

in the context of the FSAP reviews, to assess the 

effectiveness of jurisdictions’ deposit insurance 

systems and practices. This represents an important 

milestone in the growing global acceptance of the role 

of effective deposit insurance systems in maintaining 

financial stability. IADI, under FDIC leadership 

of the Training and Conference Committee, has 

trained more than 300 staff members from over 

74 jurisdictions in conducting self-assessments for 

compliance with the Core Principles. In collaboration 

with the Deposit Insurance Fund of Kosovo, the 

FDIC led a Regional Workshop in Pristina, Kosovo, 

during May 2015 on Assessment of Compliance with 

the Revised Core Principles. In June 2015, the FDIC 

led a team of experts on an IADI SATAP review 

of the Korea Deposit Insurance Corporation in 

Seoul, Korea. 

FDIC executives and subject-matter experts partnered 

with IADI in helping to develop and deliver several 

international programs in 2015. In September 

2015, for example, Vice Chairman Thomas M. 

Hoenig joined global bank resolution and deposit 

insurance leaders at a conference hosted jointly by 

IADI and the Financial Stability Institute Conference. 

The conference, which was held at the Bank for 

International Settlements in Basel, Switzerland, 

explored key issues related to resolution and crisis 

management. The FDIC also led the organizing 

committee for IADI’s Biennial Research Conference 

held in June 2015, in Basel, Switzerland. Vice 

Chairman Hoenig presented at the conference, along 

with several FDIC subject-matter experts. Finally, 

in addition to the Vice Chairman’s new role as IADI 

President and Chair of its Executive Council, FDIC 

staff provides strategic guidance and leadership to 

multiple IADI standing committees, subcommittees, 

and working groups. 

Association of Supervisors of Banks 

of the Americas 

The FDIC has been a member of ASBA since its 

founding in 1999 and supports ASBA’s mission of 

promoting sound bank supervision and regulation 

throughout the Western Hemisphere. ASBA 

represents bank supervisors from 36 jurisdictions. 

The FDIC strives to lead the development of strong 

supervisory policies in this hemisphere through 

actively engaging with the Board, chairing ASBA’s 

Training and Technical Committee, and providing 

leadership in many of the Association’s research and 

guidance working groups. 

In 2015, senior FDIC staff chaired the ASBA Training 

and Technical Committee, which is responsible 

for designing and implementing ASBA’s training 

strategy that advances the adoption of sound bank 

supervision policies and practices among members. 

ASBA’s training program reaches more than 600 

members annually, with FDIC support, both as 

chair and training provider. In support of ASBA’s 

training program, the FDIC led a technical assistance 

training mission in Guatemala City, Guatemala, 

titled Banking Crisis and Resolutions in 2015. During 

the year, the FDIC also partnered with the U.S. 

Treasury Department and ASBA to promote stronger 

cooperation and information sharing between deposit 

insurers and bank supervisors in Latin America and 

the Caribbean. 

Basel Committee on Banking Supervision 

The FDIC supported the development of sound 

regulatory policy through effective participation in the 

BCBS and its relevant groups, subgroups, and task 

forces. Major work areas for the BCBS include those 

conducted by the:

• Policy Development Group (PDG) and its:

– Coherence and Calibration Task Force

– Working Group on Capital

– Trading Book Group

– Leverage Ratio Group
MANAGEMENT'S DISCUSSION AND ANALYSIS 49

– Working Group on Liquidity

– Risk Measurement Group

– Ratings and Securitization Work Stream

– Task Force on Standardized Approaches

– Task Force on Interest Rate Risk in the 

Banking Book

– Task Force on Scope of Regulatory Consolidation

– Research Task Force

– Quantitative Impact Study Working Group

• Supervision and Implementation Group and its:

– Working Group on Operational Risk

– Standards Implementation Group – 

Banking Book

– Standards Implementation Group – Trading Book

– Task Force on Supervisory Colleges

– Task Force on Pillar 2

• Macroprudential Supervision Group

• Accounting Experts Group and its:

– Audit Subgroup

• Anti-Money Laundering Expert Group

• Task Force on Simplicity and Comparability

• Task Force on Sovereign Exposures

• Working Group on Margining Requirements

• OTC Derivatives Regulators’ Forum

• OTC Derivatives Supervisor Group

• OTC Derivatives Assessment Team 

• Joint Central Counterparties Task Force

• Task Force on Securitization Markets

International Derivatives Work 

For many years, the FDIC has been actively engaged 

in cooperation with market, prudential, and financial 

stability authorities in policy development and 

regulatory activities in the derivatives markets. The 

FDIC also participates in the work of Derivatives 

Regulators’ Forum and the OTC Derivatives 

Supervisors Group.

International Capacity Building

The FDIC’s international efforts supporting the 

development of effective deposit insurance systems, 

bank supervisory practices, and bank resolution 

regimes continued to grow in 2015. FDIC staff 

contributed to international capacity building by 

providing study tours, secondments, and technical 

assistance to foreign counterparts. These engagements 

resulted in an enhanced dialogue between the FDIC 

and foreign counterparts in significant areas such as 

bank supervision and regulatory developments post 

crisis, the legal framework and operations for bank 

resolutions, and optimal funding strategies for 

deposit insurers.

FDIC management and staff hosted study tours 

for 214 people representing 31 jurisdictions during 

the year. In addition, the FDIC’s Corporate 

University provided training in bank supervision and 

information technology to 173 foreign delegates from 

20 jurisdictions. In 2015, the FDIC also launched a 

new training program for foreign regulatory officials, 

FDIC 101: An Introduction to Deposit Insurance, Bank 

Supervision, and Resolutions (FDIC 101), designed to 

provide a structured and comprehensive view of how 

the FDIC executes its key business functions. FDIC 

101 incorporates technical expertise from across the 

Corporation into a semi-annual, five-day intensive 

course. 

The FDIC contributes to global and domestic 

bank supervision, deposit insurance, and resolution 

initiatives by providing staff to support long-term 

projects and technical assistance missions led by the 

IMF, U.S. Treasury Department, the FSVC, and 

the World Bank. The FDIC also continued longestablished programs for staffing multiple details 

with the U.S. Treasury Department’s Office of 

International Banking and Securities Markets and 

with the FSVC to work on a variety of technical 

assistance programs. The FSVC’s long-term 

assignments included on-site project work on lending 

to small-to-medium-sized enterprises and anti-money 

laundering in Indonesia, Angola, Tanzania, Jordan, 

and Egypt. 
50 FEDERAL DEPOSIT INSURANCE CORPORATION

The FDIC also completed short-term technical 

assistance missions to Egypt to promote access 

to credit, and to Poland to assist with the deposit 

insurer’s organizational development. The FDIC 

partnered with the World Bank to provide technical 

assistance to the Nigeria Deposit Insurance 

Corporation and the Zimbabwe Deposit Protection 

Corporation on the development of quantitative 

models to estimate appropriate target fund ratios 

for their deposit insurance funds. The FDIC also 

partnered with the World Bank to provide technical 

assistance to Mexico’s bank supervisor, Comisión 

Nacional Bancaria y de Valores, on off-site risk-based 

supervision.

The FDIC expands and strengthens international 

engagement by providing secondment opportunities 

to foreign officials to engage in long-term consultation 

with FDIC subject-matter experts in areas related to 

bank supervision, deposit insurance, and resolutions. 

In 2015, two officials from the Deposit Insurance 

Corporation of Japan and the Korea Deposit 

Insurance Corporation concluded their secondments 

to the FDIC, and two new secondees from these 

agencies joined the FDIC, each for one-year 

assignments.

Key International Engagements

The FDIC continued to advance policy making 

priorities and strengthen its relationships with key 

jurisdictions worldwide through its participation in 

interagency dialogues in 2015. 

In January 2015, FDIC executives traveled to 

Beijing to participate in the 11th U.S.-China Joint 

Economic Committee Meeting to discuss with 

their Chinese counterparts issues related to deposit 

insurance and the U.S. bank resolution regime. 

FDIC representatives, alongside representatives 

from the other U.S. financial regulatory authorities, 

also participated in the annual U.S.-India Financial 

Regulatory Dialogue in January to discuss issues 

related to bank resolution and financial inclusion. In 

April 2015, representatives from the FDIC, FRB, and 

OCC met with delegates from the China Banking 

Regulatory Commission (CBRC) for the eighth 

annual CBRC-U.S. Supervisors’ Bilateral Conference 

to discuss supervisory issues of mutual interest. 

In May 2015, the FDIC joined other U.S., Canadian, 

and Mexican financial sector regulators in Ottawa for 

the 20th meeting of the North American Free Trade 

Agreement (NAFTA) Financial Services Committee 

(FSC). The participants discussed financial sector 

regulation, key policy issues, current cross-border 

financial sector issues, and recent developments 

in financial service regulations. The FDIC led the 

discussion on cross-border resolution, which included 

a discussion of resolution planning, resolution plans, 

and cross-border coordination efforts.

The 7th U.S.-China Strategic and Economic 

Dialogue was held in Washington D.C. in June 

2015. FDIC Chairman Martin J. Gruenberg 

participated, alongside other leaders from U.S. and 

Chinese government agencies, giving remarks during 

the session on financial sector reform. Chairman 

Gruenberg commended China on the adoption 

of a deposit insurance system and emphasized the 

importance of strong bilateral cooperation and robust 

resolution regimes for global financial stability.

MINORITY AND 

WOMEN INCLUSION

The FDIC relies on contractors to help meet its 

mission. In 2015, the FDIC awarded 346 (29.9 

percent) contracts to minority- and women-owned 

businesses (MWOBs) out of a total of 1,159 issued. 

The FDIC awarded contracts with a combined value 

of $858.4 million in 2015, of which, $211.6 million, 

or 24.7 percent, were awarded to MWOBs, compared 

to 34.9 percent for all of 2014. The FDIC paid 

$142.5 million of its total contract payments (28.1 

percent) to MWOBs, under 591 active contracts. 

Referrals to minority- and women-owned law firms 

(MWOLFs) accounted for 40 percent of all legal 

referrals in 2015, with total payments of $12 million 

going to MWOLFs, 12 percent of all payments to 

outside counsel, compared to 13 percent for all 

of 2014.
MANAGEMENT'S DISCUSSION AND ANALYSIS 51

In 2015, the FDIC participated in a combined total 

of 34 business expos, one-on-one matchmaking 

sessions, and panel presentations. At these events, 

FDIC staff provided information and responded to 

inquiries regarding FDIC business opportunities 

for minorities and women. In addition to targeting 

MWOBs and MWOLFs, these efforts also targeted 

veteran-owned and small disadvantaged businesses. 

Vendors were provided with the FDIC’s general 

contracting procedures, prime contractors’ contact 

information, and forecasts of possible upcoming 

solicitations. Also, vendors were encouraged to 

register through the FDIC’s Contractor Resource List 

(a principal database for vendors interested in doing 

business with the FDIC). 

In August 2015, the FDIC, along with seven other 

agencies, co-hosted “Collaborating for Success,” a 

technical assistance event, in conjunction with the 

Northern Virginia Procurement Technical Assistance 

Program (PTAP). The purpose of the event was to 

network with MWOBs that are interested in federal 

contracting activities, and to provide meaningful 

information to help them build and grow their federal 

contracting opportunities. This event supports one 

of the key provisions of Section 342 of the DoddFrank Act requiring the Office of Minority and 

Women Inclusion (OMWI) agencies to increase and 

ensure the fair participation of MWOBs, and ensure 

MWOBs receive technical assistance and guidance 

about the procurement process within those agencies. 

This was the first Interagency Procurement Technical 

Assistance Event, with joint participation of eight 

OMWI agencies. A total of 344 vendors attended. 

During 2015, OMWI and the Division of Resolutions 

and Receiverships (DRR) collaborated to present two 

FDIC-sponsored asset purchaser workshops that were 

marketed extensively to minority- and women-owned 

investors and companies interested in learning about 

DRR’s sales processes.  DRR speakers with strong 

backgrounds in their respective programs provided 

details on the various tools used by DRR to market 

assets and presented information to attendees on how 

to participate in the transactions and bid on assets 

offered for sale.

Following the Doral Bank failure in Puerto Rico 

in February 2015 and highlighting interdivisional 

collaboration, the Division of Depositor and 

Consumer Protection (DCP) joined with DRR and 

OMWI to sponsor workshops for both investors 

and homeowners. More than 160 people attended 

these events, which included presentations by: DRR, 

OMWI, and DCP staff; Puerto Rico’s Commissioner 

Blanco-Latorre from the Office of the Commissioner 

of Financial Institutions; and representatives from 

both the Department of Housing and Urban 

Development and the Commonwealth of Puerto Rico 

Housing Finance Authority.

Another asset purchaser workshop held in Atlanta, 

Georgia, was attended by 42 prospective investors. 

This event included a special focus on Owned Real 

Estate (ORE) investment opportunities to support 

a DRR auction of real estate properties scheduled 

two weeks after the outreach workshop. A segment 

regarding contracting services was also part of 

the event.

In August, through OMWI’s logistical support and 

funding, DRR participated in a Mortgage Housing 

Fair in Puerto Rico. The Housing Fair was organized 

by a small group of business professionals from the 

Representatives of the eight OMWI agencies gather at the first interagency OMWI technical assistance event.
52 FEDERAL DEPOSIT INSURANCE CORPORATION

banking and insurance community on the island, and 

drew an audience of over one thousand attendees. 

Representatives from DRR educated participants 

on the process of purchasing ORE properties from 

the FDIC, provided a general overview on deposit 

insurance, and publicized the scheduled ORE auction 

in October. The FDIC team also included members 

from RMS Examinations (Puerto Rico). Over the 

course of the event, the FDIC directly engaged over 

500 attendees, and indirectly informed many more 

through 30-minute presentations on the main stage 

each day. Presentations focused on deposit insurance 

and how to buy ORE from the FDIC. Information 

regarding the Minority and Women Outreach 

Program can be found on the FDIC’s website at 

www.fdic.gov/mwop.

In addition, the FDIC worked to further implement 

Section 342(b)(2)(C) of the Dodd-Frank Act in 

2015, which requires the OMWI Director of each 

covered agency to develop standards for assessing the 

diversity policies and practices of entities regulated 

by such agency. To implement that requirement and 

develop those standards, the FDIC continued to work 

closely with the OMWI Directors of the OCC, the 

NCUA, the FRB, the CFPB, and the SEC. On June 

10, 2015, the Final Interagency Policy Statement 

Establishing Joint Standards for Assessing the 

Diversity Policies and Practices of Entities Regulated 

by the Agencies became effective. 

EFFECTIVE MANAGEMENT OF 

STRATEGIC RESOURCES

The FDIC recognizes that it 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. Following are the FDIC’s 

major accomplishments in improving operational 

efficiency and effectiveness during 2015. 

Human Capital Management

The FDIC’s human capital management programs 

are designed to attract, train and develop, reward, 

and retain a highly skilled, diverse, and resultsoriented workforce. In 2015, the FDIC workforce 

planning initiatives emphasized the need to plan for 

employees to fulfill current and future capabilities 

and leadership needs. This focus ensures that the 

FDIC has a workforce positioned to meet today’s core 

responsibilities while preparing to fulfill its mission in 

the years ahead. 

Strategic Workforce Planning and Readiness

During 2015, the FDIC continued to develop and 

implement the Workforce Development Initiative, 

an integrated strategy to address workforce challenges 

and opportunities. The effort is focused on four 

broad objectives: (1) attract and develop talented 

employees across the agency; (2) enhance the 

capabilities of employees through training and diverse 

work experiences; (3) encourage employees to engage 

in active career development planning and seek 

leadership roles in the FDIC; and (4) build on and 

strengthen the FDIC’s operations to support these 

efforts. 

In 2015, the FDIC continued to develop the 

infrastructure, governance, programs, and processes 

to help meet its long-term workforce and leadership 

needs. The FDIC is committed to building and 

expanding its talent pipeline to ensure succession 

challenges are met. To that end, the agency 

conducted a cross-divisional succession planning 

review and talent strategy development process. 

Senior FDIC leaders convened to discuss emerging 

talent needs and strategies to address them, including 

efforts to develop the pipeline of the FDIC’s 

aspiring leadership pool. Several programs were 

launched in 2015 focused on enhancing leadership 

capabilities, including the Leadership Mentoring and 

Onboarding Programs, expanded external educational 

opportunities through Harvard’s Kennedy School of 

Government, and enriched management training. 
MANAGEMENT'S DISCUSSION AND ANALYSIS 53

The FDIC continued to focus on ensuring the 

availability of a workforce equipped to meet today’s 

responsibilities, while simultaneously preparing for 

future capability needs. The FDIC established a 

Career Paths initiative, targeted at nonsupervisory 

employees at all levels, to promote the acquisition of 

cross-organizational skills and knowledge. Additional 

support is provided to employees seeking professional 

development opportunities through expanded career 

management services. Following up on a pilot 

program launched in 2014, the FDIC evaluated 

its first-year experience with an effort to increase 

FDIC employees’ exposure to large bank operations 

across the agency. Based on initial feedback, the 

pilot program will be expanded to add six detail 

opportunities to the ten offered in 2014 to support 

the growth of the FDIC’s capabilities related to the 

oversight of SIFIs required under the Dodd-Frank 

Act.

The FDIC’s strategic workforce planning initiatives 

require a long-term and sustained focus to identify 

future workforce and leadership needs, assess current 

capabilities, support aspiration to management and 

leadership roles, and develop and source the talent 

to meet emerging workforce needs. Through further 

development of its human capital strategies, the FDIC 

will work to ensure that the future FDIC workforce is 

as prepared, capable, and dedicated as the one it has 

today.

Corporate Employee Program

The FDIC’s Corporate Employee Program (CEP) 

sponsors the development of newly hired Financial 

Institution Specialists (FISs) in entry-level positions. 

The CEP encompasses major FDIC divisions where 

FISs are trained to become part of a highly effective 

workforce. During the first-year rotation within the 

program, FISs gain experience and knowledge in the 

core business of the FDIC, including the Division 

of Depositor and Consumer Protection (DCP), the 

Division of Risk Management Supervision (RMS), 

the Division of Resolutions and Receiverships 

(DRR), and the Division of Insurance (DIR). At 

the conclusion of the rotation period, FISs are placed 

within RMS, DCP, or DRR, where they continue 

their career path to become commissioned examiners 

or resolutions and receiverships specialists.

The CEP, which celebrated its 10th anniversary in 

2015, is an essential part of the FDIC’s ability to 

provide continual cross-divisional staff mobility. 

Since the CEP’s inception in 2005, 1,516 individuals 

have joined the FDIC through this multi-discipline 

program and more than 700 have become 

commissioned examiners after successfully completing 

the program’s requirements.

The FDIC continues to sponsor the Financial 

Management Scholars Program (FMSP), an 

additional hiring source for the CEP. Participants in 

the FMSP complete an internship with the FDIC the 

summer following the conclusion of their junior year. 

As a result, the FDIC is able to recruit and hire highly 

talented and well-qualified students into the CEP 

ahead of other prospective employers. The program 

serves as an additional venue to recruit talent.

Employee Learning and Development

The FDIC is committed to the learning and 

development of its employees throughout their 

careers to enrich technical proficiency and leadership 

capacity, supporting career progression and succession 

management. In 2015, the FDIC focused on 

developing and implementing comprehensive 

curricula for its business lines to incorporate lessons 

learned from the financial crises and preparing 

employees to meet new challenges. Such training, 

which includes both classroom and online instruction 

for maximum flexibility, is a critical part of workforce 

and succession planning as more experienced 

employees become eligible for retirement.

The FDIC also offers a comprehensive leadership 

development program that combines core courses, 

electives, and other enrichment opportunities to 

develop employees at all levels. From new employees 

to new managers, the FDIC provides employees 

with targeted leadership development opportunities 

that align with key leadership competencies. In 

addition to a broad array of internally developed 
54 FEDERAL DEPOSIT INSURANCE CORPORATION

and administered courses, the FDIC also provides its 

employees with funds and/or time to participate in 

external training to support their career development. 

Corporate Risk Management

During 2015, the Office of Corporate Risk 

Management (OCRM) worked with divisions and 

offices to advance common agency-wide processes 

for identifying, managing, and mitigating risks to 

the FDIC. OCRM assisted the Enterprise Risk 

Committee, Executive Management Committee, 

External Risk Forum, and Management Risk 

Roundtable in reviewing risks across the agency. 

OCRM monitors material risks and mitigation 

activities, including the following:

• Risks to the agency’s ability to conduct its mission 

essential functions under all threats and conditions, 

as described in its Continuity of Operations Plan 

and Business Continuity Plan.

• Risks to the financial system posed by the extended 

current low level of interest rates.

• Risks posed by the analytical models used by the 

FDIC in identifying and managing risk. During 

2015, the FDIC enhanced policies and controls 

to govern internal decision support models. The 

comprehensive, corporate-wide model validation 

program will ensure that FDIC models are sound 

through routine testing and evaluation carried out 

according to tailored model validation programs.

• Risks associated with governance and development 

of large-scale IT projects.

• Risks posed to the agency and to the financial 

services industry by concerted attempts to penetrate, 

compromise, and disrupt the information systems 

that are essential to their effective operation. 

Employee Engagement

The FDIC continually evaluates its human capital 

programs and strategies to ensure that it remains an 

employer of choice and that all of its employees are 

fully engaged and aligned with the mission. The 

FDIC uses the Federal Employee Viewpoint Survey 

mandated by Congress to solicit information from 

employees and takes an agency-wide approach 

to address key issues identified in the survey. In 

December 2015, the FDIC received an award from 

the Partnership for Public Service for being ranked 

number one among mid-sized federal agencies on 

the Best Places to Work in the Federal Government® 

list. Effective leadership is the primary factor driving 

employee satisfaction and commitment in the federal 

workplace, according to a report by the Partnership 

for Public Service.  

The FDIC’s Workplace Excellence (WE) program 

plays an important role in helping the FDIC engage 

employees. The WE program is composed of a 

national-level WE Steering Committee and Division/

Office WE Councils that are focused on maintaining, 

enhancing, and institutionalizing a positive workplace 

environment throughout the agency. In addition 

to the WE program, the FDIC-National Treasury 

Employees Union Labor Management Forum serves 

as a mechanism for the union and employees to have 

pre-decisional input on workplace matters. The WE 

program and Labor Management Forum enhance 

communication, provide additional opportunities 

for employee input and engagement, and improve 

employee empowerment.

Photo credit: Aaron Clamage/Clamagephoto.com 

Director of the Division of Administration Arleas Upton Kea and 

Deputy to the Chairman and Chief Operating Officer Barbara 

A. Ryan accept the award from Max Stier, President and CEO of 

Partnership for Public Service.
MANAGEMENT'S DISCUSSION AND ANALYSIS 55

Information Technology Management

The FDIC recognizes that secure information 

technology (IT) solutions are a critical and 

transformative resource for the successful 

accomplishment of the agency’s business objectives. 

The FDIC relies on the efficient, innovative, and 

secure business capabilities that IT provides to ensure 

and enhance mission achievement. 

Information Technology – 

Innovative Mission Support

In 2015, the FDIC developed and implemented 

innovative software that enabled our examination 

stakeholders at the FDIC, FRB, and state banking 

agencies to better address current and future business 

challenges. The new Examination Tools Suite (ETS) 

provides the Corporation with cost and time savings 

in administration and deployment efforts; ETS 

also reduces maintenance expenses by centralizing 

functionality and reducing the overall number of 

systems supporting the program. ETS introduces 

wireless on-site networks that enhance the security 

and accuracy of shared examination data while 

reducing data redundancy. ETS addresses the risk 

of technological obsolescence by using technology 

consistent with the FDIC’s current Enterprise 

Architecture standards and industry best practices. 

The Claims Administration System (CAS) is a system 

that FDIC personnel use to identify depositors’ 

insured and uninsured funds in failing and failed 

financial institutions. For every failing institution, 

CAS is used before the failure to estimate the amount 

of uninsured deposits for the least-cost test. When 

an insured deposit transaction is the least-cost 

resolution, CAS is used to determine the amount of 

the depositors’ funds that are insured and that can 

be transferred to the acquiring institution or paid 

out directly to the depositor. For all failures, CAS 

is the system of record for the deposits of the failed 

institution. During 2015, the FDIC enhanced CAS 

capabilities in order to “future-proof” the FDIC’s 

ability to efficiently and effectively manage the 

increased data requirements for SIFIs that the agency 

may need to address during the resolution process as 

required by Dodd-Frank Act regulations.

During 2015, the FDIC strengthened access 

controls of one of its primary systems for exchanging 

information with financial institutions, examiners, 

and other regulators by implementing MultiFactor Authentication (MFA). MFA is a method 

to authenticate users by requiring the presentation 

of two or all of the three following authentication 

factors: (1) a knowledge factor (something the user 

knows, such as a password); (2) a possession factor 

(something the user has, such as a token); or (3) an 

inherence factor (something the user is, such as a 

fingerprint). To improve remote access security for 

these FDIC customers, approximately 18,000 external 

users were provided MFA technology during the year.

Keeping the FDIC Secure –

Cybersecurity (Internal) 

Like all citizens in our increasingly connected world, 

the FDIC continues to face serious, wide-ranging 

threats to our operations, data, and reputation. 

During 2015, the FDIC continued to improve and 

evolve a strong and proactive IT security program to 

effectively mitigate these risks in our cybersecurity 

landscape. 

Phishing and other email scams continue to rise at a 

steady rate. The FDIC will likely see continued and 

heightened levels of malicious attacks through email. 

To strengthen email-related cybersecurity, the FDIC 

implemented improved data loss prevention controls 

and products that protect not only the FDIC’s 

reputation and data assets but also provide protection 

to the public by helping to ensure only the legitimate 

use of FDIC credentials. 

Finally, the FDIC enhanced its capabilities for 

quantifying risks posed by IT-related cybersecurity 

events. To provide management with up-to-date 

metrics and reporting mechanisms for monitoring 

their risk and the remediation of that risk, the FDIC 
56 FEDERAL DEPOSIT INSURANCE CORPORATION

implemented changes to its monitoring system to 

display the numeric Common Vulnerability Scoring 

System2 (CVSS) scores for all open findings. These 

scores provide management with a clear numerical 

representation of their finding’s risk level so that they 

can better prioritize agency resources for remediating 

those risks.

2

 The CVSS provides an open framework for communicating the characteristics and impacts of IT vulnerabilities.
II. PERFORMANCE RESULTS 

SUMMARY

57

II.

Performance 

Results 

Summary
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PERFORMANCE RESULTS SUMMARY 59

SUMMARY OF 2015 PERFORMANCE RESULTS BY PROGRAM

The FDIC successfully achieved 39 of the 40 annual 

performance targets established in its 2015 Annual 

Performance Plan. One target was not achieved: the 

issuance of a Notice of Proposed Rulemaking (NPR) 

on the implementation of the Net Stable Funding 

Ratio, which continues to be developed on an 

interagency basis. There were no instances in which 

2015 performance had a material adverse effect on 

the successful achievement of the FDIC’s mission or 

its strategic goals and objectives regarding its major 

program responsibilities.

Additional key accomplishments are noted below.

Program Area Performance Results

Insurance • Updated the FDIC Board of Directors on loss, income, and reserve ratio 

projections for the Deposit Insurance Fund (DIF) at the April and October 

meetings. 

• Briefed the FDIC Board of Directors in April and October on progress in meeting 

the goals of the Restoration Plan. Based upon current fund projections, no changes 

to assessment rate schedules were necessary.

• Presented an NPR to the FDIC Board of Directors in June that would refine the 

deposit insurance assessment system for established small banks to incorporate 

newer data from the recent financial crisis and revise the methodology to directly 

estimate the probability of failure within three years.

• Presented an NPR to the FDIC Board of Directors in October that would 

implement provisions of the Dodd-Frank Act to raise the minimum reserve ratio 

of the DIF to 1.35 percent by September 30, 2020, and offset the effect of the 

increase in the minimum reserve ratio from 1.15 percent to 1.35 percent on IDIs 

with total consolidated assets of less than $10 billion.

• Completed reviews of the recent accuracy of the contingent loss reserves. 

• Researched and analyzed emerging risks and trends in the banking sector, financial 

markets, and the overall economy to identify issues affecting the banking industry 

and the DIF. 

• Provided policy research and analysis to FDIC leadership in support of the 

implementation of financial industry regulation, as well as support for testimony 

and speeches. 

• Published economic and banking information and analyses through the FDIC

Quarterly, FDIC Quarterly Banking Profile (QBP), FDIC State Profiles, and the 

Center for Financial Research Working Papers.

• Operated the Electronic Deposit Insurance Estimator (EDIE), which had 336,703 

user sessions in 2015. 
60 FEDERAL DEPOSIT INSURANCE CORPORATION

Program Area Performance Results

Supervision and 

Consumer Protection

• A total of 521 institutions were assigned a composite CAMELS rating of 2 and 

had Matters Requiring Board Attention (MRBAs) identified in the examination 

reports. To ensure that MRBAs are being appropriately addressed at these 

institutions, the FDIC timely reviews progress reports and follows up with bank 

management as needed. More specifically, within six months of issuing the 

examination reports, the FDIC conducted appropriate follow up and review of 

these MRBAs at 501 (96.2 percent) of these institutions. Follow up and review of 

the MRBAs at the remaining 20 institutions (3.8 percent) occurred more than six 

months after issuing the examination reports primarily due to delayed responses 

from some banks as well as the need for additional information in order to 

complete a full review. 

• Participated on the examinations of selected financial institutions, for which the 

FDIC is not the primary federal regulator, to assess risk to the DIF. 

• Implemented the strategy outlined in the work plan approved by the Advisory 

Committee on Economic Inclusion to support the expanded availability of 

Safe accounts and the responsible use of technology, to expand banking services to 

the underbanked.

• Published an edition of Supervisory Insights that included information on strategic 

planning in an evolving earnings environment, new requirements related to 

investments in securitizations as a result of the Dodd-Frank Act, and recently 

released regulations and supervisory guidance.

Receivership Management • Terminated at least 75 percent of new receiverships that are not subject to lossshare agreements, structured sales, or other legal impediments, within three years of 

the date of failure.
PERFORMANCE RESULTS SUMMARY 61

PERFORMANCE RESULTS BY PROGRAM AND STRATEGIC GOAL

2015 INSURANCE PROGRAM RESULTS

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

# ANNUAL 

PERFORMANCE GOAL INDICATOR TARGET RESULTS

1 Respond promptly to all 

insured financial institution 

closings and related emerging 

issues.

Number of business days 

after an institution failure 

that depositors have access 

to insured funds.

Insured depositor losses 

resulting from a financial 

institution failure.

Depositors have access to insured funds 

within one business day if the failure 

occurs on a Friday.

Depositors have access to insured funds 

within two business days if the failure 

occurs on any other day of the week.

Depositors do not incur any losses on 

insured deposits.

No appropriated funds are required to pay 

insured depositors.

ACHIEVED.

SEE PG. 45. 

ACHIEVED.

SEE PG. 45.

ACHIEVED.

SEE PG. 45.

ACHIEVED.

SEE PG. 45.

2 Disseminate data and analyses 

on issues and risks affecting the 

financial services industry to 

bankers, supervisors, the public, 

and other stakeholders on an 

ongoing basis.

Scope and timeliness of 

information dissemination 

on identified or potential 

issues and risks.

Disseminate results of research and 

analyses in a timely manner through 

regular publications, ad hoc reports, and 

other means.

Undertake industry outreach activities to 

inform bankers and other stakeholders 

about current trends, concerns, and other 

available FDIC resources.

ACHIEVED. 

SEE PGS. 59-60.

ACHIEVED.

SEE PGS. 39-40, 

47-52.

3 Adjust assessment rates, as 

necessary, to achieve a DIF 

reserve ratio of at least 1.35 

percent of estimated insured 

deposits by September 30, 

2020.

Updated fund balance 

projections and 

recommended changes to 

assessment rates.

Demonstrated progress in 

achieving the goals of the 

Restoration Plan.

Provide updated fund balance projections 

to the FDIC Board of Directors by June 

30, 2015, and December 31, 2015.

Recommend changes to deposit insurance 

assessment rates to the FDIC Board of 

Directors as necessary.

Provide progress reports to the FDIC 

Board of Directors by June 30, 2015, and 

December 31, 2015.

ACHIEVED.

SEE PG. 59.

ACHIEVED.

SEE PG. 59.

ACHIEVED.

SEE PG. 59.
62 FEDERAL DEPOSIT INSURANCE CORPORATION

2015 INSURANCE PROGRAM RESULTS (continued)

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

# ANNUAL 

PERFORMANCE GOAL INDICATOR TARGET RESULTS

4 Expand and strengthen the 

FDIC’s participation and 

leadership role in supporting 

robust and effective deposit 

insurance programs, resolution 

strategies, and banking systems 

worldwide. 

Activities to expand and 

strengthen engagement 

with foreign jurisdictions 

and advance the FDIC’s 

global leadership and 

participation.

Provision of technical 

assistance to foreign 

counterparts.

Maintain open dialogue with counterparts 

in strategically important jurisdictions, 

international financial organizations and 

institutions, and partner U.S. agencies; 

and actively participate in bilateral 

interagency regulatory dialogues.

Maintain a leadership position in the 

International Association of Deposit 

Insurers (IADI) by conducting 

workshops and performing assessments 

of deposit insurance systems based on 

the methodology for assessment of 

compliance with the IADI Core Principles 

for Effective Deposit Insurance Systems (Core 

Principles), developing and conducting 

training on priority topics identified by 

IADI members, and actively participating 

in IADI’s Executive Council and Standing 

Committees.

Maintain open dialogue with the 

Association of Supervisors of Banks of the 

Americas (ASBA) to develop and foster 

relationships with bank supervisors in 

the region by providing assistance when 

necessary.

Engage with authorities responsible for 

resolutions and resolutions planning 

in priority foreign jurisdictions and 

contribute to the resolution-related 

agenda of the Financial Stability Board 

(FSB) through active participation in the 

FSB’s Resolution Steering Group (ReSG).

Support visits, study tours, secondments, 

and longer-term technical assistance and 

training programs for representatives for 

foreign jurisdictions to strengthen their 

deposit insurance organizations, central 

banks, bank supervisors, and resolution 

authorities. 

ACHIEVED.

SEE PGS. 49-50.

ACHIEVED.

SEE PGS. 47-48.

ACHIEVED. 

SEE PG. 48.

ACHIEVED.

SEE PG. 47.

ACHIEVED.

SEE PGS. 49-50.
PERFORMANCE RESULTS SUMMARY 63

2015 INSURANCE PROGRAM RESULTS (continued)

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

# ANNUAL 

PERFORMANCE GOAL INDICATOR TARGET RESULTS

5 Market failing institutions to all 

known qualified and interested 

potential bidders.

Scope of qualified 

and interested bidders 

solicited.

Contact all known qualified and 

interested bidders. 

ACHIEVED. 

SEE PG. 45.

6 Provide educational 

information to insured 

depository institutions and 

their customers to help them 

understand the rules for 

determining the amount of 

insurance coverage on deposit 

accounts.

Timeliness of responses to 

deposit insurance coverage 

inquiries.

Initiatives to increase 

public awareness of 

deposit insurance coverage 

changes.

Respond within two weeks to 95 percent 

of written inquiries from consumers and 

bankers about FDIC deposit insurance 

coverage.

Conduct at least 4 telephone or in-person 

seminars for bankers on deposit insurance 

coverage.

Complete and post on the FDIC website 

videos for bankers and consumers on 

deposit insurance coverage.

ACHIEVED.

 SEE PG. 44.

ACHIEVED.

SEE PG. 44.

ACHIEVED.

SEE PG. 44.
64 FEDERAL DEPOSIT INSURANCE CORPORATION

2015 SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS

Strategic Goal: FDIC-insured institutions are safe and sound. 

# ANNUAL 

PERFORMANCE GOAL INDICATOR TARGET RESULTS

1 Conduct on-site risk 

management examinations 

to assess the overall financial 

condition, management 

practices and policies, and 

compliance with applicable 

laws and regulations of 

FDIC-supervised depository 

institutions. When problems 

are identified, promptly 

implement appropriate 

corrective programs, and follow 

up to ensure that identified 

problems are corrected.

Percentage of required 

examinations conducted in 

accordance with statutory 

requirements and FDIC 

policy.

Follow-up actions on 

identified problems.

Conduct all required risk management 

examinations within the time frames 

prescribed by statute and FDIC policy.

For at least 90 percent of institutions that 

are assigned a composite CAMELS rating 

of 2 and for which the examination 

report identifies “Matters Requiring 

Board Attention” (MRBAs), review 

progress reports and follow up with 

the institution within six months of 

the issuance of the examination report 

to ensure that all MRBAs are being 

addressed.

ACHIEVED.

SEE PGS. 26-27.

ACHIEVED.

SEE PG. 60. 

2 Assist in protecting the 

infrastructure of the U.S. 

banking system against terrorist 

financing, money laundering, 

and other financial crimes.

Percentage of required 

examinations conducted in 

accordance with statutory 

requirements and FDIC 

policy. 

Conduct all Bank Secrecy Act 

examinations within the time frames 

prescribed by statute and FDIC policy.

ACHIEVED.

SEE PGS. 26-27.

3 More closely align regulatory 

capital standards with risk 

and ensure that capital is 

maintained at prudential levels.

U.S. implementation of 

internationally agreed 

regulatory standards.

Publish by December 31, 2015, 

an interagency Notice of Proposed 

Rulemaking on implementation of the 

Basel III Net Stable Funding Ratio.

 NOT ACHIEVED.

SEE PG. 18.

4 Implement strategies to 

promote enhanced information 

security, cybersecurity, and 

business continuity within the 

banking industry.

Enhancements to IT 

supervision program.

Enhance the technical expertise of the IT 

supervisory workforce.

Working with FFIEC counterparts, 

update and strengthen IT guidance to the 

industry on cybersecurity preparedness.

Working with the FFIEC counterparts, 

update and strengthen IT examination 

work programs for institutions and 

technology service providers (TSPs) to 

evaluate cybersecurity preparedness and 

cyber resiliency.

Improve information sharing on 

identified technology risks among the 

IT examination workforces of FFIEC 

member agencies.

ACHIEVED. 

SEE PGS. 29-30.

ACHIEVED.

SEE PG. 30. 

ACHIEVED.

SEE PG. 30.

ACHIEVED.

SEE PG. 30.
PERFORMANCE RESULTS SUMMARY 65

2015 SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS (continued)

Strategic Goal: Consumers’ rights are protected and FDIC-supervised 

institutions invest in their communities.

# ANNUAL 

PERFORMANCE GOAL INDICATOR TARGET RESULTS

1 Conduct on-site CRA 

and consumer compliance 

examinations to assess 

compliance with applicable 

laws and regulations by 

FDIC-supervised depository 

institutions. When violations 

are identified, promptly 

implement appropriate 

corrective programs and follow 

up to ensure that identified 

problems are corrected.

Percentage of examinations 

conducted in accordance 

with the time frames 

prescribed by FDIC 

policy.

Implementation of 

corrective programs.

Conduct all required examinations within 

the time frames established by FDIC 

policy.

Conduct visits and/or followup examinations in accordance 

with established FDIC policies to 

ensure that the requirements of any 

required corrective program have 

been implemented and are effectively 

addressing identified violations.

ACHIEVED.

SEE PG. 27. 

ACHIEVED.

SEE PGS. 26-28. 

2 Effectively investigate and 

respond to written consumer 

complaints and inquiries about 

FDIC-supervised financial 

institutions.

Timely responses to 

written consumer 

complaints and inquiries.

Respond to 95 percent of written 

consumer complaints and inquiries within 

time frames established by policy, with all 

complaints and inquiries receiving at least 

an initial acknowledgement within two 

weeks.

ACHIEVED.

SEE PG. 43.

3 Promote economic inclusion 

and access to responsible 

financial services through 

supervisory, research, policy, 

and consumer/community 

affairs initiatives.

Completion of planned 

initiatives.

Revise, test, and administer the 2015 

FDIC National Survey of Unbanked and 

Underbanked Households.

Support the Advisory Committee on 

Economic Inclusion in expanding the 

availability and awareness of low-cost 

transaction accounts, consistent with the 

FDIC’s SAFE account template. 

In partnership with the Consumer 

Financial Protection Bureau, enhance 

financial capability among school-age 

children through (1) development and 

delivery of tailored financial education 

materials; (2) resources and outreach 

targeted to youth, parents, and teachers; 

and (3) implementation of a pilot youth 

savings program. 

ACHIEVED.

SEE PGS. 36-37.

ACHIEVED.

SEE PG. 36.

ACHIEVED.

SEE PGS. 38-39.
66 FEDERAL DEPOSIT INSURANCE CORPORATION

2015 SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS (continued)

Strategic Goal: Large and complex financial institutions are resolvable 

in an orderly manner under bankruptcy.

# Annual 

Performance Goal INDICATOR TARGET RESULTS

1 Identify and address risks 

in large, complex financial 

institutions.

Risk monitoring of 

large, complex financial 

institutions, bank holding 

companies and designated 

nonbanking firms.

Completion of 

statutory and regulatory 

requirements under Title I 

of DFA.

Conduct ongoing risk analysis and 

monitoring of large, complex financial 

institutions to understand and assess their 

structure, business activities, risk profiles, 

and resolution and recovery plans.

Complete, in collaboration with the 

FRB and in accordance with statutory 

and regulatory time frames, a review of 

resolution plans submitted by individual 

financial companies subject to the 

requirements of section 165 (d) of DFA 

and Part 360.10 of the FDIC Rules and 

Regulations.

ACHIEVED.

SEE PGS. 21-24.

ACHIEVED.

SEE PGS. 22-23.
PERFORMANCE RESULTS SUMMARY 67

2015 RECEIVERSHIP MANAGEMENT 

PROGRAM RESULTS

Strategic Goal: Resolutions are orderly and receiverships are managed effectively.

# Annual 

Performance Goal INDICATOR TARGET RESULTS

1 Value, manage, and market 

assets of failed institutions and 

their subsidiaries in a timely 

manner to maximize net return.

Percentage of the assets 

marketed for each failed 

institution.

For at least 95 percent of insured 

institution failures, market at least 

90 percent of the book value of the 

institution’s marketable assets within 90 

days of the failure date (for cash sales) or 

120 days of failure date (for structured 

sales).

ACHIEVED.

SEE PGS. 45-46.

2 Manage the receivership estate 

and its subsidiaries toward an 

orderly termination.

Timely termination of new 

receiverships.

Terminate at least 75 percent of new 

receiverships that are not subject to 

loss-share agreements, structured sales, 

or other legal impediments, within three 

years of the date of failure.

ACHIEVED.

SEE PG. 60.

3 Conduct investigations into all 

potential professional liability 

claim areas for all failed insured 

depository institutions, and 

decide as promptly as possible, 

to close or pursue each claim, 

considering the size and 

complexity of the institution.

Percentage of investigated 

claim areas for which a 

decision has been made to 

close or pursue the claim.

For 80 percent of all claim areas, make a 

decision to close or pursue professional 

liability claims within 18 months of 

the failure of an insured depository 

institution.

ACHIEVED.

SEE PG. 47.

4 Ensure the FDIC’s operational 

readiness to resolve a large, 

complex financial institution 

using the orderly liquidation 

authority in Title II of the 

DFA.

Establishment of 

resolution plans and 

strategies.

Meetings of the Systemic 

Resolution Advisory 

Committee (SRAC).

Enhanced cross-border 

coordination and 

cooperation in resolution 

planning.

Update and refine firm-specific 

resolutions plans and strategies and 

develop operational procedures for the 

administration of a Title II receivership.

Prepare for an early 2016 meeting of the 

Systemic Resolution Advisory Committee 

to obtain feedback on resolving SIFIs.

Continue to deepen and strengthen 

bilateral working relationships with key 

foreign jurisdictions. 

ACHIEVED.

SEE PG. 24.

ACHIEVED.

SEE PG. 25.

ACHIEVED.

SEE PGS. 24-25.
68 FEDERAL DEPOSIT INSURANCE CORPORATION

INSURANCE PROGRAM RESULTS

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

Annual Performance Goals and Targets 2014 2013 2012

1. Respond promptly to all financial institution closings and related 

emerging issues.

• Depositors have access to insured funds within one 

business day if the failure occurs on a Friday. ACHIEVED. ACHIEVED. ACHIEVED.

• Depositors have access to insured funds within two business days if the 

failure occurs on any other day of the week. ACHIEVED. ACHIEVED. ACHIEVED.

• Depositors do not incur any losses on insured deposits. ACHIEVED. ACHIEVED. ACHIEVED.

• No appropriated funds are required to pay insured depositors. ACHIEVED. ACHIEVED. ACHIEVED.

2. Deepen the FDIC’s understanding of the future of 

community banking.

• Conduct a nationwide conference on the future of 

community banking during the first quarter of 2012. ACHIEVED.

• Publish by December 31, 2012, a research study on the future of 

community banks, focusing on their evolution, characteristics, 

performance, challenges, and role in supporting local communities.

ACHIEVED.

3. Disseminate data and analyses on issues and risks affecting the 

financial services industry to bankers, supervisors, the public, and 

other stakeholders on an ongoing basis.

• Disseminate results of research and analyses in a timely manner through 

regular publications, ad hoc reports, and other means. ACHIEVED. ACHIEVED. ACHIEVED.

• Undertake industry outreach activities to inform bankers and other 

stakeholders about current trends, concerns, and other available FDIC 

resources.

ACHIEVED. ACHIEVED. ACHIEVED.

4. Adjust assessment rates, as necessary, to achieve a DIF reserve 

ratio of at least 1.35 percent of estimated insured deposits by 

September 30, 2020.

• Provide updated fund balance projections to the FDIC Board of 

Directors by June 30, 2014, and December 31, 2014. ACHIEVED.

• Provide updated fund balance projections to the FDIC Board of 

Directors by June 30, 2013, and December 31, 2013. ACHIEVED.

• Provide updated fund balance projections to the FDIC Board of 

Directors by June 30, 2012, and December 31, 2012. ACHIEVED.

PRIOR YEARS’ PERFORMANCE RESULTS

Refer to the respective full Annual Report of prior years, located on FDIC’s website for more information on 

performance results for those years. Minor wording changes may have been made to reflect current goals and 

targets. (Shaded areas indicate no such target existed for that respective year.)
PERFORMANCE RESULTS SUMMARY 69

INSURANCE PROGRAM RESULTS (continued)

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

Annual Performance Goals and Targets 2014 2013 2012

• Provide progress reports to the FDIC Board of Directors by June 30, 

2014, and December 31, 2014. ACHIEVED.

• Provide progress reports to the FDIC Board of Directors by June 30, 

2013, and December 31, 2013. ACHIEVED.

• Provide progress reports to the FDIC Board of Directors by June 30, 

2012, and December 31, 2012. ACHIEVED.

• Recommend changes to deposit insurance assessment rates to the FDIC 

Board of Directors as necessary. ACHIEVED. ACHIEVED. ACHIEVED.

• Provide to the Chairman by September 1, 2012, an analysis, with 

recommendations where appropriate, of refinements to the deposit 

insurance pricing methodology for banks with assets under $10 billion.

ACHIEVED.

5. Provide educational information to insured depository institutions 

and their customers to help them understand the rules for 

determining the amount of insurance coverage on deposit accounts.

• Respond within two weeks to 95 percent of written inquiries from 

consumers and bankers about FDIC deposit insurance coverage. ACHIEVED. ACHIEVED. ACHIEVED.

• Conduct at least 15 telephone or in-person seminars for bankers on 

deposit insurance coverage. ACHIEVED.

• Conduct at least 12 telephone or in-person seminars for bankers on 

deposit insurance coverage. ACHIEVED. ACHIEVED.

6. Expand and strengthen the FDIC’s participation and leadership 

role in supporting robust international deposit insurance and 

banking systems. 

• Maintain open dialogue with counterparts in strategically important 

countries as well as international financial institutions and partner U.S. 

agencies.

ACHIEVED. ACHIEVED.

• Conduct workshops and assessments of deposit insurance systems 

based on the methodology for assessment of compliance with the 

Basel Committee on Bank Supervision (BCBS) and the International 

Association of Depositor Insurers (IADI) Core Principles for Effective 

Deposit Insurance Systems.

ACHIEVED.

• Support visits, study tours, and longer-term technical assistance and 

training programs for foreign jurisdictions to strengthen their deposit 

insurance organizations, central banks, and bank supervisors.

ACHIEVED.

• Support visits, study tours, and longer-term technical assistance and 

training programs for foreign jurisdictions to strengthen their deposit 

insurance organizations, central banks, bank supervisors, and resolution 

authorities.

ACHIEVED.

• Foster strong relationships with international banking regulators and 

associations that promote sound banking supervision and regulation, 

failure resolutions, and deposit insurance practices.

ACHIEVED. 
70 FEDERAL DEPOSIT INSURANCE CORPORATION

INSURANCE PROGRAM RESULTS (continued)

Strategic Goal: Insured depositors are protected from loss without recourse to taxpayer funding.

Annual Performance Goals and Targets 2014 2013 2012

• Target capacity building based on the assessment methodology of the 

BCBS and IADI Core Principles for an Effective Deposit Insurance System. ACHIEVED. 

• Lead and support the Association of Supervisors of Banks of the 

Americas’ efforts to promote sound banking principles throughout the 

Western Hemisphere.

ACHIEVED.

7. Expand and strengthen the FDIC’s participation and leadership role 

in supporting robust and effective deposit insurance programs, 

resolution strategies, and banking systems worldwide.

• Maintain open dialogue with counterparts in strategically important 

countries as well as international financial institutions and partner U.S. 

agencies.

ACHIEVED.

• Maintain a leadership position in the International Association of 

Deposit Insurers (IADI) by conducting workshops and performing 

assessments of deposit insurance systems based on the methodology for 

assessment of compliance with the IADI Core Principles for Effective 

Deposit Insurance Systems (Core Principals), developing and conducting 

training on priority topics identified by IADI members, and actively 

participating in IADI’s Executive Council and Standing Committees. 

ACHIEVED.

• Support visits, study tours, and longer-term technical assistance and 

training programs for foreign jurisdictions to strengthen their deposit 

insurance organizations, central banks, bank supervisors, and resolution 

authorities. 

ACHIEVED.

• Engage with authorities responsible for resolutions and resolutions 

planning in priority foreign jurisdictions. ACHIEVED.

• Contribute to the resolution-related agenda of the Financial Stability 

Board (FSB) through active participation in the FSB’s Resolution 

Steering Group and its working groups. 

ACHIEVED.

• Actively participate in bilateral interagency regulatory dialogues. ACHIEVED.
PERFORMANCE RESULTS SUMMARY 71

SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS

Strategic Goal: FDIC-supervised institutions are safe and sound.

Annual Performance Goals and Targets 2014 2013 2012

1. Conduct on-site risk management examinations to assess the 

overall financial condition, management practices and policies, and 

compliance with applicable laws and regulations of FDIC-supervised 

depository institutions. 

• Conduct all required risk management examinations within the time 

frames prescribed by statute and FDIC policy. ACHIEVED.

2. Conduct on-site risk management examinations to assess the 

overall financial condition, management practices and policies, and 

compliance with applicable laws and regulations of FDIC-supervised 

depository institutions. When problems are identified, promptly 

implement appropriate corrective programs, and follow up to 

ensure that identified problems are corrected. 

• Conduct all required risk management examinations within the time 

frames prescribed by statute and FDIC policy. ACHIEVED. ACHIEVED.

• Implement formal or informal enforcement actions within 60 days for 

at least 90 percent of all institutions that are newly downgraded to a 

composite Uniform Financial Institutions Rating of 3, 4, or 5.

SUBSTANTIALLY 

ACHIEVED.

SUBSTANTIALLY 

ACHIEVED.3

3. For all institutions that are assigned a composite Uniform Financial 

Institutions Rating of 3, 4, or 5, conduct on-site visits within six 

months after implementation of a corrective program. Ensure 

during these visits and subsequent examinations that the institution 

is fulfilling the requirements of the corrective program that has 

been implemented and that the actions taken are effectively 

addressing the underlying concerns identified during the 

examination.

• Conduct 100 percent of required on-site visits within six months after 

implementation of a corrective program. ACHIEVED.

4. Assist in protecting the infrastructure of the U.S. banking system 

against terrorist financing, money laundering, and other financial 

crimes.

• Conduct all Bank Secrecy Act examinations within the time frames 

prescribed by statute and FDIC policy. ACHIEVED. ACHIEVED. ACHIEVED.

 3 Erroneously reported as “Achieved” in the 2013 Annual Report.
72 FEDERAL DEPOSIT INSURANCE CORPORATION

SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS (continued)

Strategic Goal: FDIC-supervised institutions are safe and sound.

Annual Performance Goals and Targets 2014 2013 2012

5. More closely align regulatory capital standards with risk and ensure 

that capital is maintained at prudential levels. 

• Finalize Basel III reporting instructions in time to ensure that 

institutions that are using the advanced approaches can implement Basel 

III in the first quarter of 2014 and that all IDIs 

can implement the standardized approach in the first quarter 

of 2015. 

ACHIEVED. 

• Publish a final Basel Liquidity Coverage Rule, in collaboration with 

other regulators by December 31, 2014. ACHIEVED. 

• Publish a final rule implementing the Basel III capital accord in 

collaboration with other regulators, by December 31, 2014. ACHIEVED.

• Finalize, in collaboration with other regulators, an enhanced U.S. 

supplementary leverage ratio standard by December 31, 2014. ACHIEVED.

• Complete by June 30, 2013, the review of comments and impact 

analysis of June 2012 proposed interagency changes to regulatory capital 

rules.

ACHIEVED.

• Issue by December 31, 2013, final regulatory capital rules. ACHIEVED.

• Complete by December 31, 2012, final rules addressing alternative 

standards of creditworthiness for credit ratings in the risk-based capital 

rules.

NOT 

ACHIEVED.

• Complete by December 31, 2012, a final rule for the Basel III capital 

standards.

NOT 

ACHIEVED.

• Complete by July 31, 2012, a final rule on the Market Risk 

Amendment, including finalizing alternatives to the use of credit ratings 

in accordance with Dodd-Frank Act (DFA) requirements.

ACHIEVED.

6. Identify and address risks in financial institutions designated as 

systemically important.

• Conduct ongoing risk analysis and monitoring of SIFIs to understand 

their structure, business activities and risk profiles, and their resolution 

and recovery capabilities. 

ACHIEVED. 

• Complete, in collaboration with the Federal Reserve Board and in 

accordance with statutory and regulatory time frames, all required 

actions associated with the review of Section 165(d) resolution plans 

submitted under Title 1 of DFA.

ACHIEVED.

• Complete, in collaboration with the Federal Reserve Board and in 

accordance with statutory and regulatory time frames, all required 

actions associated with the review of resolution plans submitted by 

financial companies subject to the requirements of Section 165(d) of 

the Dodd-Frank Act.

ACHIEVED. 
PERFORMANCE RESULTS SUMMARY 73

SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS (continued)

Strategic Goal: FDIC-supervised institutions are safe and sound.

Annual Performance Goals and Targets 2014 2013 2012

• Hold at least one meeting of the Systemic Resolution Advisory 

Committee to obtain feedback on resolving systemically important 

financial companies. 

ACHIEVED. ACHIEVED.

• Take all steps necessary to facilitate timely issuance of implementing 

regulations and related policy guidance on proprietary trading and other 

investment restrictions (also known as the Volcker Rule).

ACHIEVED.

• Take all steps necessary to facilitate timely issuance of implementing 

regulations and related policy guidance on restrictions on federal 

assistance to swaps entities.

ACHIEVED.

• Take all steps necessary to facilitate timely issuance of implementing 

regulations and related policy guidance on capital and margin and other 

requirements for over-the-counter derivatives.

ACHIEVED.

• Take all steps necessary to facilitate timely issuance of implementing 

regulations and related policy guidance on credit risk retention 

requirements for securitizations.

ACHIEVED.

• Take all steps necessary to facilitate timely issuance of implementing 

regulations and related policy guidance on enhanced compensation 

structure and incentive compensation requirements.

ACHIEVED.

• Monitor risk within and across large, complex firms to assess the 

potential need for, and obtain the information that would be required to 

carry out, if necessary, an FDIC resolution of the institution.

ACHIEVED.

• Establish by June 30, 2012, with the Board of Governors of the Federal 

Reserve System (FRB), policies and procedures for collecting, processing, 

and reviewing for completeness and sufficiency holding company and 

insured depository institution (IDI) resolution plans submitted under 

Section 165(d) of DFA. 

ACHIEVED.

• Complete, with the FRB and in accordance with prescribed time frames, 

the review of holding company and IDI resolution plans submitted 

under Section 165(d) of DFA.

ACHIEVED.

7. Implement strategies to promote enhanced cybersecurity within the 

banking industry. 

• In coordination with the FFIEC, implement recommendations to 

enhance the FDIC’s supervision of the IT risks at insured depository 

institutions and their technology service providers. 

ACHIEVED.
74 FEDERAL DEPOSIT INSURANCE CORPORATION

SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS

Strategic Goal: Consumers’ rights are protected and FDIC-supervised 

institutions invest in their communities.

Annual Performance Goals and Targets 2014 2013 2012

1. Conduct on-site CRA and compliance examinations to assess 

compliance with applicable laws and regulations by FDICsupervised depository institutions. 

• Conduct 100 percent of required examinations within the time frames 

established by FDIC policy. ACHIEVED.

2. Conduct on-site CRA and compliance examinations to assess 

compliance with applicable laws and regulations by FDIC-supervised 

depository institutions. When violations are identified, promptly 

implement appropriate corrective programs and follow up to ensure 

that identified problems are corrected. 

• Conduct 100 percent of required examinations within the time frames 

established by FDIC policy.

SUBSTANTIALLY 

ACHIEVED. 

ACHIEVED.

• Conduct visits and/or follow-up examinations in accordance with 

established FDIC policies to ensure that the requirements of any 

required corrective program have been implemented and are effectively 

addressing identified violations. 

ACHIEVED.

• Conduct visits and/or follow-up examinations in accordance with 

established FDIC policies and ensure that the requirements of any 

required corrective program have been implemented and are effectively 

addressing identified violations.

ACHIEVED.

3. Take prompt and effective supervisory action to monitor and 

address problems identified during compliance examinations of 

FDIC-supervised institutions that received an overall 3, 4, or 5 rating 

for compliance with consumer protection and fair lending laws. 

Ensure that each institution is fulfilling the requirements of any 

corrective program that has been implemented and that the actions 

taken are effectively addressing the underlying concerns identified 

during the examination.

• Conduct follow-up examinations or on-site visits for any unfavorably 

rated (3, 4, or 5) institution within 12 months of completion of the 

prior examination.

ACHIEVED.

4. Establish an effective working relationship with the new Consumer 

Financial Protection Bureau (CFPB).

• Complete the transfer of consumer complaint processing responsibilities 

within the purview of the CFPB within approved time frames. ACHIEVED.
PERFORMANCE RESULTS SUMMARY 75

SUPERVISION AND CONSUMER 

PROTECTION PROGRAM RESULTS (continued)

Strategic Goal: Consumers’ rights are protected and FDIC-supervised 

institutions invest in their communities.

Annual Performance Goals and Targets 2014 2013 2012

5. Effectively investigate and respond to written consumer complaints 

and inquiries about FDIC-supervised financial institutions.

• Respond to 95 percent of written consumer complaints and inquiries 

within time frames established by policy, with all complaints and 

inquiries receiving at least an initial acknowledgment within two weeks.

ACHIEVED. ACHIEVED. ACHIEVED.

6. Promote economic inclusion and access to responsible financial 

services through supervisory, research, policy, and consumer/

community affairs initiatives.

• Publish the results of the 2013 FDIC National Survey of Unbanked 

and Underbanked Households (conducted jointly with the U.S. Census 

Bureau). 

ACHIEVED. 

• Implement the strategy outlined in the work plan approved by the 

Advisory Committee on Economic Inclusion to support the responsible 

use of technology to expand banking services to the unbanked.

ACHIEVED. 

• Implement the strategy outlined in the work plan approved by the 

Advisory Committee on Economic Inclusion to support the expanded 

availability of Safe accounts and the responsible use of technology, to 

expand banking services to the underbanked.

ACHIEVED.

• Facilitate opportunities for banks and community stakeholders to 

address issues concerning access to financial services, community 

development, and financial education. 

ACHIEVED.

• Conduct the third biennial FDIC National Survey of Unbanked and 

Underbanked Households (conducted jointly with the U.S. Census 

Bureau).

ACHIEVED.

• Initiate work on the Survey of Banks’ Efforts to Serve the Unbanked and 

Underbanked. DEFERRED.

• Complete and publish results of the second biennial National Survey of 

Unbanked and Underbanked Households and Banks’ Efforts to Serve the 

Unbanked and Underbanked.

ACHIEVED.

• Plan and hold meetings of the Advisory Committee on Economic 

Inclusion to gain feedback and advice on FDIC efforts to promote 

inclusion.

ACHIEVED.

• Coordinate 25 CRA community forums nationwide to facilitate 

community development opportunities for financial institutions. ACHIEVED.
76 FEDERAL DEPOSIT INSURANCE CORPORATION

RECEIVERSHIP MANAGEMENT 

PROGRAM RESULTS

Strategic Goal: Resolutions are orderly and receiverships are managed effectively.

Annual Performance Goals and Targets 2014 2013 2012

1. Market failing institutions to all known qualified and interested 

potential bidders.

• Contact all known qualified and interested bidders. ACHIEVED. ACHIEVED. ACHIEVED.

2. Value, manage, and market assets of failed institutions and their 

subsidiaries in a timely manner to maximize net return.

• For at least 95 percent of insured institution failures, market at least 90 

percent of the book value of the institution’s marketable assets within 90 

days of the failure date (for cash sales) or 120 days of the failure date (for 

structured sales).

ACHIEVED. ACHIEVED. ACHIEVED.

3. Manage the receivership estate and its subsidiaries toward an 

orderly termination.

• Terminate at least 75 percent of new receiverships that are not subject 

to loss-share agreements, structured sales, or other legal impediments, 

within three years of the date of failure. 

ACHIEVED. ACHIEVED. ACHIEVED.

4. Conduct investigations into all potential professional liability claim 

areas for all failed insured depository institutions, and decide as 

promptly as possible to close or pursue each claim, considering the 

size and complexity of the institution.

• For 80 percent of all claim areas, a decision is made to close or pursue 

professional liability claims within 18 months of the failure date of an 

insured depository institution.

ACHIEVED. ACHIEVED. ACHIEVED.

5. Complete reviews of all loss-share and Limited Liability Corporation 

(LLC) agreements to ensure full compliance with the terms and 

conditions of the agreements.

• Complete reviews of 100 percent of the loss-share and LLC agreements 

active as of December 31, 2011, to ensure full compliance with the 

terms and conditions of the agreements.

ACHIEVED.

• Review the final report and implement an action plan to address the 

report’s finding and recommendations for 80 percent of the loss-share 

reviews and 70 percent of the LLC reviews.

ACHIEVED.
III. FINANCIAL HIGHLIGHTS

77

III.

Financial 

Highlights
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FINANCIAL HIGHLIGHTS 79

In its role as deposit insurer of financial institutions, 

the FDIC promotes the safety and soundness of 

IDIs. The following financial highlights address the 

performance of the Deposit Insurance Fund.

DEPOSIT INSURANCE 

FUND PERFORMANCE 

The DIF balance ended the year at $72.6 billion, an 

increase of $9.8 billion from $62.8 billion at yearend 2014. The DIF’s comprehensive income totaled 

$9.8 billion for 2015 compared to comprehensive 

income of $15.6 billion during 2014.  This $5.8 

billion year-over-year decrease was primarily due to 

a $6.0 billion lower negative provision for insurance 

losses, partially offset by a $191 million increase in 

assessment revenue and a $141 million increase in 

interest revenue.

The provision for insurance losses was negative 

$2.3 billion for 2015, compared to negative $8.3 

billion for 2014. The negative provision for 2015 

primarily resulted from a decrease of $2.2 billion 

in the estimated losses for institutions that failed 

in current and prior years, which was primarily 

attributable to (1) unanticipated recoveries of $1.0 

billion in litigation settlements, professional liability 

claims, and tax refunds by the receiverships; (2) a 

$1.4 billion decrease in the receiverships’ sharedloss liability; (3) an adjustment of $501 million for 

lower-than-anticipated loss estimates at time of failure 

for all current year failures; and (4) a $715 million 

increase in receivership legal and representation and 

warranty liabilities and projected future receivership 

expenses.  For the receiverships’ shared-loss liability, 

in 2015, covered asset balances decreased by $23.1 

billion as a result of loan amortizations and paydowns, as well as the expiration of 113 commercial 

shared-loss agreements and the early termination of 66 

shared-loss agreements.  Actual losses on this portion 

of covered assets were less than estimated at year-end 

2014.  The composition of the remaining covered 

asset portfolio primarily consists of performing single 

family assets, which have historically experienced 

significantly lower losses than commercial assets.  

Assessment revenue was $8.8 billion for 2015, as 

compared to $8.7 billion for 2014. The combination 

of declining assessment rates and increasing 

assessment base resulted in the modest increase in 

assessment revenue of $191 million. 

The DIF’s interest revenue on U.S. Treasury 

investments for 2015 was $423 million compared 

to interest revenue of $282 million in 2014.  This 

$141 million year-over-year increase reflects not only 

a larger investment portfolio balance, but also new, 

higher-yielding investments.  The DIF’s cash and 

U.S. Treasury investment portfolio balance was $63.4 

billion at year-end 2015, an increase of $11.7 billion 

from the year-end 2014 balance of $51.7 billion that 

was primarily due to assessment collections of $8.7 

billion and recoveries from resolutions of $6.3 billion, 

less resolution disbursements of $2.3 billion and 

operating expenses paid of $1.6 billion.
80 FEDERAL DEPOSIT INSURANCE CORPORATION

ESTIMATED DIF INSURED DEPOSITS

DEPOSIT INSURANCE FUND RESERVE RATIOS

SOURCE: Commercial Bank Call and Thrift Financial Reports

Note: Beginning in fourth quarter 2010 through fourth quarter 2012, estimated insured deposits include the entire balance of 

noninterest-bearing transaction accounts. Dollars in Billions

3-10 6-10 9-10 12-10 3-11 6-11 9-11 12-11 3-12 6-12 9-12 12-12 3-13 6-13 9-13 12-13 3-14 6-14 9-14 3-15 6-15 9-15 12-14

8,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

3-10 6-10 9-10 12-10 3-11 6-11 9-11 12-11 3-12 6-12 9-12 12-12 6-133-13 9-13 12-13 6-143-14 12-149-14 9-156-153-15

Fund Balance as a Percent of Insured Deposits

0.4

0.6

0.8

1.2

1.0

0.2

0.0

-0.2

-0.4
FINANCIAL HIGHLIGHTS 81

DEPOSIT INSURANCE FUND SELECTED STATISTICS 

Dollars in Millions

For the years ended December 31

2015 2014 2013

Financial Results

Revenue $9,304 $8,965 $10,459 

Operating Expenses 1,687 1,664 1,609 

Insurance and Other Expenses (includes provision for losses) (2,240) (8,299) (5,655)

Net Income 9,857 15,600 14,505 

Comprehensive Income 9,820 15,589 14,233 

Insurance Fund Balance $72,600 $62,780 $47,191 

Fund as a Percentage of Insured Deposits (reserve ratio) 1.09%3 1.01% 0.79%

Selected Statistics

Total DIF-Member Institutions1 6,2703 6,509 6,812 

Problem Institutions 2033 291 467 

Total Assets of Problem Institutions $51,0683 $86,712 $152,687 

Institution Failures 8 18 24 

Total Assets of Failed Institutions in Year2 $6,706 $2,914 $6,044 

Number of Active Failed Institution Receiverships 446 481 479 

1 Commercial banks and savings institutions. Does not include U.S. insured branches of foreign banks.

2 Total Assets data are based upon the last Call Report filed by the institution prior to failure.

3 As of September 30, 2015.
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IV. FDIC BUDGET AND 

SPENDING

83

IV.

FDIC Budget 

and Spending
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FDIC BUDGET AND SPENDING 85

CORPORATE 

OPERATING BUDGET

The FDIC segregates its corporate operating 

budget and expenses into two discrete components: 

ongoing operations and receivership funding. The 

receivership funding component represents expenses 

resulting from financial institution failures and is, 

therefore, largely driven by external forces, while the 

ongoing operations component accounts for all other 

operating expenses and tends to be more controllable 

and estimable. Corporate Operating expenses totaled 

$2.1 billion in 2015, including $1.7 billion in 

ongoing operations and $0.4 billion in receivership 

funding. This represented approximately 93 percent 

of the approved budget for ongoing operations and 

78 percent of the approved budget for receivership 

funding for the year.4

The Board of Directors approved a 2016 Corporate 

Operating Budget of approximately $2.2 billion, 

consisting of $1.8 billion for ongoing operations and 

$0.4 billion for receivership funding. The level of 

the approved ongoing operations budget for 2016 

is approximately $17 million (0.9 percent) higher 

than the 2015 ongoing operations budget, while 

the approved receivership funding budget is roughly 

$125 million (23.8 percent) lower than the 2015 

receivership funding budget.

As in prior years, the 2016 budget was formulated 

primarily on the basis of an analysis of projected 

workload for each of the Corporation’s three major 

business lines and its program support functions. The 

most significant factor contributing to the decrease 

in the Corporate Operating Budget is the improving 

health of the industry and the subsequent reduction 

in failure-related workload. Although savings in this 

area are being realized, the 2016 receivership funding 

budget provides resources for contractor support as 

well as nonpermanent staffing for DRR, the Legal 

Division, and other organizations, should workload in 

these areas require an immediate response.

4 The numbers in this paragraph will not agree with the DIF and FRF financial statements because of differences in how 

items are classified.

FDIC EXPENDITURES 2006–2015

Dollars in Millions

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$0
86 FEDERAL DEPOSIT INSURANCE CORPORATION

2015 BUDGET AND 

EXPENDITURES BY PROGRAM

(Excluding Investments)

The FDIC budget for 2015 totaled $2.3 billion. 

Budget amounts were allocated as follows: $1.023 

billion or 44.1 percent, to the Supervision and 

Consumer Protection program; $749 million, or 32.3 

percent, to the Receivership Management program;

$322 million, or 13.9 percent, to the Insurance 

program; and $225 million, or 9.7 percent, to 

Corporate General and Administrative expenditures.

Actual expenditures for the year totaled $2.1 

billion. Actual expenditures amounts were allocated 

as follows: $964 million, or 46.3 percent, to the 

Supervision and Consumer Protection program; 

$629 million, or 30.2 percent, to the Receivership 

Management program; $297 million, or 14.3 percent, 

to the Insurance program; and $194 million, or 9.3 

percent, to Corporate General and Administrative 

expenditures.

2015 BUDGET AND EXPENDITURES BY PROGRAM

(including Allocated Support) 

Dollars in Millions

Receivership

Management

Program

Insurance

Program

Supervision

and Consumer

Protection 

Program

General and

Administrative

$1,200

Budget

$900

$600

$300

$0

Expenditures
FDIC BUDGET AND SPENDING 87

INVESTMENT SPENDING 2006 - 2015

Dollars in Millions

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

$25

$15

$5

$10

$20

$30

$0

INVESTMENT SPENDING

The FDIC instituted a separate Investment Budget in 

2003 to provide enhanced governance of major multiyear development efforts. It has a disciplined process 

for reviewing proposed new investment projects and 

managing the construction and implementation 

of approved projects. Proposed IT projects are 

carefully reviewed to ensure that they are consistent 

with the Corporation’s enterprise architecture. The 

project approval and monitoring processes also 

enable the FDIC to be aware of risks to the major 

capital investment projects and facilitate appropriate, 

timely intervention to address these risks throughout 

the development process. An investment portfolio 

performance review is provided to the FDIC’s Board 

of Directors on a quarterly basis. 

From 2006–2015 investment spending totaled $149 

million, and is estimated at $9 million for 2016. 
THIS PAGE INTENTIONALLY LEFT BLANK
V. FINANCIAL SECTION

89

V.

Financial 

Section
90 FEDERAL DEPOSIT INSURANCE CORPORATION

FEDERAL DEPOSIT INSURANCE CORPORATION 

DEPOSIT INSURANCE FUND BALANCE SHEET AT DECEMBER 31

Dollars in Thousands

2015 2014

Assets

Cash and cash equivalents $876,344 $1,914,520

Investment in U.S. Treasury obligations (Note 3) 62,496,959 49,805,846

Assessments receivable, net (Note 9) 2,172,472 2,003,424

Interest receivable on investments and other assets, net 417,871 651,894

Receivables from resolutions, net (Note 4) 11,578,079 18,181,498

Property and equipment, net (Note 5) 378,250 372,419

Total Assets $77,919,975 $72,929,601

Liabilities

Accounts payable and other liabilities $272,571 $291,006

Liabilities due to resolutions (Note 6) 4,419,195 7,799,279

Postretirement benefit liability (Note 12) 233,000 243,419

Contingent liabilities:

Anticipated failure of insured institutions (Note 7) 394,588 1,814,770

Litigation losses (Note 7) 386 950

Total Liabilities 5,319,740 10,149,424

Commitments and off-balance-sheet exposure (Note 13)

Fund Balance

Accumulated Net Income 72,643,474 62,786,786

Accumulated Other Comprehensive Income

Unrealized (loss) gain on U.S. Treasury investments, net (Note 3) (9,191) 51,142

Unrealized postretirement benefit loss (Note 12) (34,048) (57,751)

Total Accumulated Other Comprehensive Income (Loss) (43,239) (6,609)

Total Fund Balance 72,600,235 62,780,177

Total Liabilities and Fund Balance $77,919,975 $72,929,601

The accompanying notes are an integral part of these financial statements.

DEPOSIT INSURANCE FUND (DIF)
FINANCIAL SECTION 91

FEDERAL DEPOSIT INSURANCE CORPORATION 

DEPOSIT INSURANCE FUND STATEMENT OF INCOME AND 

FUND BALANCE FOR THE YEARS ENDED DECEMBER 31

Dollars in Thousands

2015 2014

Revenue

Assessments (Note 9) $8,846,843 $8,656,082

Interest on U.S. Treasury obligations 422,782 281,924

Other revenue 33,913 27,059

Total Revenue 9,303,538 8,965,065

Expenses and Losses

Operating expenses (Note 10) 1,687,234 1,664,344

Provision for insurance losses (Note 11) (2,251,320) (8,305,577)

Insurance and other expenses 10,936 6,486

Total Expenses and Losses (553,150) (6,634,747)

Net Income 9,856,688 15,599,812

Other Comprehensive Income

Unrealized (loss) gain on U.S. Treasury investments, net (60,333) 30,927

Unrealized postretirement benefit gain (loss) (Note 12) 23,703 (41,401)

Total Other Comprehensive Income (Loss) (36,630) (10,474)

Comprehensive Income 9,820,058 15,589,338

Fund Balance - Beginning 62,780,177 47,190,839

Fund Balance - Ending $72,600,235 $62,780,177

The accompanying notes are an integral part of these financial statements.

DEPOSIT INSURANCE FUND (DIF)
92 FEDERAL DEPOSIT INSURANCE CORPORATION

FEDERAL DEPOSIT INSURANCE CORPORATION 

DEPOSIT INSURANCE FUND STATEMENT OF CASH FLOWS 

FOR THE YEARS ENDED DECEMBER 31

Dollars in Thousands

2015 2014

Operating Activities

Provided by:

Assessments $8,677,795 $8,873,123

Interest on U.S. Treasury obligations 2,064,836 1,450,939

Recoveries from financial institution resolutions 6,329,454 4,099,804

Miscellaneous receipts 147,001 78,558

Used by:

Operating expenses (1,631,297) (1,586,858)

Disbursements for financial institution resolutions (2,282,721) (1,860,014)

Miscellaneous disbursements (107,478) (15,385)

Net Cash Provided by Operating Activities 13,197,590 11,040,167

Investing Activities

Provided by:

Maturity of U.S. Treasury obligations 19,590,780 17,158,275

Used by:

Purchase of U.S. Treasury obligations (33,766,067) (29,771,897)

Purchase of property and equipment (60,479) (55,295)

Net Cash (Used) by Investing Activities (14,235,766) (12,668,917)

Net (Decrease) in Cash and Cash Equivalents (1,038,176) (1,628,750)

Cash and Cash Equivalents - Beginning 1,914,520 3,543,270

Cash and Cash Equivalents - Ending $876,344 $1,914,520

The accompanying notes are an integral part of these financial statements.

DEPOSIT INSURANCE FUND (DIF)
FINANCIAL SECTION 93

NOTES TO THE 

FINANCIAL STATEMENTS

DEPOSIT INSURANCE FUND

December 31, 2015 and 2014

1. OPERATIONS OF THE 

DEPOSIT INSURANCE FUND

OVERVIEW

The Federal Deposit Insurance Corporation (FDIC) 

is the independent deposit insurance agency created 

by Congress in 1933 to maintain stability and public 

confidence in the nation’s banking system. Provisions 

that govern the FDIC’s operations are generally 

found in the Federal Deposit Insurance (FDI) Act, 

as amended (12 U.S.C. 1811, et seq). In accordance 

with the FDI Act, the FDIC, as administrator of the 

Deposit Insurance Fund (DIF), insures the deposits 

of banks and savings associations (insured depository 

institutions). In cooperation with other federal and 

state agencies, the FDIC promotes the safety and 

soundness of insured depository institutions (IDIs) by 

identifying, monitoring, and addressing risks to the 

DIF. Commercial banks, savings banks and savings 

associations (known as “thrifts”) are supervised by 

either the FDIC, the Office of the Comptroller of the 

Currency, or the Federal Reserve Board.

In addition to being the administrator of the 

DIF, the FDIC is the administrator of the FSLIC 

Resolution Fund (FRF). The FRF is a resolution 

fund responsible for the sale of the remaining assets 

and the satisfaction of the liabilities associated with 

the former Federal Savings and Loan Insurance 

Corporation (FSLIC) and the former Resolution Trust 

Corporation. The FDIC maintains the DIF and the 

FRF separately to support their respective functions.

Pursuant to the Dodd-Frank Wall Street Reform 

and Consumer Protection Act of 2010 (Dodd-Frank 

Act), the FDIC also manages the Orderly Liquidation 

Fund (OLF). Established as a separate fund in the 

U.S. Treasury (Treasury), the OLF is inactive and 

unfunded until the FDIC is appointed as receiver 

for a covered financial company. A covered financial 

company is a failing financial company (for example, 

a bank holding company or nonbank financial 

company) for which a systemic risk determination 

has been made as set forth in section 203 of the 

Dodd-Frank Act.

The Dodd-Frank Act (Public Law 111-203) granted 

the FDIC authority to establish a widely available 

program to guarantee obligations of solvent IDIs or 

solvent depository institution holding companies 

(including affiliates) upon the systemic risk 

determination of a liquidity event during times of 

severe economic distress. The program would not be 

funded by the DIF but rather by fees and assessments 

paid by all participants in the program. If fees are 

insufficient to cover losses or expenses, the FDIC 

must impose a special assessment on participants as 

necessary to cover the shortfall. Any excess funds 

at the end of the liquidity event program would be 

deposited in the General Fund of the Treasury.

The Dodd-Frank Act also created the Financial 

Stability Oversight Council (FSOC) of which the 

Chairman of the FDIC is a member and expanded 

the FDIC’s responsibilities to include supervisory 

review of resolution plans (known as living wills) 

and backup examination authority for systemically 

important bank holding companies and nonbank 

financial companies. The living wills provide for an 

entity’s rapid and orderly resolution in the event of 

material financial distress or failure.

OPERATIONS OF THE DIF

The primary purposes of the DIF are to (1) insure the 

deposits and protect the depositors of IDIs and (2) 

resolve failed IDIs upon appointment of the FDIC 

as receiver in a manner that will result in the least 

possible cost to the DIF.
94 FEDERAL DEPOSIT INSURANCE CORPORATION

The DIF is primarily funded from deposit insurance 

assessments. Other available funding sources, if 

necessary, are borrowings from the Treasury, the 

Federal Financing Bank (FFB), Federal Home Loan 

Banks, and IDIs. The FDIC has borrowing authority 

of $100 billion from the Treasury and a Note 

Purchase Agreement with the FFB, not to exceed 

$100 billion, to enhance the DIF’s ability to fund 

deposit insurance.

A statutory formula, known as the Maximum 

Obligation Limitation (MOL), limits the amount of 

obligations the DIF can incur to the sum of its cash, 

90 percent of the fair market value of other assets, 

and the amount authorized to be borrowed from the 

Treasury. The MOL for the DIF was $171.0 billion 

and $162.0 billion as of December 31, 2015 and 

2014, respectively.

OPERATIONS OF RESOLUTION ENTITIES

The FDIC is responsible for managing and disposing 

of the assets of failed institutions in an orderly and 

efficient manner. The assets held by receiverships, 

pass-through conservatorships, and bridge institutions 

(collectively, resolution entities), and the claims 

against them, are accounted for separately from the 

DIF assets and liabilities to ensure that proceeds from 

these entities are distributed according to applicable 

laws and regulations. Therefore, income and expenses 

attributable to resolution entities are accounted 

for as transactions of those entities. The FDIC 

bills resolution entities for services provided on 

their behalf.

2. SUMMARY OF SIGNIFICANT 

ACCOUNTING POLICIES

GENERAL

The financial statements include the financial 

position, results of operations, and cash flows of 

the DIF and are presented in accordance with U.S. 

generally accepted accounting principles (GAAP). 

These statements do not include reporting for assets 

and liabilities of resolution entities because these 

entities are legally separate and distinct, and the DIF 

does not have any ownership or beneficial interests 

in them. Periodic and final accounting reports of 

resolution entities are furnished to courts, supervisory 

authorities, and others upon request.

USE OF ESTIMATES

The preparation of the financial statements in 

conformity with GAAP requires management to make 

estimates and assumptions that affect the reported 

amounts of assets and liabilities, revenue and expenses, 

and disclosure of contingent liabilities. Actual 

results could differ from these estimates. Where it 

is reasonably possible that changes in estimates will 

cause a material change in the financial statements 

in the near term, the nature and extent of such 

potential changes in estimates have been disclosed. 

The more significant estimates include the assessments 

receivable and associated revenue; the allowance 

for loss on receivables from resolutions (which

considers the impact of shared-loss agreements); the 

guarantee obligations for structured transactions; the 

postretirement benefit obligation; and the estimated 

losses for anticipated failures and representations and 

indemnifications.

CASH EQUIVALENTS

Cash equivalents are short-term, highly liquid 

investments consisting primarily of U.S. Treasury 

Overnight Certificates.

INVESTMENT IN U.S. TREASURY 

OBLIGATIONS

The FDI Act requires that the DIF funds be invested 

in obligations of the United States or in obligations 

guaranteed as to principal and interest by the United 

States. The Secretary of the Treasury must approve 

all such investments in excess of $100,000 and has 

granted the FDIC approval to invest the DIF funds 

only in U.S. Treasury obligations that are purchased 

or sold exclusively through the Bureau of the Fiscal 

Service’s Government Account Series program.
FINANCIAL SECTION 95

The DIF’s investments in U.S. Treasury obligations are 

classified as available-for-sale. Securities designated as 

available-for-sale are shown at fair value. Unrealized 

gains and losses are reported as other comprehensive 

income. Realized gains and losses are included 

in the Statement of Income and Fund Balance as 

components of net income. Income on securities 

is calculated and recorded daily using the effective 

interest or straight-line method depending on the 

maturity of the security (see Note 3).

REVENUE RECOGNITION 

FOR ASSESSMENTS

Assessment revenue is recognized for the quarterly 

period of insurance coverage based on an estimate. 

The estimate is derived from an institution’s risk-based 

assessment rate and assessment base for the prior 

quarter adjusted for the current quarter’s available 

assessment credits, certain changes in supervisory 

examination ratings for larger institutions, as well 

as modest assessment base growth and average 

assessment rate adjustment factors. At the subsequent 

quarter-end, the estimated revenue amounts are 

adjusted when actual assessments for the covered 

period are determined for each institution 

(see Note 9).

CAPITAL ASSETS AND DEPRECIATION

The FDIC buildings are depreciated on a straight-line 

basis over a 35- to 50-year estimated life. Building 

improvements are capitalized and depreciated over the 

estimated useful life of the improvements. Leasehold 

improvements are capitalized and depreciated 

over the lesser of the remaining life of the lease or 

the estimated useful life of the improvements, if 

determined to be material. Capital assets depreciated 

on a straight-line basis over a five-year estimated 

useful life include mainframe equipment; furniture, 

fixtures, and general equipment; and internal-use 

software. Computer equipment is depreciated on a 

straight-line basis over a three-year estimated useful 

life (see Note 5).

PROVISION FOR INSURANCE LOSSES

The provision for insurance losses primarily represents 

changes in the allowance for losses on receivables 

from closed banks and the contingent liability 

for anticipated failures of insured institutions 

(see Note 11).

REPORTING ON VARIABLE 

INTEREST ENTITIES

The FDIC receiverships engaged in structured 

transactions, some of which resulted in the issuance 

of note obligations that were guaranteed by the 

FDIC, in its corporate capacity. As the guarantor of 

note obligations for several structured transactions, 

the FDIC, in its corporate capacity, holds an 

interest in many variable interest entities (VIEs). 

The FDIC conducts a qualitative assessment of 

its relationship with each VIE as required by the 

Financial Accounting Standards Board (FASB) 

Accounting Standards Codification (ASC) Topic 

810, Consolidation. These assessments are conducted 

to determine if the FDIC, in its corporate capacity, 

has (1) power to direct the activities that most 

significantly affect the economic performance of the 

VIE and (2) an obligation to absorb losses of the 

VIE or the right to receive benefits from the VIE 

that could potentially be significant to the VIE. 

When a variable interest holder has met both of 

these characteristics, the enterprise is considered the 

primary beneficiary and must consolidate the VIE.

In accordance with the provisions of FASB ASC Topic 

810, an assessment of the terms of the legal agreement 

for each VIE was conducted to determine whether 

any of the terms had been activated or modified in a 

manner that would cause the FDIC, in its corporate 

capacity, to be characterized as a primary beneficiary. 

In making that determination, consideration was 

given to which, if any, activities were significant to 

each VIE. Often, the right to service collateral, to 

liquidate collateral, or to unilaterally dissolve the VIE 

was determined to be the most significant activity. 

In other cases, it was determined that the structured 
96 FEDERAL DEPOSIT INSURANCE CORPORATION

transactions did not include such significant activities 

and that the design of the entity was the best indicator 

of which party was the primary beneficiary.

The conclusion of these analyses was that the 

FDIC, in its corporate capacity, has not engaged 

in any activity that would cause the FDIC to be 

characterized as a primary beneficiary to any VIE 

with which it was involved as of December 31, 2015 

and 2014. Therefore, consolidation is not required 

for the 2015 and 2014 DIF financial statements. In 

the future, the FDIC, in its corporate capacity, may 

become the primary beneficiary upon the activation 

of provisional contract rights that extend to the FDIC 

if payments are made on guarantee claims. Ongoing 

analyses will be required to monitor consolidation 

implications under FASB ASC Topic 810.

The FDIC’s involvement with VIEs is fully described 

in Note 8 under FDIC Guaranteed Debt of 

Structured Transactions.

RELATED PARTIES

The nature of related parties and a description of 

related party transactions are discussed in Note 1 

and disclosed throughout the financial statements 

and footnotes.

DISCLOSURE ABOUT RECENT RELEVANT 

ACCOUNTING PRONOUNCEMENTS

In February 2015, the FASB issued Accounting 

Standards Update (ASU) No. 2015-02, Amendments 

to the Consolidation Analysis. Effective for periods 

beginning after December 15, 2016, the ASU amends 

an entity’s consolidation analysis for determining 

whether it should consolidate a legal entity. The 

FDIC, in its corporate capacity, has determined that 

the ASU does not impact its consolidation analysis of 

structured transactions.

In April 2015, the FASB issued ASU 2015-05, 

Intangibles – Goodwill and Other – Internal-Use 

Software (Subtopic 350-40): Customer’s Accounting for 

Fees Paid in a Cloud Computing Arrangement. The 

guidance clarifies circumstances under which a cloud 

computing arrangement would be considered a license 

of internal-use software or a service contract. The 

ASU, which is effective for the DIF beginning on 

January 1, 2016, is not expected to have a material 

effect on the DIF’s financial condition or results of 

operations.

In May 2014, the FASB issued ASU 2014-09, 

Revenue from Contracts with Customers (Topic 606). 

The ASU will require an entity to recognize revenue 

based on the amount it expects to be entitled for the 

transfer of promised goods or services. In August 

2015, the FASB issued ASU No. 2015-14, Revenue 

from Contracts with Customers (Topic 606): Deferral of 

Effective Date, deferring the original effective date of 

the new revenue standard by one year. For the DIF, 

the deferral results in the new revenue standard being 

effective for annual periods beginning after December 

15, 2018. The FDIC does not expect the new ASU to 

have a material effect on the DIF.

Other recent accounting pronouncements have been 

deemed not applicable or material to the financial 

statements as presented.

3. INVESTMENT IN U.S.

TREASURY OBLIGATIONS

The “Investment in U.S. Treasury obligations” line 

item on the Balance Sheet consisted of the following 

components by maturity (in thousands).
FINANCIAL SECTION 97

Maturity

Yield at 

Purchase1

Face 

Value

Net 

Carrying 

Amount

Unrealized 

Holding 

Gains

Unrealized 

Holding 

Losses

Fair

Value

U.S. Treasury notes and bonds

Within 1 year 0.54% $21,495,000 $21,816,062 $2,518 $(17,526) $21,801,054

After 1 year 

through 5 years 1.19% 39,881,209 39,951,893 55,159 (43,912) 39,963,140

Subtotal $61,376,209 $61,767,955 $57,677 $(61,438) $61,764,194

U.S. Treasury Inflation-Protected Securities

Within 1 year -0.80% $300,000 $324,100 $0 $(2,101) $321,999

After 1 year 

through 5 years -0.14% 400,000 414,095 0 (3,329) 410,766

Subtotal $700,000 $738,195 $0 $(5,430) $732,765

Total $62,076,209 $62,506,150 $57,677 $(66,868)2 $62,496,959

1

 The Treasury Inflation-Protected Securities (TIPS) are indexed to increases or decreases in the Consumer Price Index for All Urban Consumers (CPI-U). 

For TIPs, the yields in the above table are stated at their real yields at purchase, not their effective yields. Effective yields on TIPS include a long-term 

annual inflation assumption as measured by the CPI-U. The long-term CPI-U consensus forecast is 1.8 percent, based on figures issued by 

the Congressional Budget Office and Blue Chip Economic Indicators in early 2015.

2

 These unrealized losses occurred over a period of less than a year as a result of temporary changes in market interest rates. The FDIC does not 

intend to sell the securities and is not likely to be required to sell them before their maturity date, thus, the FDIC does not consider these securities 

to be other than temporarily impaired at December 31, 2015. The aggregate related fair value of securities with unrealized losses was $38.7 billion 

as of December 31, 2015.

Maturity

Yield at 

Purchase1

Face 

Value

Net 

Carrying 

Amount

Unrealized 

Holding 

Gains

Unrealized 

Holding 

Losses

Fair

Value

U.S. Treasury notes and bonds

Within 1 year 0.28% $12,450,000 $12,861,127 $2,291 $(4,516) $12,858,902

After 1 year 

through 5 years 0.91% 33,901,209 34,393,283 86,212 (5,759) 34,473,736

Subtotal $46,351,209 $47,254,410 $88,503 $(10,275) $47,332,638

U.S. Treasury Inflation-Protected Securities

Within 1 year -1.03% $1,500,000 $1,759,237 $0 $(17,120) $1,742,117

After 1 year 

through 5 years -0.43% 700,000 741,057 0 (9,966) 731,091

Subtotal $2,200,000 $2,500,294 $0 $(27,086) $2,473,208

Total $48,551,209 $ 49,754,704 $88,503 $(37,361)2 $49,805,846

1

 The Treasury Inflation-Protected Securities (TIPS) are indexed to increases or decreases in the Consumer Price Index for All Urban Consumers (CPI-U). 

For TIPs, the yields in the above table are stated at their real yields at purchase, not their effective yields. Effective yields on TIPS include a longterm annual inflation assumption as measured by the CPI-U. The long-term CPI-U consensus forecast is 2.0 percent, based on figures issued by the 

Congressional Budget Office and Blue Chip Economic Indicators in early 2014.

2

 These unrealized losses occurred over a period of less than a year as a result of temporary changes in market interest rates. The FDIC does not 

intend to sell the securities and is not likely to be required to sell them before their maturity date, thus, the FDIC does not consider these securities to 

be other than temporarily impaired at December 31, 2014. The aggregate related fair value of securities with unrealized losses was $19.0 billion as of 

December 31, 2014.

December 31, 2015

December 31, 2014
98 FEDERAL DEPOSIT INSURANCE CORPORATION

4. RECEIVABLES FROM 

RESOLUTIONS, NET

The receivables from resolutions result from DIF 

payments to cover obligations to insured depositors 

(subrogated claims), advances to resolution entities 

for working capital, and administrative expenses 

paid on behalf of resolution entities. Any related 

allowance for loss represents the difference between 

the funds advanced and/or obligations incurred and 

the expected repayment. Estimated future payments 

on losses incurred on assets sold to an acquiring 

institution under a shared-loss agreement (SLA) 

are factored into the computation of the expected 

repayment. Assets held by DIF resolution entities 

(including structured transaction-related assets; see 

Note 8) are the main source of repayment of the 

DIF’s receivables from resolutions. The “Receivables 

from resolutions, net” line item on the Balance Sheet 

consisted of the following components (in thousands).

December 31

2015

December 31 

2014

Receivables from 

closed banks $88,858,877 $98,360,904

Allowance for losses (77,280,798) (80,179,406)

Total $11,578,079 $18,181,498

As of December 31, 2015, the FDIC had 446 active 

receiverships, including eight established in 2015. 

The DIF resolution entities held assets with a book 

value of $20.8 billion as of December 31, 2015, and 

$29.7 billion as of December 31, 2014 (including 

$16.0 billion and $22.0 billion, respectively, of cash, 

investments, receivables due from the DIF, and other 

receivables). Ninety-nine percent of the current asset 

book value of $20.8 billion is held by resolution 

entities established since the beginning of 2008.

Estimated cash recoveries from the management and 

disposition of assets that are used to determine the 

allowance for losses are based on asset recovery rates 

from several sources, including actual or pending 

institution-specific asset disposition data, failed 

institution-specific asset valuation data, aggregate 

asset valuation data on several recently failed or 

troubled institutions, sampled asset valuation data, 

and empirical asset recovery data based on failures 

since 1990. Methodologies for determining the asset 

recovery rates incorporate estimating future cash 

recoveries, net of applicable liquidation cost estimates, 

and discounting based on market-based risk factors 

applicable to a given asset’s type and quality. The 

resulting estimated cash recoveries are then used to 

derive the allowance for loss on the receivables from 

these resolutions.

For failed institutions resolved using a whole bank 

purchase and assumption transaction with an 

accompanying SLA, the projected future shared-loss 

payments on the covered residential and commercial 

loan assets sold to the acquiring institution under 

the agreement are considered in determining the 

allowance for loss on the receivables from these 

resolutions. The shared-loss cost projections are 

based on the covered assets’ intrinsic value, which 

is determined using financial models that consider 

the quality, condition and type of covered assets, 

current and future market conditions, risk factors, 

and estimated asset holding periods. For year-end 

2015, the shared-loss cost estimates were updated for 

all 215 receiverships with active SLAs. The updated 

shared-loss cost projections for the larger residential 

shared-loss agreements were primarily based on new 

third-party valuations estimating the cumulative 

loss of covered assets. The updated shared-loss cost 

projections on the remaining residential sharedloss agreements were based on a stratified random 

sample of institutions selected for new third-party 

loss estimations, and valuation results from the 

sampled institutions were aggregated and extrapolated 

to the non-sampled institutions by asset type and 

performance status.

In 2015, the FDIC eliminated the use of third-party 

valuations for the remaining commercial covered 

assets. Instead, loss rates were based on the FDIC’s 

historical loss experience that also factors in the 

time period based on the life of the agreement. In 

addition, for all shared-loss agreements, the rate used 

for discounting the cash flows was changed in 2015 

to the Treasury spot rate curve instead of the 3-year 

Constant Maturity Treasury rate. These changes were 
FINANCIAL SECTION 99

made to address the shift to a predominantly singlefamily asset mix and did not have a material impact 

on the shared-loss liability.

Also reflected in the allowance for loss calculation are 

end-of-agreement SLA “true-up” recoveries. True-up 

recoveries are projected to be received at expiration in 

accordance with the terms of the SLA, if actual losses 

at expiration are lower than originally estimated.

Note that estimated asset recoveries are regularly 

evaluated during the year, but remain subject 

to uncertainties because of potential changes in 

economic and market conditions, which may cause 

the DIF’s actual recoveries to vary significantly from 

current estimates.

WHOLE BANK PURCHASE AND 

ASSUMPTION TRANSACTIONS 

WITH SHARED-LOSS AGREEMENTS

Since the beginning of 2008 through 2013, the 

FDIC resolved 304 failures using whole bank 

purchase and assumption resolution transactions with 

accompanying SLAs on total assets of $216.5 billion 

purchased by the financial institution acquirers. 

The acquirer typically assumed all of the deposits 

and purchased essentially all of the assets of a failed 

institution. The majority of the commercial and 

residential loan assets were purchased under an SLA, 

where the FDIC agreed to share in future losses and 

recoveries experienced by the acquirer on those assets 

covered under the agreement.

Losses on the covered assets of failed institutions are 

shared between the acquirer and the FDIC, in its 

receivership capacity, when losses occur through the 

sale, foreclosure, loan modification, or charge-off of 

loans under the terms of the SLA. The majority of the 

agreements cover commercial and single-family loans 

over a five- to ten-year shared-loss period, respectively, 

with the receiver covering 80 percent of the losses 

incurred by the acquirer and the acquiring institution 

covering 20 percent. Prior to March 26, 2010, most 

SLAs included a threshold amount, above which the 

receiver covered 95 percent of the losses incurred by 

the acquirer. Recoveries by the acquirer on covered 

commercial and single-family SLA losses are also 

shared over an eight- to ten-year period, respectively. 

Note that future recoveries on SLA losses are not 

factored into the DIF allowance for loss calculation 

because the amount and timing of such receipts are 

not determinable.

The estimated shared-loss liability is accounted for 

by the receiver and is included in the calculation of 

the DIF’s allowance for loss against the corporate 

receivable from the resolution. As shared-loss claims 

are asserted and proven, DIF receiverships satisfy these 

shared-loss payments using available liquidation funds 

and/or by drawing on amounts due from the DIF 

for funding the deposits assumed by the acquirer 

(see Note 6).

Shared-loss transactions are summarized as follows 

(in thousands).

December 31 

2015

December 31

2014

Payments for shared-loss 

agreements to date $33,475,276 $31,790,385

Recoveries from 

shared-loss agreements 

to date (4,468,296) (3,620,038)

Net shared-loss payments 

made to date $29,006,980 $28,170,347

Projected shared-loss 

payments, net of 

“true-up” recoveries $1,560,124 $3,942,689

Total remaining sharedloss covered assets $31,478,451 $54,589,505

The $23.1 billion reduction in the remaining sharedloss covered assets from 2014 to 2015 is primarily due 

to the liquidation of covered assets from active SLAs, 

expiration of loss coverage for 113 commercial loan 

SLAs, and early termination of 66 SLAs during 2015.

CONCENTRATION OF CREDIT RISK

Financial instruments that potentially subject the DIF 

to concentrations of credit risk are receivables from 

resolutions. The repayment of these receivables is 

primarily influenced by recoveries on assets held by 

DIF receiverships and payments on the covered assets 
100 FEDERAL DEPOSIT INSURANCE CORPORATION

under SLAs. The majority of the remaining assets 

in liquidation ($4.8 billion) and current shared-loss 

covered assets ($31.5 billion), which together total 

$36.3 billion, are concentrated in commercial loans 

($5.8 billion), residential loans ($25.7 billion), and 

structured transaction-related assets ($3.5 billion) as 

described in Note 8. Most of the assets originated 

from failed institutions located in California ($13.8 

billion), Puerto Rico ($5.2 billion), Florida ($4.2 

billion), Ohio ($2.8 billion), Texas ($1.9 billion), and 

Alabama ($1.7 billion).

5. PROPERTY AND

EQUIPMENT, NET

Depreciation expense was $52 million and $60 

million for 2015 and 2014, respectively. The 

“Property and equipment, net” line item on the 

Balance Sheet consisted of the following components 

(in thousands).

December 31

2015

December 31 

2014

Land $37,352 $37,352

Buildings (including 

building and leasehold 

improvements) 342,267 326,067

Application software 

(includes work-in-process) 132,280 142,907

Furniture, fixtures, and 

equipment 73,432 104,761

Accumulated depreciation (207,081) (238,668)

Total $378,250 $372,419

6. LIABILITIES DUE 

TO RESOLUTIONS

As of December 31, 2015 and 2014, the DIF 

recorded liabilities totaling $4.4 billion and $7.8 

billion, respectively, to resolution entities representing 

the agreed-upon value of assets transferred from the 

receiverships, at the time of failure, to the acquirers/

bridge institutions for use in funding the deposits 

assumed by the acquirers/bridge institutions. Eightyseven percent of these liabilities are due to failures 

resolved under whole-bank purchase and assumption 

transactions, most with an accompanying SLA. The 

DIF satisfies these liabilities either by sending cash 

directly to a receivership to fund shared-loss and other 

expenses or by offsetting receivables from resolutions 

when a receivership declares a dividend.

7. CONTINGENT LIABILITIES

ANTICIPATED FAILURE OF 

INSURED INSTITUTIONS

The DIF records a contingent liability and a loss 

provision for DIF-insured institutions that are 

likely to fail when the liability is probable and 

reasonably estimable, absent some favorable event 

such as obtaining additional capital or merging. The 

contingent liability is derived by applying expected 

failure rates and loss rates to the institutions based on 

supervisory ratings, balance sheet characteristics, and 

projected capital levels.

The banking industry’s financial condition and 

performance continued to improve in 2015. 

According to the quarterly financial data submitted 

by DIF-insured institutions, the industry reported 

total net income of $123.4 billion for the first nine 

months of 2015, an increase of 6.2 percent over 

the comparable period one year ago. The industry’s 

capital levels also continued to improve, and 

noncurrent loans declined, as the industry’s ratio of 

noncurrent loans-to-total loans fell to its lowest level 

since year-end 2007.

Losses to the DIF from failures that occurred in 2015 

were lower than the contingent liability at the end of 

2014, as the aggregate number and cost of institution 

failures were less than anticipated. The removal of the 

liability from institutions that failed in 2015, as well 

as favorable trends in bank supervisory downgrade 

and failure rates, all contributed to a decline in the 

contingent liability from $1.8 billion at December 31, 

2014 to $395 million at December 31, 2015.
FINANCIAL SECTION 101

In addition to the recorded contingent liabilities, the 

FDIC has identified risks in the financial services 

industry that could result in additional losses to 

the DIF, should potentially vulnerable insured 

institutions ultimately fail. As a result of these risks, 

the FDIC believes that it is reasonably possible that 

the DIF could incur additional estimated losses of 

approximately $800 million as of December 31, 

2015, as compared to $1.7 billion as of year-end 

2014. The actual losses, if any, will largely depend 

on future economic and market conditions and could 

differ materially from this estimate.

During 2015, eight institutions failed with combined 

assets of $5.7 billion at the date of failure. Recent 

trends in supervisory ratings and market data suggest 

that the financial performance and condition of the 

banking industry should continue to improve over the 

coming year. However, exposure to interest rate risk, 

credit risk, reliance on short-term sources of funding, 

and limited opportunities for revenue growth will 

continue to stress the industry. Additionally, key 

risks continue to weigh on the economic outlook as 

well, including the impact of rising interest rates as 

they return to more normal levels; fiscal challenges at 

federal, state, and local levels; and global economic 

risks. The FDIC continues to evaluate ongoing risks 

to affected institutions in light of existing economic 

and financial conditions, and the extent to which 

such risks may put stress on the resources of the 

insurance fund.

LITIGATION LOSSES

The DIF records an estimated loss for unresolved legal 

cases to the extent that those losses are considered 

probable and reasonably estimable. The FDIC 

recorded probable litigation losses of $386 thousand 

and $950 thousand for the DIF as of December 31, 

2015 and 2014, respectively. In addition, the FDIC 

has determined that there are $555 thousand of 

reasonably possible losses from unresolved cases 

as of December 31, 2015, compared to none at 

year-end 2014.

8. OTHER CONTINGENCIES

INDYMAC FEDERAL BANK 

REPRESENTATION AND 

INDEMNIFICATION 

CONTINGENT LIABILITY

On March 19, 2009, the FDIC as receiver for 

IndyMac Federal Bank (IMFB) and certain 

subsidiaries (collectively, Sellers) sold substantially 

all of the assets, which included mortgage loans 

and servicing rights, to OneWest Bank (following a 

merger is now known as CIT Bank) and its affiliates 

(collectively, Acquirers). The Sellers made certain 

representations customarily made by commercial 

parties in similar transactions. Under the sale 

agreements, the Acquirers have rights to assert 

claims to recover losses incurred as a result of thirdparty claims and breaches of representations. The 

FDIC, in its corporate capacity, guaranteed the 

Sellers’ indemnification obligations under the sale 

agreements. Until all indemnification claims are 

asserted, quantified and paid, losses could continue to 

be incurred by the receivership and in turn, the DIF.

The unpaid principal balances of loans in the servicing 

portfolios sold subject to representation and warranty 

indemnification totaled $171.6 billion at the time of 

sale. The IndyMac receivership has paid cumulative 

claims totaling $21 million through December 31, 

2015 and 2014. Quantified claims asserted and 

under review have been accrued in the amount of 

$1 million and $6 million as of December 31, 2015 

and 2014, respectively.

Fannie Mae has demanded the repurchase of $87 

million of conventional and reverse mortgage loans. 

However, the Sellers do not anticipate repurchasing 

any mortgage loans from Fannie Mae. Instead, 

the Sellers and the Acquirers are negotiating the 

terms of a financial settlement for the Fannie Mae 

portfolio. It is anticipated this settlement would 

resolve indemnification obligations of the Sellers 

to the Acquirers and Fannie Mae. As a result, it is 

probable the Sellers will incur losses. The impact 
102 FEDERAL DEPOSIT INSURANCE CORPORATION

of this receivership estimated loss is reflected in the 

“Receivables from resolutions, net” line item on the 

Balance Sheet.

The FDIC is evaluating the likelihood of additional 

losses that may arise as a result of indemnification 

claims based upon breaches or third party claims. 

As the Acquirers or Government Sponsored Entities 

(GSEs) – Fannie Mae, Freddie Mac and Ginnie Mae 

incur or expect to incur losses, they will assert claims. 

These claims will be reviewed to determine whether 

there is a basis for indemnification or reimbursement 

and, if so, whether any Acquirer may have liability for 

any portion of the claimed loss as a result of its acts or 

omissions. While many loans are subject to notices of 

alleged breaches and a number of third party claims 

have been asserted, not all breach allegations or third 

party claims will result in a loss and certain losses may 

be allocable to the Acquirers. As a result, potential 

losses, and the Sellers’ share of such losses, cannot be 

estimated. However, it is probable that future losses 

will be incurred given the following:

• The Acquirers’ ability to submit breach notices was 

subject to contractual bar dates that have passed. 

In addition, their entitlement to reimbursement 

for certain third party claims is dependent upon 

those claims having been submitted prior to other 

contractual dates, some of which have also passed. 

However, the Acquirers retain the right to assert 

indemnification claims for losses over the life of 

those loans for which breach notices were timely 

submitted.

• The Acquirers’ retain the right to seek 

reimbursement for losses incurred as a result 

of claims alleging breaches of loan seller 

representations asserted by Fannie Mae or Ginnie 

Mae on or prior to March 19, 2019, for their 

reverse mortgage servicing portfolios (unpaid 

principal balance of $12.9 billion at December 31, 

2015, compared to $14.2 billion at December 31, 

2014).

• The GSEs have the right to assert certain claims 

directly against the Sellers for the mortgage servicing 

portfolios without regard to any contractual claims 

bar date.

• Potential losses could be incurred for failures by 

the Sellers to initiate and pursue foreclosure within 

prescribed timeframes for certain government 

guaranteed loans, resulting in the refusal of the 

guarantor to pay interest owed to the investors. 

Fannie Mae has asserted a claim for $64 million 

of interest curtailments with respect to reverse 

loans. Any amounts paid to Fannie Mae will be 

allocated between the Sellers and the Acquirers. A 

review of the causes of this claimed loss as well as 

an allocation of this loss between the Sellers and the 

Acquirers is in the initial stages.

For all these reasons, the FDIC believes it is likely 

that additional losses will be incurred. However, 

quantifying the contingent liability associated with 

the liabilities to investors and the Acquirers is subject 

to a number of uncertainties, including market 

conditions, the occurrence of borrower defaults and 

resulting foreclosures and losses, and the allocation 

of liability between the Sellers and the Acquirers. 

Because of the uncertainties the FDIC has determined 

that, while additional losses are probable, the amount 

is not currently estimable.

PURCHASE AND ASSUMPTION 

INDEMNIFICATION

In connection with purchase and assumption 

agreements for resolutions, the FDIC, in its 

receivership capacity, generally indemnifies the 

purchaser of a failed institution’s assets and liabilities 

in the event a third party asserts a claim against the 

purchaser unrelated to the explicit assets purchased or 

liabilities assumed at the time of failure. The FDIC, 

in its corporate capacity, is a secondary guarantor if a 

receivership is unable to pay. These indemnifications 

generally extend for a term of six years after the 
FINANCIAL SECTION 103

date of institution failure. The FDIC is unable to 

estimate the maximum potential liability for these 

types of guarantees as the agreements do not specify a 

maximum amount and any payments are dependent 

upon the outcome of future contingent events, the 

nature and likelihood of which cannot be determined 

at this time. During 2015 and 2014, the FDIC, 

in its corporate capacity, made no indemnification 

payments under such agreements, and no amount 

has been accrued in the accompanying financial 

statements with respect to these indemnification 

guarantees.

FDIC GUARANTEED DEBT OF 

STRUCTURED TRANSACTIONS

The FDIC, as receiver, uses three types of structured 

transactions to dispose of certain performing and 

non-performing residential mortgage loans, 

commercial loans, construction loans, and mortgagebacked securities held by the receiverships. The three 

types of structured transactions are limited liability 

companies (LLCs), securitizations, and structured sale 

of guaranteed notes (SSGNs).

Under the LLC structure, the FDIC, in its 

receivership capacity, contributed a pool of assets to 

a newly formed LLC and offered for sale, through 

a competitive bid process, some of the equity in the 

LLC. Since 2009, private investors purchased a 40- to 

50-percent ownership interest in the LLC structures 

for $1.6 billion in cash. The LLCs issued notes of 

$4.4 billion to the receiverships to partially fund the 

purchase of the assets; these notes were guaranteed by 

the FDIC, in its corporate capacity. As of December 

31, 2015, no guaranteed LLC notes remain. The $10 

million outstanding guaranteed LLC note balance as 

of December 31, 2014 was fully paid during 2015.

Securitizations and SSGNs (collectively, trusts) are 

transactions in which certain assets or securities 

from failed institutions are pooled and transferred 

into a trust structure. The trusts issue senior and/

or subordinated debt instruments and owner trust or 

residual certificates collateralized by the underlying 

mortgage-backed securities or loans.

Since 2010, private investors purchased the senior 

notes issued by the trusts for $6.2 billion in cash 

and the receiverships hold the subordinated debt 

instruments and owner trust or residual certificates. 

In exchange for a fee, the FDIC, in its corporate 

capacity, guarantees the timely payment of principal 

and interest due on the senior notes, the latest 

maturity of which is 2050. If the FDIC is required to 

perform under its guarantees, it acquires an interest 

in the cash flows of the trust equal to the amount of 

guarantee payments made plus accrued interest. The 

subordinated note holders and owner trust or residual 

certificate holders receive cash flows from the entity 

only after all expenses have been paid, the guaranteed 

notes have been satisfied, and the FDIC has been 

reimbursed for any guarantee payments.

All Structured Transactions with 

FDIC Guaranteed Debt

Through December 31, 2015, the receiverships 

have transferred a portfolio of loans with an unpaid 

principal balance of $16.4 billion and mortgagebacked securities with a book value of $8.8 billion 

to 14 LLCs and 11 trusts. The LLCs and trusts 

subsequently issued notes guaranteed by the FDIC 

in an original principal amount of $10.6 billion. 

Since March 2013, there have been no new guarantee 

transactions. As of December 31, 2015 and 2014, 

the DIF collected guarantee fees totaling $265 

million and $250 million, respectively, and recorded 

a receivable for additional guarantee fees of $26 

million and $42 million, respectively, included in the 

“Interest receivable on investments and other assets, 

net” line item on the Balance Sheet. All guarantee 

fees are recorded as deferred revenue, included in 

the “Accounts payable and other liabilities” line item 

on the Balance Sheet, and recognized as revenue 

primarily on a straight-line basis over the term of 

the notes. As of December 31, 2015 and 2014, the 

amount of deferred revenue recorded was $26 million 

and $42 million, respectively. The DIF records no 

other structured transaction-related assets or liabilities 

on its balance sheet.
104 FEDERAL DEPOSIT INSURANCE CORPORATION

The estimated loss to the DIF from the guarantees 

is derived from an analysis of the net present value 

(using a discount rate of 3.7 percent) of the expected 

guarantee payments by the FDIC, reimbursements 

to the FDIC for guarantee payments, and guarantee 

fee collections. As of December 31, 2015, it is 

reasonably possible that the DIF could be required 

to make guarantee payments totaling $25 million 

for an SSGN transaction beginning in November 

2019 through note maturity in December 2020, 

compared to $29 million estimated as of December 

31, 2014. Any guarantee payment made would be 

fully reimbursed from the proceeds of the liquidation 

of the SSGN’s underlying collateral. For all of the 

remaining transactions, the estimated cash flows from 

the trust assets provide sufficient coverage to fully 

pay the debts. To date, the FDIC, in its corporate 

capacity, has not provided, and does not intend to 

provide, any form of financial or other type of support 

for structured transactions that it was not previously 

contractually required to provide.

As of December 31, 2015 and 2014, the maximum 

loss exposure was zero and $10 million for LLCs and 

$1.6 billion and $2.1 billion for trusts, respectively, 

representing the sum of all outstanding debt 

guaranteed by the FDIC.

9. ASSESSMENTS

The FDIC deposit insurance assessment system is 

mandated by section 7 of the FDI Act and governed 

by part 327 of title 12 of the Code of Federal 

Regulations. The risk-based system requires the 

payment of quarterly assessments by all IDIs.

In response to the Dodd-Frank Act, the FDIC 

implemented several changes to the assessment system 

and developed a comprehensive, long-term fund 

management plan. The plan is designed to restore 

and maintain a positive fund balance for the DIF even 

during a banking crisis and achieve moderate, steady 

assessment rates throughout any economic cycle. 

Summarized below are actions taken to implement 

reforms of the assessment system and provisions of the 

comprehensive plan.

• The FDIC adopted a Restoration Plan to ensure 

that the ratio of the DIF fund balance to estimated 

insured deposits (reserve ratio) reaches 1.35 percent 

by September 30, 2020, in lieu of the previous 

target of 1.15 percent by the end of 2016. The 

FDIC updates, at least semiannually, its loss and 

income projections for the fund and, if needed, 

increases or decreases assessment rates, following 

notice-and-comment rulemaking, if required.

• The FDIC Board of Directors designates a reserve 

ratio for the DIF and publishes the designated 

reserve ratio (DRR) before the beginning of 

each calendar year, as required by the FDI Act. 

Accordingly, in October 2015, the FDIC adopted 

a final rule maintaining the DRR at 2 percent for 

2016. The DRR is an integral part of the FDIC’s 

comprehensive, long-term management plan for the 

DIF and is viewed as a long-range, minimum target 

for the reserve ratio.

• The FDIC adopted a final rule that suspends 

dividends indefinitely, and, in lieu of dividends, 

adopts lower assessment rate schedules when the 

reserve ratio reaches 1.15 percent, 2 percent, and 

2.5 percent.

When the reserve ratio reaches 1.15 percent, lower 

regular assessment rates for all IDIs will go into effect. 

Additionally, upon reaching 1.15 percent, the DoddFrank Act requires that the FDIC offset the effect 

of increasing the minimum reserve ratio from 1.15 

percent to 1.35 percent on IDIs with less than $10 

billion in total consolidated assets. To implement the 

requirement, the FDIC issued a proposed rulemaking 

on October 22, 2015, to add a surcharge to the 

regular quarterly assessments of IDIs with $10 billion 

or more in assets. Under the proposed rule:

• The surcharge would generally equal an annual rate 

of 4.5 basis points applied to the assessment base 

(with certain adjustments), begin in the quarter 

after the reserve ratio first reaches or exceeds 

1.15 percent, and continue for an estimated 

eight quarters.

• The FDIC would provide assessment credits to 

IDIs with total assets of less than $10 billion for 
FINANCIAL SECTION 105

the portion of their assessments that contributed 

to the growth in the reserve ratio between 1.15 

percent and 1.35 percent to ensure that the effect 

of reaching 1.35 percent is fully borne by the 

larger institutions. Assessment credits would be 

available as an offset to an institution’s future regular 

assessment premiums.

• The FDIC would impose a shortfall assessment 

on the larger institutions in order to achieve the 

minimum reserve ratio of 1.35 percent by the 

September 30, 2020 statutory deadline, in the event 

the reserve ratio is greater than 1.15 percent but has 

not reached 1.35 percent by the end of 2018.

ASSESSMENT REVENUE

Annual assessment rates averaged approximately 6.6 

cents per $100 of the assessment base for 2015 and 

2014, respectively. The assessment base is generally 

defined as the average consolidated total assets minus 

the average tangible equity (measured as Tier 1 

capital) of the IDI during the assessment period.

The “Assessments receivable, net” line item on 

the Balance Sheet of $2.2 billion and $2.0 billion 

represents the estimated premiums due from IDIs for 

the fourth quarter of 2015 and 2014, respectively. 

The actual deposit insurance assessments for the 

fourth quarter of 2015 will be billed and collected at 

the end of the first quarter of 2016. During 2015 and 

2014, $8.8 billion and $8.7 billion, respectively, were 

recognized as assessment revenue from institutions.

RESERVE RATIO

As of September 30, 2015 and December 31, 2014, 

the DIF reserve ratio was 1.09 percent and 1.01 

percent, respectively, of estimated insured deposits.

ASSESSMENTS RELATED TO FICO

Assessments continue to be levied on institutions 

for payments of the interest on obligations issued 

by the Financing Corporation (FICO). The FICO 

was established as a mixed-ownership government 

corporation to function solely as a financing vehicle 

for the former FSLIC. The annual FICO interest 

obligation of approximately $790 million is paid on 

a pro rata basis using the same rate for banks and 

thrifts. The FICO assessment has no financial impact 

on the DIF and is separate from deposit insurance 

assessments. The FDIC, as administrator of the DIF, 

acts solely as a collection agent for the FICO. As of 

December 31, 2015 and 2014, approximately $798 

million and $793 million, respectively, was collected 

and remitted to the FICO.

10. OPERATING EXPENSES

The “Operating expenses” line item on the Statement 

of Income and Fund Balance consisted of the 

following components (in thousands).

December 31

2015

December 31

2014

Salaries and benefits $1,248,146 $1,252,167

Outside services 280,050 263,649

Travel 97,819 93,720

Buildings and leased space 90,945 96,596

Software/Hardware 

maintenance 62,604 58,844

Depreciation of property 

and equipment 52,233 59,634

Other 28,314 28,999

Subtotal 1,860,111 1,853,609

Less: Expenses billed to 

resolution entities (172,877) (189,265)

Total $1,687,234 $1,664,344

11. PROVISION FOR 

INSURANCE LOSSES

The provision for insurance losses was a negative $2.3 

billion for 2015, compared to negative $8.3 billion 

for 2014. The negative provision for 2015 primarily 

resulted from a decrease of $2.2 billion in the 

estimated losses for institutions that failed in current 

and prior years.
106 FEDERAL DEPOSIT INSURANCE CORPORATION

As described in Note 4, the estimated recoveries 

from assets held by receiverships and estimated 

payments related to assets sold by receiverships to 

acquiring institutions under shared-loss agreements 

(SLAs) are used to derive the loss allowance on 

the receivables from resolutions. The $2.2 billion 

decrease in the estimated losses from failures was 

primarily attributable to four components. The first 

component was unanticipated recoveries of $1.0 

billion in litigation settlements, professional liability 

claims, and tax refunds by the receiverships. These are 

typically not recognized until the cash is received since 

significant uncertainties surround their recovery.

The second component of the reduction in the 

estimated losses from failures was a $1.4 billion 

decrease in the receiverships’ shared-loss liability. 

In 2015, covered asset balances decreased by $23.1 

billion as a result of loan amortizations and paydowns, as well as the expiration of 113 commercial 

shared-loss agreements and the early termination of 66 

shared-loss agreements. Actual losses on this portion 

of covered assets were less than estimated at year-end 

2014. The composition of the remaining covered 

asset portfolio primarily consists of performing single 

family assets, which have historically experienced 

significantly lower losses than commercial assets.

The remaining components consisted of an increase 

in the estimated losses from failures of $715 million 

that resulted from an increase in receivership legal and 

representation and warranty liabilities and projected 

future receivership expenses, as well as an adjustment 

of $501 million for lower-than-anticipated loss 

estimates at time of failure for all current year 

failures. The net effect of these two components was 

an increase of $214 million to estimated losses from 

failures.

12. EMPLOYEE BENEFITS

PENSION BENEFITS AND SAVINGS PLANS

Eligible FDIC employees (permanent and term 

employees with appointments exceeding one year) are 

covered by the federal government retirement plans, 

either the Civil Service Retirement System (CSRS) or 

the Federal Employees Retirement System (FERS). 

Although the DIF contributes a portion of pension 

benefits for eligible employees, it does not account 

for the assets of either retirement system. The DIF 

also does not have actuarial data for accumulated 

plan benefits or the unfunded liability relative to 

eligible employees. These amounts are reported on 

and accounted for by the U.S. Office of Personnel 

Management (OPM).

Under the Federal Thrift Savings Plan (TSP), the 

FDIC provides FERS employees with an automatic 

contribution of 1 percent of pay and an additional 

matching contribution up to 4 percent of pay. CSRS 

employees also can contribute to the TSP, but they 

do not receive agency matching contributions. 

Eligible FDIC employees may also participate in an 

FDIC-sponsored tax-deferred 401(k) savings plan 

with matching contributions up to 5 percent. The 

expenses for these plans are presented in the table 

below (in thousands).

December 31

2015

December 31

2014

Civil Service 

Retirement System $3,949 $4,698

Federal Employees 

Retirement System 

(Basic Benefit) 108,056 99,954

Federal Thrift Savings 

Plan 35,140 35,144

FDIC Savings Plan 39,767 37,304

Total $186,912 $177,100

POSTRETIREMENT BENEFITS 

OTHER THAN PENSIONS

The DIF has no postretirement health insurance 

liability since all eligible retirees are covered by the 

Federal Employees Health Benefits (FEHB) program. 

The FEHB is administered and accounted for by the 

OPM. In addition, OPM pays the employer share of 

the retiree’s health insurance premiums.
FINANCIAL SECTION 107

The FDIC provides certain life and dental insurance 

coverage for its eligible retirees, the retirees’ 

beneficiaries, and covered dependents. Retirees 

eligible for life and dental insurance coverage are those 

who have qualified due to (1) immediate enrollment 

upon appointment or five years of participation in 

the plan and (2) eligibility for an immediate annuity. 

The life insurance program provides basic coverage 

at no cost to retirees and allows converting optional 

coverage to direct-pay plans. For the dental coverage, 

retirees are responsible for a portion of the premium.

The FDIC has elected not to fund the postretirement 

life and dental benefit liabilities. As a result, 

the DIF recognized the underfunded status (the 

difference between the accumulated postretirement 

benefit obligation and the plan assets at fair value) 

as a liability. Since there are no plan assets, the 

plan’s benefit liability is equal to the accumulated 

postretirement benefit obligation.

Postretirement benefit obligation, gain and loss, and 

expense information included in the Balance Sheet 

and Statement of Income and Fund Balance are 

summarized as follows (in thousands).

December 31 

2015

December 31

2014

Accumulated postretirement benefit obligation recognized in 

Postretirement benefit liability $233,000 $243,419

Amounts recognized in accumulated other comprehensive income: 

Unrealized postretirement benefit loss

Cumulative net actuarial loss $(31,938) $(55,131)

Prior service cost (2,110) (2,620)

Total $(34,048) $(57,751)

Amounts recognized in other comprehensive income: 

Unrealized postretirement benefit gain (loss)

Actuarial gain (loss) $23,193 $(41,527)

Prior service credit 510 126

Total $23,703 $(41,401)

Net amortization out of other comprehensive income 

included in net periodic benefit cost $3,842 $126
108 FEDERAL DEPOSIT INSURANCE CORPORATION

Expected amortization of accumulated other 

comprehensive income into net periodic benefit 

cost is summarized as follows (in thousands).

December 31, 2016

Prior service costs $575

Net actuarial loss 992

Total $1,567

The annual postretirement contributions and benefits 

paid are included in the table below (in thousands).

December 31 

2015

December 31 

2014

Employer contributions $6,064 $5,579

Plan participants’ 

contributions $728 $655

Benefits paid $(6,792) $(6,234)

The expected contributions for the period ending 

December 31, 2016, are $7.1 million. Expected 

future benefit payments for each of the next 10 years 

are presented in the following table (in thousands).

2016 2017 2018 2019 2020

2021-

2025

$6,388 $6,954 $7,488 $8,006 $8,563 $51,276

Assumptions used to determine the amount of the 

accumulated postretirement benefit obligation and the 

net periodic benefit costs are summarized as follows 

(in thousands).

December 31 

2015

December 31 

2014

Discount rate for 

future benefits 

(benefit obligation) 4.29% 4.00%

Rate of compensation 

increase 3.70% 3.80%

Discount rate 

(benefit cost) 4.00% 4.75%

Dental health care 

cost-trend rate

Assumed for next year 4.70% 4.90%

Ultimate 4.50% 4.50%

Year rate will 

reach ultimate 2017 2016

13. COMMITMENTS AND OFFBALANCE-SHEET EXPOSURE

COMMITMENTS:

Leased Space

The DIF leased space expense totaled $47 million and 

$56 million for 2015 and 2014, respectively. The 

FDIC’s lease commitments total $206 million for 

future years. The lease agreements contain escalation 

clauses resulting in adjustments, usually on an annual 

basis. Future minimum lease commitments are as 

follows (in thousands).

2016 2017 2018 2019 2020

2021/

Thereafter

$50,097 $45,510 $32,196 $27,558 $14,151 $36,245

OFF-BALANCE-SHEET EXPOSURE:

Deposit Insurance

Estimates of insured deposits are derived primarily 

from quarterly financial data submitted by IDIs to the 

FDIC and represent the accounting loss that would be 

realized if all IDIs were to fail and the acquired assets 

provided no recoveries. As of September 30, 2015 

and December 31, 2014, estimated insured deposits 

for the DIF were $6.4 trillion and $6.2 trillion, 

respectively.

14. DISCLOSURES ABOUT THE

FAIR VALUE OF FINANCIAL 

INSTRUMENTS

Financial assets recognized and measured at 

fair value on a recurring basis at each reporting date 

include cash equivalents (see Note 2) and 

the investment in U.S. Treasury obligations 

(see Note 3). The DIF’s financial assets measured 

at fair value consisted of the following components 

(in thousands).
FINANCIAL SECTION 109

Quoted Prices 

in Active 

Markets for Identical 

Assets

(Level 1)

Significant 

Other

Observable 

Inputs

(Level 2)

Significant

Unobservable 

Inputs

(Level 3)

Total 

Assets

at Fair 

Value

Assets

Cash equivalents1 $ 861,712 $ 861,712

Available-for-Sale Debt Securities

Investment in U.S. Treasury Obligations2 62,496,959 62,496,959

Total Assets $63,358,671 $0 $0 $63,358,671

1

 Cash equivalents are Special U.S. Treasury Certificates with overnight maturities valued at prevailing interest rates established by the Bureau of 

the Fiscal Service.

2

 The investment in U.S. Treasury obligations is measured based on prevailing market yields for federal government entities.

December 31, 2015

Quoted Prices 

in Active 

Markets for Identical 

Assets

(Level 1)

Significant 

Other

Observable 

Inputs

(Level 2)

Significant

Unobservable 

Inputs

(Level 3)

Total 

Assets

at Fair 

Value

Assets

Cash equivalents1 $ 1,900,105 $1,900,105

Available-for-Sale Debt Securities

Investment in U.S. Treasury Obligations2 49,805,846 49,805,846

Total Assets $51,705,951 $0 $0 $51,705,951

1

 Cash equivalents are Special U.S. Treasury Certificates with overnight maturities valued at prevailing interest rates established by the Bureau of 

the Fiscal Service.

2

 The investment in U.S. Treasury obligations is measured based on prevailing market yields for federal government entities.

December 31, 2014

Some of the DIF’s financial assets and liabilities 

are not recognized at fair value but are recorded at 

amounts that approximate fair value due to their short 

maturities and/or comparability with current interest 

rates. Such items include assessments receivable, 

interest receivable on investments, other short-term 

receivables, and accounts payable and other liabilities.

The net receivables from resolutions primarily include 

the DIF’s subrogated claim arising from obligations 

to insured depositors. The resolution entity assets 

that will ultimately be used to pay the corporate 

subrogated claim are valued using discount rates that 

include consideration of market risk. These discounts 

ultimately affect the DIF’s allowance for loss against 

the receivables from resolutions. Therefore, the 

corporate subrogated claim indirectly includes the 

effect of discounting and should not be viewed as 

being stated in terms of nominal cash flows.

Although the value of the corporate subrogated claim 

is influenced by the valuation of resolution entity 

assets (see Note 4), such valuation is not equivalent 

to the valuation of the corporate claim. Since the 

corporate claim is unique, not intended for sale to the 

private sector, and has no established market, it is not 

practicable to estimate a fair value.

The FDIC believes that a sale to the private sector of 

the corporate claim would require indeterminate, but 
110 FEDERAL DEPOSIT INSURANCE CORPORATION

substantial, discounts for an interested party to profit 

from these assets because of credit and other risks. In 

addition, the timing of resolution entity payments 

to the DIF on the subrogated claim does not 

necessarily correspond with the timing of collections 

on resolution entity assets. Therefore, the effect of 

discounting used by resolution entities should not 

necessarily be viewed as producing an estimate of fair 

value for the net receivables from resolutions.

15. INFORMATION RELATING 

TO THE STATEMENT OF 

CASH FLOWS

The following table presents a reconciliation of 

net income to net cash from operating activities 

(in thousands).

16. SUBSEQUENT EVENTS 

Subsequent events have been evaluated through 

February 4, 2016, the date the financial statements are 

available to be issued, and management determined 

that there are no items to disclose.

December 31

2015

December 31

2014

Operating Activities

Net Income: $9,856,688 $15,599,812

Adjustments to reconcile net income to net cash provided

by operating activities:

Amortization of U.S. Treasury obligations 1,411,376 1,387,067

Treasury Inflation-Protected Securities inflation adjustment 12,465 (37,865)

Depreciation on property and equipment 52,233 59,634

Loss on retirement of property and equipment 2,415 465

Provision for insurance losses (2,251,320) (8,305,577)

Unrealized gain (loss) on postretirement benefits 23,703 (41,401)

Change in Assets and Liabilities:

(Increase) Decrease in assessments receivable, net (169,048) 224,311

Decrease (Increase) in interest receivable and other assets 242,128 (137,462)

Decrease in receivables from resolutions 7,425,888 7,077,627

(Decrease) in accounts payable and other liabilities (18,435) (9,569)

(Decrease) Increase in postretirement benefit liability (10,419) 49,828

(Decrease) in liabilities due to resolutions (3,380,084) (4,826,703)

Net Cash Provided by Operating Activities $13,197,590 $11,040,167
FINANCIAL SECTION 111

FEDERAL DEPOSIT INSURANCE CORPORATION

FSLIC RESOLUTION FUND BALANCE SHEET AT DECEMBER 31

Dollars in Thousands

2015 2014

Assets

Cash and cash equivalents $871,037 $870,943 

Receivables from U.S. Treasury for goodwill litigation (Note 3) 0 356,455 

Other assets, net 760 904 

Total Assets $871,797 $1,228,302 

Liabilities 

Accounts payable and other liabilities $624 $370 

Contingent liabilities for goodwill litigation (Note 3) 0 356,455 

Total Liabilities 624 356,825 

Resolution Equity (Note 4)

Contributed capital 125,489,317 125,332,156 

Accumulated deficit (124,618,144) (124,460,679)

Total Resolution Equity 871,173 871,477 

Total Liabilities and Resolution Equity $871,797 $1,228,302 

The accompanying notes are an integral part of these financial statements.

FSLIC RESOLUTION FUND (FRF)
112 FEDERAL DEPOSIT INSURANCE CORPORATION

FEDERAL DEPOSIT INSURANCE CORPORATION

FSLIC RESOLUTION FUND STATEMENT OF INCOME AND 

ACCUMULATED DEFICIT FOR THE YEARS ENDED DECEMBER 31

Dollars in Thousands

2015 2014

Revenue

Interest on U.S. Treasury obligations $298 $229

Other revenue 2,309 948

Total Revenue 2,607 1,177 

Expenses and Losses

Operating expenses 3,064 2,326

Provision for losses (260) (792)

Goodwill litigation expenses (Note 3) 157,161 0

Other expenses 107 171

Total Expenses and Losses 160,072 1,705

Net Loss (157,465) (528)

Accumulated Deficit - Beginning (124,460,679) (124,460,151)

Accumulated Deficit - Ending $(124,618,144) $(124,460,679)

The accompanying notes are an integral part of these financial statements.

FSLIC RESOLUTION FUND (FRF)
FINANCIAL SECTION 113

FEDERAL DEPOSIT INSURANCE CORPORATION

FSLIC RESOLUTION FUND STATEMENT OF CASH FLOWS 

FOR THE YEARS ENDED DECEMBER 31

Dollars in Thousands

2015 2014

Operating Activities

Provided by:

Interest on U.S. Treasury obligations $298 $229

Recoveries from financial institution resolutions 2,555 1,886

Miscellaneous receipts 24 197

Used by:

Operating expenses (2,783) (2,981)

Payments for goodwill litigation (Note 3) (513,616) 0

Net Cash (Used) by Operating Activities (513,522) (669)

Financing Activities

Provided by:

U.S. Treasury payments for goodwill litigation (Note 3) 513,616 0

Net Cash Provided by Financing Activities 513,616 0

Net Increase (Decrease) in Cash and Cash Equivalents 94 (669)

Cash and Cash Equivalents - Beginning 870,943 871,612

Cash and Cash Equivalents - Ending $871,037 $870,943

The accompanying notes are an integral part of these financial statements.

FSLIC RESOLUTION FUND (FRF)
114 FEDERAL DEPOSIT INSURANCE CORPORATION

NOTES TO THE 

FINANCIAL STATEMENTS

FSLIC RESOLUTION FUND

December 31, 2015 and 2014

1. OPERATIONS/DISSOLUTION OF 

THE FSLIC RESOLUTION FUND

OVERVIEW

The Federal Deposit Insurance Corporation (FDIC) 

is the independent deposit insurance agency created 

by Congress in 1933 to maintain stability and public 

confidence in the nation’s banking system. Provisions 

that govern the FDIC’s operations are generally 

found in the Federal Deposit Insurance (FDI) Act, 

as amended (12 U.S.C. 1811, et seq). In accordance 

with the FDI Act, the FDIC, as administrator of the 

Deposit Insurance Fund (DIF), insures the deposits 

of banks and savings associations (insured depository 

institutions). In cooperation with other federal and 

state agencies, the FDIC promotes the safety and 

soundness of insured depository institutions (IDIs) 

by identifying, monitoring, and addressing risks to 

the DIF.

In addition to being the administrator of the DIF, the 

FDIC is the administrator of the FSLIC Resolution 

Fund (FRF). As such, the FDIC is responsible for the 

sale of remaining assets and satisfaction of liabilities 

associated with the former Federal Savings and Loan 

Insurance Corporation (FSLIC) and the former 

Resolution Trust Corporation (RTC). The FDIC 

maintains the DIF and the FRF separately to support 

their respective functions.

The FSLIC was created through the enactment of 

the National Housing Act of 1934. The Financial 

Institutions Reform, Recovery, and Enforcement Act 

of 1989 (FIRREA) abolished the insolvent FSLIC and 

created the FRF. At that time, the assets and liabilities 

of the FSLIC were transferred to the FRF – except 

those assets and liabilities transferred to the newly 

created RTC – effective on August 9, 1989. Further, 

the FIRREA established the Resolution Funding 

Corporation (REFCORP) to provide part of the 

initial funds used by the RTC for thrift resolutions.

The RTC Completion Act of 1993 terminated the 

RTC as of December 31, 1995. All remaining assets 

and liabilities of the RTC were transferred to the FRF 

on January 1, 1996. Today, the FRF consists of two 

distinct pools of assets and liabilities: one composed 

of the assets and liabilities of the FSLIC transferred 

to the FRF upon the dissolution of the FSLIC (FRFFSLIC), and the other composed of the RTC assets 

and liabilities (FRF-RTC). The assets of one pool are 

not available to satisfy obligations of the other.

OPERATIONS/DISSOLUTION OF THE FRF

The FRF will continue operations until all of its assets 

are sold or otherwise liquidated and all of its liabilities 

are satisfied. Any funds remaining in the FRF-FSLIC 

will be paid to the U.S. Treasury. Any remaining 

funds of the FRF-RTC will be distributed to the 

REFCORP to pay the interest on the REFCORP 

bonds. In addition, the FRF-FSLIC has available 

until expended $602 million in appropriations to 

facilitate, if required, efforts to wind up the resolution 

activity of the FRF-FSLIC.

The FDIC has extensively reviewed and cataloged 

the FRF’s remaining assets and liabilities. Some of 

the unresolved issues are:

• criminal restitution orders (generally have from 1 to 

17 years remaining to enforce);

• collections of settlements and judgments obtained 

against officers and directors and other professionals 

responsible for causing or contributing to thrift 
FINANCIAL SECTION 115

losses (generally have up to 7 years remaining to 

enforce, unless the judgments are renewed or are 

covered by the Federal Debt Collections Procedures 

Act, which will result in significantly longer periods 

for collection of some judgments);

• liquidation/disposition of residual assets purchased 

by the FRF from terminated receiverships;

• three remaining issues related to assistance 

agreements entered into by the former FSLIC (FRF 

could continue to receive or refund overpayments of 

tax benefits sharing in future years);

• goodwill litigation (reimbursement of a potential tax 

liability; see Note 3); and

• affordable housing disposition program monitoring 

(the last agreement expires no later than 2045; see 

Note 3).

The FRF could realize recoveries from tax benefits 

sharing, criminal restitution orders, and professional 

liability claims. However, any potential recoveries are 

not reflected in the FRF’s financial statements, given 

the significant uncertainties surrounding the ultimate 

outcome.

On April 1, 2014, the FDIC concluded its role 

as receiver of FRF receiverships when the last 

active receivership was terminated. In total, 850 

receiverships were liquidated by the FRF and the 

RTC. To facilitate receivership terminations, the 

FRF, in its corporate capacity, acquired the remaining 

receivership assets. These assets are included in the 

“Other assets, net” line item on the Balance Sheet.

During the years of receivership activity, the assets 

held by receivership entities, and the claims against 

them, were accounted for separately from the FRF’s 

assets and liabilities to ensure that receivership 

proceeds were distributed in accordance with 

applicable laws and regulations. Also, the income and 

expenses attributable to receiverships were accounted 

for as transactions of those receiverships. The FDIC 

billed receiverships for services provided on their 

behalf.

2. SUMMARY OF SIGNIFICANT 

ACCOUNTING POLICIES

GENERAL

The financial statements include the financial 

position, results of operations, and cash flows of 

the FRF and are presented in accordance with U.S. 

generally accepted accounting principles (GAAP). 

During the years of receivership activity, these 

statements did not include reporting for assets and 

liabilities of receivership entities because these entities 

were legally separate and distinct, and the FRF did 

not have any ownership or beneficial interest in them.

The FRF is a limited-life entity, however, it does 

not meet the requirements for presenting financial 

statements using the liquidation basis of accounting. 

According to Accounting Standards Codification 

Topic 205, Presentation of Financial Statements, a 

limited-life entity should apply the liquidation basis of 

accounting only if a change in the entity’s governing 

plan has occurred since its inception. By statute, the 

FRF is a limited-life entity whose dissolution will 

occur upon the satisfaction of all liabilities and the 

disposition of all assets. No changes to this statutory 

plan have occurred since inception of the FRF.

USE OF ESTIMATES

The preparation of the financial statements in 

conformity with GAAP requires management to make 

estimates and assumptions that affect the reported 

amounts of assets and liabilities, revenue and expenses, 

and disclosure of contingent liabilities. Actual 

results could differ from these estimates. Where it 

is reasonably possible that changes in estimates will 

cause a material change in the financial statements in 

the near term, the nature and extent of such potential 

changes in estimates have been disclosed. The more 

significant estimates include the valuation of other 

assets and the estimated losses for litigation.
116 FEDERAL DEPOSIT INSURANCE CORPORATION

CASH EQUIVALENTS

Cash equivalents are short-term, highly liquid 

investments consisting primarily of U.S. Treasury 

Overnight Certificates.

PROVISION FOR LOSSES

The provision for losses represents the change in the 

estimated losses related to other assets.

RELATED PARTIES

The nature of related parties and a description of 

related party transactions are discussed in Note 1 

and disclosed throughout the financial statements 

and footnotes.

DISCLOSURE ABOUT RECENT RELEVANT 

ACCOUNTING PRONOUNCEMENTS

Recent accounting pronouncements have been 

deemed not applicable or material to the financial 

statements as presented.

3. CONTINGENT LIABILITIES

GOODWILL LITIGATION

In United States v. Winstar Corp., 518 U.S. 839 

(1996), the Supreme Court held that when it became 

impossible following the enactment of FIRREA in 

1989 for the federal government to perform certain 

agreements to count goodwill toward regulatory 

capital, the plaintiffs were entitled to recover 

damages from the United States. The contingent 

liability associated with the nonperformance of these 

agreements was transferred to the FRF on August 9, 

1989, upon the dissolution of the FSLIC.

The FRF can draw from an appropriation provided 

by Section 110 of the Department of Justice 

Appropriations Act, 2000 (Public Law 106-113, 

Appendix A, Title I, 113 Stat. 1501A-3, 1501A20) such sums as may be necessary for the payment 

of judgments and compromise settlements in the 

goodwill litigation. This appropriation is to remain 

available until expended.

Because an appropriation is available to pay such 

judgments and settlements, any estimated liability 

for goodwill litigation will have a corresponding 

receivable from the U.S. Treasury and therefore have 

no net impact on the financial condition of the FRF.

In December 2015, the FRF paid $513.6 million 

to resolve the remaining active goodwill case using 

appropriations received from the U.S. Treasury. 

During 2015, the United States Court of Federal 

Claims awarded the plaintiff additional mitigation 

damages and estimated tax liabilities. These awards 

were in addition to the previous award of $356.4 

million, for which the FRF had recorded a contingent 

liability and offsetting receivable as of December 31, 

2014. For another case fully adjudicated in 2012, 

an estimated loss of $8 million for the court-ordered 

reimbursement of potential tax liabilities to the 

plaintiff is reasonably possible.

In addition, the FRF-FSLIC pays the goodwill 

litigation expenses incurred by the Department of 

Justice (DOJ), the entity that defends these lawsuits 

against the United States, based on a Memorandum 

of Understanding (MOU) dated October 2, 1998, 

between the FDIC and the DOJ. The FRF-FSLIC 

pays in advance the estimated goodwill litigation 

expenses. Any unused funds are carried over and 

applied toward the next fiscal year (FY) charges. The 

FRF-FSLIC did not provide any additional funding to 

the DOJ in either 2015 or 2014 because the unused 

funds from prior fiscal years were sufficient to cover 

estimated expenses.

OTHER CONTINGENCIES

Paralleling the goodwill cases were similar cases 

alleging that the government breached agreements 

regarding tax benefits associated with certain FSLICassisted acquisitions. All eight of those cases have 

been settled. However, a case settled in 2006 further 

obligates the FRF-FSLIC as a guarantor for all tax 

liabilities in the event the settlement amount is 

determined by tax authorities to be taxable. The 

maximum potential exposure under this guarantee 

is approximately $100 million. However, the FDIC 

believes that it is very unlikely the settlement will be 
FINANCIAL SECTION 117

subject to taxation. The entity’s federal income tax 

return for the 2006 taxable year has been amended 

and remains subject to examination by the Internal 

Revenue Service (IRS). To date, there has been no 

assertion by the IRS of taxation for an issue covered 

by the guarantee. As of December 31, 2015 and 

2014, no contingent liability has been recorded, and 

the FRF does not expect to fund any payment under 

this guarantee.

FANNIE MAE GUARANTEE

On May 21, 2012, the FDIC, in its capacity as 

administrator of the FRF, entered into an agreement 

with Fannie Mae for the release of $13 million of 

credit enhancement reserves to the FRF in exchange 

for indemnifying Fannie Mae from all future losses 

incurred on 76 multi-family mortgage loans. The 

former RTC supplied Fannie Mae with the credit 

enhancement reserves in the form of cash collateral to 

cover future losses on these mortgage loans through 

2020. Based on the most current data available, as 

of September 30, 2015, the maximum exposure on 

this indemnification is the current unpaid principal 

balance of the remaining 45 multi-family loans 

totaling $3.7 million. Based on a contingent liability 

assessment of this portfolio as of September 30, 

2015, the majority of the loans are at least 81 percent 

amortized, and all are scheduled to mature within one 

to five years. Since all of the loans are performing and 

no losses have occurred since 2001, future payments 

on this indemnification are not expected. No 

contingent liability for this indemnification has been 

recorded as of December 31, 2015 and 2014.

AFFORDABLE HOUSING 

DISPOSITION PROGRAM

Required by FIRREA under section 501, the 

Affordable Housing Disposition Program (AHDP) 

was established in 1989 to ensure the preservation 

of affordable housing for low-income households. 

The FDIC, in its capacity as administrator of the 

FRF-RTC, assumed responsibility for monitoring 

property owner compliance with land use restriction 

agreements (LURAs). To enforce the property owners’ 

LURA obligation, the RTC, prior to its dissolution, 

entered into Memoranda of Understanding with 28 

monitoring agencies to oversee these LURAs. The 

FDIC, through the FRF, has agreed to indemnify the 

monitoring agencies for all losses related to LURA 

legal enforcement proceedings.

Since 2006, the FDIC entered into two litigations 

against property owners and paid $23 thousand 

in legal expenses, which was fully reimbursed due 

to successful litigation. The maximum potential 

exposure to the FRF cannot be estimated as it 

is contingent upon future legal proceedings. 

However, loss mitigation factors include: (1) the 

indemnification may become void if the FDIC is 

not immediately informed upon receiving notice of 

any legal proceedings and (2) the FDIC is entitled 

to reimbursement of any legal expenses incurred for 

successful litigation against a property owner. AHDP 

guarantees will continue until the termination of the 

last LURA, or 2045 (whichever occurs first). As of 

December 31, 2015 and 2014, no contingent liability 

for this indemnification has been recorded.

4. RESOLUTION EQUITY

As stated in the Overview section of Note 1, the FRF 

is composed of two distinct pools: the FRF-FSLIC 

and the FRF-RTC. The FRF-FSLIC consists of the 

assets and liabilities of the former FSLIC. The FRFRTC consists of the assets and liabilities of the former 

RTC. Pursuant to legal restrictions, the two pools are 

maintained separately and the assets of one pool are 

not available to satisfy obligations of the other.

Contributed capital, accumulated deficit, and 

resolution equity consisted of the following 

components by each pool (in thousands).
118 FEDERAL DEPOSIT INSURANCE CORPORATION

CONTRIBUTED CAPITAL

The FRF-FSLIC and the former RTC received $43.5 

billion and $60.1 billion from the U.S. Treasury, 

respectively, to fund losses from thrift resolutions 

prior to July 1, 1995. Additionally, the FRFFSLIC issued $670 million in capital certificates 

to the Financing Corporation (a mixed-ownership 

government corporation established to function 

solely as a financing vehicle for the FSLIC) and the 

RTC issued $31.3 billion of these instruments to 

the REFCORP. FIRREA prohibited the payment of 

dividends on any of these capital certificates.

The FRF-FSLIC received $513.6 million in U.S. 

Treasury payments for goodwill litigation in 2015, 

of which $356.4 million was accrued as a receivable 

at year-end 2014. The $157.2 million difference 

increased contributed capital in 2015. Through 

December 31, 2015, the FRF received a total of $2.3 

billion in goodwill appropriations, the effect of which 

increased contributed capital.

Through December 31, 2015, the FRF-RTC had 

returned $4.6 billion to the U.S. Treasury and made 

payments of $5.1 billion to the REFCORP. The 

most recent payment to the REFCORP was in July 

of 2013 for $125 million. In addition, the FDIC 

returned $2.6 billion to the U.S. Treasury on behalf 

of the FRF-FSLIC in 2013. These actions reduced 

contributed capital.

ACCUMULATED DEFICIT

The accumulated deficit represents the cumulative 

excess of expenses and losses over revenue for activity 

related to the FRF-FSLIC and the FRF-RTC. 

Approximately $29.8 billion and $87.9 billion were 

brought forward from the former FSLIC and the 

former RTC on August 9, 1989, and January 1, 1996, 

respectively. Since the dissolution dates, the FRFFSLIC accumulated deficit increased by $13.3 billion, 

whereas the FRF-RTC accumulated deficit decreased 

by $6.3 billion.

5. DISCLOSURES ABOUT THE

FAIR VALUE OF FINANCIAL 

INSTRUMENTS

At December 31, 2015 and 2014, the FRF’s financial 

assets measured at fair value on a recurring basis are 

cash equivalents of $828 million and $827 million, 

respectively. Cash equivalents are Special U.S. 

Treasury Certificates with overnight maturities valued 

at prevailing interest rates established by the Bureau 

FRF-FSLIC FRF-RTC

FRF 

Consolidated

Contributed capital - beginning $43,707,819 $81,624,337 $125,332,156

Contributed capital - ending 43,707,819 81,624,337 125,332,156

Accumulated deficit (42,879,590) (81,581,089) (124,460,679)

Total Resolution Equity $828,229 $43,248 $871,477

FRF-FSLIC FRF-RTC

FRF 

Consolidated

Contributed capital - beginning $43,707,819 $81,624,337 $125,332,156

Add: U.S.Treasury payment in excess of prior year receivable 157,161 0 157,161

Contributed capital - ending 43,864,980 81,624,337 125,489,317

Accumulated deficit (43,036,684) (81,581,460) (124,618,144)

Total Resolution Equity $828,296 $42,877 $871,173

December 31, 2015

December 31, 2014
FINANCIAL SECTION 119

of the Fiscal Service. The valuation is considered 

a Level 1 measurement in the fair value hierarchy, 

representing quoted prices in active markets for 

identical assets.

Some of the FRF’s financial assets and liabilities 

are not recognized at fair value but are recorded at 

amounts that approximate fair value due to their short 

maturities and/or comparability with current interest 

rates. Such items include receivables from the U.S. 

Treasury for goodwill litigation and accounts payable 

and other liabilities.

Assets purchased by the FRF from terminated 

receiverships (see Note 1) and included in the 

“Other assets, net” line item on the Balance Sheet are 

primarily valued using projected cash flow analyses; 

however, these valuations do not represent an estimate 

of fair value. These assets (ranging in age between 21 

to 26 years), could not be liquidated during the life of 

the receiverships due to restrictive clauses and other 

impediments. Because these impediments remain, 

there is no market for these assets. Consequently, it is 

not practicable to provide an estimate of fair value.

6. INFORMATION RELATING 

TO THE STATEMENT OF 

CASH FLOWS

The following table presents a reconciliation of 

net loss to net cash from operating activities 

(in thousands)

December 31 

2015

December 31

2014

Operating Activities

Net Loss: $(157,465) $(528)

Adjustments to reconcile net loss to net cash (used)

by operating activities:

Provision for losses (260) (792)

Change in Assets and Liabilities:

Decrease in other assets 404 1,071

Increase (Decrease) in accounts payable and other liabilities 254 (420)

(Decrease) in contingent liabilities for goodwill litigation (356,455) 0

Net Cash (Used) by Operating Activities $(513,522) $(669)

7. SUBSEQUENT EVENTS 

Subsequent events have been evaluated through 

February 4, 2016, the date the financial statements are 

available to be issued, and management determined 

that there are no items to disclose.
120 FEDERAL DEPOSIT INSURANCE CORPORATION

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT
FINANCIAL SECTION 121

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
122 FEDERAL DEPOSIT INSURANCE CORPORATION

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
FINANCIAL SECTION 123

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
124 FEDERAL DEPOSIT INSURANCE CORPORATION

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
FINANCIAL SECTION 125

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
126 FEDERAL DEPOSIT INSURANCE CORPORATION

GOVERNMENT ACCOUNTABILITY OFFICE AUDITOR’S REPORT 

(continued)
FINANCIAL SECTION 127

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER 

FINANCIAL REPORTING

Appendix I
128 FEDERAL DEPOSIT INSURANCE CORPORATION

MANAGEMENT’S RESPONSE TO THE AUDITOR’S REPORT

Appendix II
VI. CORPORATE MANAGEMENT 

CONTROL

129

VI.

Corporate 

Management 

Control
THIS PAGE INTENTIONALLY LEFT BLANK
CORPORATE MANAGEMENT CONTROL 131

The FDIC uses several means to maintain 

comprehensive internal controls, ensure the overall 

effectiveness and efficiency of operations, and 

otherwise comply as necessary with the following 

federal standards, among others:

• Chief Financial Officers’ Act (CFO Act)

• Federal Managers’ Financial Integrity Act (FMFIA)

• Federal Financial Management Improvement Act 

(FFMIA)

• Government Performance and Results Act (GPRA)

• Federal Information Security Management Act 

(FISMA)

• OMB Circular A-123

• GAO’s Standards for Internal Control in the Federal 

Government

As a foundation for these efforts, the Division of 

Finance Corporate Management Control Branch 

oversees a corporate-wide program of relevant 

activities by establishing policies and working with 

management in each division and office in the FDIC. 

The FDIC has made a concerted effort to ensure that 

financial, reputational, and operational risks have been 

identified and that corresponding control needs are 

being incorporated into day-to-day operations. The 

program also requires that comprehensive procedures 

be documented, employees be thoroughly trained, 

and supervisors be held accountable for performance 

and results. Compliance monitoring is carried out 

through periodic management reviews and by the 

distribution of various activity reports to all levels of 

management. Conscientious attention is also paid to 

the implementation of audit recommendations made 

by the FDIC Office of the Inspector General, the 

GAO, and other providers of external/audit scrutiny. 

The FDIC has received unmodified/unqualified 

opinions on its financial statement audits for 24 

consecutive years, and these and other positive results 

reflect the effectiveness of the overall management 

control program.

In 2015, efforts were focused on human resources, 

process mapping, continuation of activities associated 

with the Dodd-Frank Act, and contract oversight. 

Considerable energy was devoted to ensuring that the 

FDIC’s processes and systems of control have kept 

pace with the workload, and that the foundation of 

controls throughout the FDIC remained strong. 

During 2016, among other things, program 

evaluation activities will focus on failed bank data; 

the Identity, Credential and Access Control Program; 

systems development associated with the Capital 

Investment Review Committee; the Workforce 

Development Initiative; and systems security. 

Continued emphasis and management scrutiny 

also will be applied to the accuracy and integrity of 

transactions and oversight of systems development 

efforts in general. 

MANAGEMENT REPORT 

ON FINAL ACTIONS

As required under amended Section 5 of the 

Inspector General Act of 1978, the FDIC must report 

information on final action taken by management 

on certain audit reports. The tables on the following 

pages provide information on final action taken by 

management on audit reports for the federal fiscal 

year period October 1, 2014, through September 30, 

2015.
132 FEDERAL DEPOSIT INSURANCE CORPORATION

TABLE 2: 

MANAGEMENT REPORT ON FINAL ACTION ON AUDITS 

WITH RECOMMENDATIONS TO PUT FUNDS TO BETTER USE 

FOR FISCAL YEAR 2015

Dollars in Thousands

Audit Reports Number of 

Reports

Funds Put To 

Better Use

A. Management decisions – final action not taken at beginning of period 0 $0 

B. Management decisions made during the period 1 $4,586 

C. Total reports pending final action during the period (A and B) 1 $4,586 

D Final action taken during the period:

1. Value of recommendations implemented (completed) 0 $0

2. Value of recommendations that management concluded should not or 

could not be implemented or completed

0 $0

3. Total of 1 and 2 0 $0

E. Audit reports needing final action at the end of the period 1 $4,586

TABLE 1: 

MANAGEMENT REPORT ON FINAL ACTION ON AUDITS 

WITH DISALLOWED COSTS FOR FISCAL YEAR 2015

Dollars in Thousands

(There were no audit reports in this category.)
CORPORATE MANAGEMENT CONTROL 133

TABLE 3: 

AUDIT REPORTS WITHOUT FINAL ACTIONS BUT 

WITH MANAGEMENT DECISIONS OVER ONE YEAR OLD 

FOR FISCAL YEAR 2015

Report No.

and Issue Date OIG Audit Finding Management Action Disallowed Costs

AUD-14-002

11/21/2013

EVAL-14-002

07/25/2014

The Director, Division of Administration 

(DOA), should coordinate with the 

Division of Information Technology 

(DIT) and FDIC division and office 

officials, as appropriate, to address 

potential gaps that may exist between the 

12-hour time frame required to restore 

mission essential functions following 

an emergency and the 72-hour recovery 

time objective for restoring missioncritical applications.

The FDIC, FRB, and OCC should 

consider the need to (1) increase their 

level of written enforcement action 

coordination to meet the requirements 

of Federal Register policy statement 62 

Fed. Reg. 7782, or (2) revise the policy 

statement to reflect the regulators’ 

current level of coordination.

In addition to other steps that it has 

already taken, DOA, in partnership with 

the Office of Corporate Risk Management 

and DIT, has convened a working group 

to advance a risk management framework 

that will enhance the FDIC’s business 

continuity plans. The framework will 

define a method for addressing potential 

gaps that may exist between the 12-hour 

requirement to restore mission essential 

functions and the 72-hour recovery time 

objective for restoring mission-critical 

applications. A set of options and 

recommendations will be presented to 

executive management to either accept 

identified risks or authorize resources to 

close identified gaps.

Due Date: 12/31/2016

The Legal Division and the Division 

of Risk Management Supervision will 

revise the memo and devise a new policy 

statement. 

Due Date: 4/30/2016

$0

$0
THIS PAGE INTENTIONALLY LEFT BLANK
VII. APPENDICES

135

VII.

Appendices
THIS PAGE INTENTIONALLY LEFT BLANK
APPENDICES 137

A. KEY STATISTICS

FDIC ACTIONS ON FINANCIAL INSTITUTIONS APPLICATIONS 

2013–2015

2015 2014 2013

Deposit Insurance 5 2 10

Approved1 5 2 10

Denied 0 0 0

New Branches 548 520 499

Approved 548 520 499

Denied 0 0 0

Mergers 270 251 256

Approved 270 251 256

Denied 0 0 0

Requests for Consent to Serve2 240 327 474

Approved 239 327 474

Section 19 7 7 4

Section 32 232 320 470

Denied 1 0 0

Section 19 0 0 0

Section 32 1 0 0

Notices of Change in Control 20 15 22

Letters of Intent Not to Disapprove 20 15 22

Disapproved 0 0 0

Brokered Deposit Waivers 20 46 81

Approved 20 46 81

Denied 0 0 0

Savings Association Activities 1 4 8

Approved 1 4 8

Denied 0 0 0

State Bank Activities/Investments3 10 14 10

Approved 10 14 10

Denied 0 0 0

Conversion of Mutual Institutions 4 4 7

Non-Objection 4 4 7

Objection 0 0 0

1 Includes deposit insurance application filed on behalf of (1) newly organized institutions, (2) existing uninsured financial services companies seeking 

establishment as an insured institution, and (3) interim institutions established to facilitate merger or conversion transactions, and applications to 

facilitate the establishment of thrift holding companies.

2 Under Section 19 of the Federal Deposit Insurance (FDI) Act, an insured institution must receive FDIC approval before employing a person convicted of 

dishonesty or breach of trust. Under Section 32, the FDIC must approve any change of directors or senior executive officers at a state nonmember bank 

that is not in compliance with capital requirements or is otherwise in troubled condition. 

3 Section 24 of the FDI Act, in general, prohibits a federally-insured state bank from engaging in an activity not permissible for a national bank and 

requires notices to be filed with the FDIC.
138 FEDERAL DEPOSIT INSURANCE CORPORATION

COMBINED RISK AND CONSUMER ENFORCEMENT ACTIONS 

2013–2015

2015 2014 2013

Total Number of Actions Initiated by the FDIC 268 320 414

Termination of Insurance 11 3 11

Involuntary Termination 0 0 0

Sec. 8a For Violations, Unsafe/Unsound Practices 

or Conditions

0 0 0

Voluntary Termination 11 3 11

Sec. 8a By Order Upon Request 0 0 0

Sec. 8p No Deposits 6 3 7

Sec. 8q Deposits Assumed 5 0 4

Sec. 8b Cease-and-Desist Actions 48 57 83

Notices of Charges Issued 3 1 2

Orders to Pay Restitution 9 7 11

Consent Orders 36 48 70

Personal Cease and Desist Orders 0 1 0

Sec. 8e Removal/Prohibition of Director or Officer 88 101 113

Notices of Intention to Remove/Prohibit 4 4 14

Consent Orders 84 97 99

Sec. 8g Suspension/Removal When Charged With Crime 0 2 0

Civil Money Penalties Issued 45 66 94

Sec. 7a Call Report Penalties 0 0 0

Sec. 8i Civil Money Penalties 36 62 81

Sec. 8i Civil Money Penalty Notices of Assessment 9 4 13

Sec. 10c Orders of Investigation 19 16 16

Sec. 19 Waiver Orders 51 69 88

Approved Section 19 Waiver Orders 51 68 86

Denied Section 19 Waiver Orders 0 1 2

Sec. 32 Notices Disapproving Officer/Director’s Request for Review 0 0 0

Truth-in-Lending Act Reimbursement Actions 64 69 98

Denials of Requests for Relief 0 0 0

Grants of Relief 0 0 0

Banks Making Reimbursement* 64 69 98

Suspicious Activity Reports (Open and closed institutions)* 189,505 164,777 123,134

Other Actions Not Listed 6 6 9

* These actions do not constitute the initiation of a formal enforcement action and, therefore, are not included in the total number of actions initiated.
APPENDICES 139

ESTIMATED INSURED DEPOSITS AND 

THE DEPOSIT INSURANCE FUND, 

DECEMBER 31, 1934, THROUGH SEPTEMBER 30, 20151

Dollars in Millions (except Insurance Coverage)

Deposits in Insured 

Institutions2

Insurance Fund as 

a Percentage of

Year

Insurance 

Coverage2

Total 

Domestic 

Deposits

Est. Insured

Deposits

Percentage 

of Domestic 

Deposits

Deposit 

Insurance

Fund

Total 

Domestic 

Deposits

Est. Insured

Deposits

2015 $250,000 $10,695,512 $6,420,010 60.0 $70,115.2 0.66 1.09 

2014 250,000 10,408,065 6,211,168 59.7 62,780.2 0.60 1.01 

2013 250,000 9,825,399 6,010,853 61.2 47,190.8 0.48 0.79 

2012 250,000 9,474,585 7,405,043 78.2 32,957.8 0.35 0.45 

2011 250,000 8,782,134 6,973,468 79.4 11,826.5 0.13 0.17 

2010 250,000 7,887,733 6,301,528 79.9 (7,352.2) (0.09) (0.12)

2009 250,000 7,705,353 5,407,773 70.2 (20,861.8) (0.27) (0.39)

2008 100,000 7,505,408 4,750,783 63.3 17,276.3 0.23 0.36 

2007 100,000 6,921,678 4,292,211 62.0 52,413.0 0.76 1.22 

2006 100,000 6,640,097 4,153,808 62.6 50,165.3 0.76 1.21 

2005 100,000 6,229,823 3,891,000 62.5 48,596.6 0.78 1.25 

2004 100,000 5,724,775 3,622,213 63.3 47,506.8 0.83 1.31 

2003 100,000 5,224,030 3,452,606 66.1 46,022.3 0.88 1.33 

2002 100,000 4,916,200 3,383,720 68.8 43,797.0 0.89 1.29 

2001 100,000 4,565,068 3,216,585 70.5 41,373.8 0.91 1.29 

2000 100,000 4,211,895 3,055,108 72.5 41,733.8 0.99 1.37 

1999 100,000 3,885,826 2,869,208 73.8 39,694.9 1.02 1.38 

1998 100,000 3,817,150 2,850,452 74.7 39,452.1 1.03 1.38 

1997 100,000 3,602,189 2,746,477 76.2 37,660.8 1.05 1.37 

1996 100,000 3,454,556 2,690,439 77.9 35,742.8 1.03 1.33 

1995 100,000 3,318,595 2,663,873 80.3 28,811.5 0.87 1.08 

1994 100,000 3,184,410 2,588,619 81.3 23,784.5 0.75 0.92 

1993 100,000 3,220,302 2,602,781 80.8 14,277.3 0.44 0.55 

1992 100,000 3,275,530 2,677,709 81.7 178.4 0.01 0.01 

1991 100,000 3,331,312 2,733,387 82.1 (6,934.0) (0.21) (0.25)

1990 100,000 3,415,464 2,784,838 81.5 4,062.7 0.12 0.15 

1989 100,000 3,412,503 2,755,471 80.7 13,209.5 0.39 0.48 

1988 100,000 2,337,080 1,756,771 75.2 14,061.1 0.60 0.80 

1987 100,000 2,198,648 1,657,291 75.4 18,301.8 0.83 1.10 
140 FEDERAL DEPOSIT INSURANCE CORPORATION

ESTIMATED INSURED DEPOSITS AND 

THE DEPOSIT INSURANCE FUND, 

DECEMBER 31, 1934, THROUGH SEPTEMBER 30, 20151 (continued)

Dollars in Millions (except Insurance Coverage) 

Deposits in Insured 

Institutions2

Insurance Fund as 

a Percentage of

Year

Insurance 

Coverage2

Total Domestic 

Deposits

Est. Insured

Deposits

Percentage of 

Insured Deposits

Deposit 

Insurance

Fund

Total

Domestic 

Deposits

Est. Insured

Deposits

1986 100,000 2,162,687 1,636,915 75.7 18,253.3 0.84 1.12 

1985 100,000 1,975,030 1,510,496 76.5 17,956.9 0.91 1.19 

1984 100,000 1,805,334 1,393,421 77.2 16,529.4 0.92 1.19 

1983 100,000 1,690,576 1,268,332 75.0 15,429.1 0.91 1.22 

1982 100,000 1,544,697 1,134,221 73.4 13,770.9 0.89 1.21 

1981 100,000 1,409,322 988,898 70.2 12,246.1 0.87 1.24 

1980 100,000 1,324,463 948,717 71.6 11,019.5 0.83 1.16 

1979 40,000 1,226,943 808,555 65.9 9,792.7 0.80 1.21 

1978 40,000 1,145,835 760,706 66.4 8,796.0 0.77 1.16 

1977 40,000 1,050,435 692,533 65.9 7,992.8 0.76 1.15 

1976 40,000 941,923 628,263 66.7 7,268.8 0.77 1.16 

1975 40,000 875,985 569,101 65.0 6,716.0 0.77 1.18 

1974 40,000 833,277 520,309 62.4 6,124.2 0.73 1.18 

1973 20,000 766,509 465,600 60.7 5,615.3 0.73 1.21 

1972 20,000 697,480 419,756 60.2 5,158.7 0.74 1.23 

1971 20,000 610,685 374,568 61.3 4,739.9 0.78 1.27 

1970 20,000 545,198 349,581 64.1 4,379.6 0.80 1.25 

1969 20,000 495,858 313,085 63.1 4,051.1 0.82 1.29 

1968 15,000 491,513 296,701 60.4 3,749.2 0.76 1.26 

1967 15,000 448,709 261,149 58.2 3,485.5 0.78 1.33 

1966 15,000 401,096 234,150 58.4 3,252.0 0.81 1.39 

1965 10,000 377,400 209,690 55.6 3,036.3 0.80 1.45 

1964 10,000 348,981 191,787 55.0 2,844.7 0.82 1.48 

1963 10,000 313,304 177,381 56.6 2,667.9 0.85 1.50 

1962 10,000 297,548 170,210 57.2 2,502.0 0.84 1.47 

1961 10,000 281,304 160,309 57.0 2,353.8 0.84 1.47 

1960 10,000 260,495 149,684 57.5 2,222.2 0.85 1.48 

1959 10,000 247,589 142,131 57.4 2,089.8 0.84 1.47 

1958 10,000 242,445 137,698 56.8 1,965.4 0.81 1.43 

1957 10,000 225,507 127,055 56.3 1,850.5 0.82 1.46 

1956 10,000 219,393 121,008 55.2 1,742.1 0.79 1.44 

1955 10,000 212,226 116,380 54.8 1,639.6 0.77 1.41 

1954 10,000 203,195 110,973 54.6 1,542.7 0.76 1.39 
APPENDICES 141

ESTIMATED INSURED DEPOSITS AND 

THE DEPOSIT INSURANCE FUND, 

DECEMBER 31, 1934, THROUGH SEPTEMBER 30, 20151 (continued)

Dollars in Millions (except Insurance Coverage) 

Deposits in Insured 

Institutions2

Insurance Fund as 

a Percentage of

Year

Insurance 

Coverage2

Total Domestic 

Deposits

Est. Insured

Deposits

Percentage of 

Insured Deposits

Deposit 

Insurance

Fund

Total

Domestic 

Deposits

Est. Insured

Deposits

1953 10,000 193,466 105,610 54.6 1,450.7 0.75 1.37 

1952 10,000 188,142 101,841 54.1 1,363.5 0.72 1.34 

1951 10,000 178,540 96,713 54.2 1,282.2 0.72 1.33 

1950 10,000 167,818 91,359 54.4 1,243.9 0.74 1.36 

1949 5,000 156,786 76,589 48.8 1,203.9 0.77 1.57 

1948 5,000 153,454 75,320 49.1 1,065.9 0.69 1.42 

1947 5,000 154,096 76,254 49.5 1,006.1 0.65 1.32 

1946 5,000 148,458 73,759 49.7 1,058.5 0.71 1.44 

1945 5,000 157,174 67,021 42.6 929.2 0.59 1.39 

1944 5,000 134,662 56,398 41.9 804.3 0.60 1.43 

1943 5,000 111,650 48,440 43.4 703.1 0.63 1.45 

1942 5,000 89,869 32,837 36.5 616.9 0.69 1.88 

1941 5,000 71,209 28,249 39.7 553.5 0.78 1.96 

1940 5,000 65,288 26,638 40.8 496.0 0.76 1.86 

1939 5,000 57,485 24,650 42.9 452.7 0.79 1.84 

1938 5,000 50,791 23,121 45.5 420.5 0.83 1.82 

1937 5,000 48,228 22,557 46.8 383.1 0.79 1.70 

1936 5,000 50,281 22,330 44.4 343.4 0.68 1.54 

1935 5,000 45,125 20,158 44.7 306.0 0.68 1.52 

1934 5,000 40,060 18,075 45.1 291.7 0.73 1.61 

1

 For 2015, figures are as of September 30; all other prior years are as of December 31. Prior to 1989, figures are for the Bank Insurance Fund (BIF) only 

and exclude insured branches of foreign banks. For 1989 to 2005, figures represent the sum of the BIF and Savings Association Insurance Fund (SAIF) 

amounts; for 2006 to 2015, figures are for DIF. Amounts for 1989-2015 include insured branches of foreign banks. Prior to year-end 1991, insured 

deposits were estimated using percentages determined from June Call and Thrift Financial Reports.

2

 The year-end 2008 coverage limit and estimated insured deposits do not reflect the temporary increase to $250,000 then in effect under the 

Emergency Economic Stabilization Act of 2008. The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) Act made this coverage 

limit permanent. The year-end 2009 coverage limit and estimated insured deposits reflect the $250,000 coverage limit. The Dodd-Frank Act also 

temporarily provided unlimited coverage for non-interest bearing transaction accounts for two years beginning December 31, 2010. Coverage for 

certain retirement accounts increased to $250,000 in 2006. Initial coverage limit was $2,500 from January 1 to June 30, 1934.
142 FEDERAL DEPOSIT INSURANCE CORPORATION

INCOME AND EXPENSES, DEPOSIT INSURANCE FUND, 

FROM BEGINNING OF OPERATIONS, SEPTEMBER 11, 1933, 

THROUGH DECEMBER 31, 2015 

Dollars in Millions

Income Expenses and Losses

Year Total

Assessment 

Income

Assessment 

Credits

Investment 

and Other

Effective

Assessment 

Rate1 Total

Provision 

for 

Ins. Losses

Admin.

and 

Operating 

Expenses2

Interest

& Other 

Ins. 

Expenses

Funding 

Transfer

from the 

FSLIC 

Resolution 

Fund

Net 

Income/

(Loss)

Total $219,955.3 $155,013.6 $11,392.9 $76,334.6 $147,597.3 $110,042.2 $28,094.6 $9,460.5 $139.5 $72,497.5 

2015 9,303.5 8,846.8 0.0 456.7 0.0656% (553.2) (2,251.3) 1,687.2 10.9 0 9,856.7 

2014 8,965.1 8,656.1 0.0 309.0 0.0664 (6,634.7) (8,305.5) 1,664.3 6.5 0 15,599.8 

2013 10,458.9 9,734.2 0.0 724.7 0.0776 (4,045.9) (5,659.4) 1,608.7 4.8 0 14,504.8 

2012 18,522.3 12,397.2 0.2 6,125.3 0.1012 (2,599.0) (4,222.6) 1,777.5 (153.9) 0 21,121.3 

2011 16,342.0 13,499.5 0.9 2,843.4 0.1115 (2,915.4) (4,413.6) 1,625.4 (127.2) 0 19,257.4 

2010 13,379.9 13,611.2 0.8 (230.5) 0.1772 75.0 (847.8) 1,592.6 (669.8) 0 13,304.9 

2009 24,706.4 17,865.4 148.0 6,989.0 0.2330 60,709.0 57,711.8 1,271.1 1,726.1 0 (36,002.6)

2008 7,306.3 4,410.4 1,445.9 4,341.8 0.0418 44,339.5 41,838.8 1,033.5 1,467.2 0 (37,033.2)

2007 3,196.2 3,730.9 3,088.0 2,553.3 0.0093 1,090.9 95.0 992.6 3.3 0 2,105.3 

2006 2,643.5 31.9 0.0 2,611.6 0.0005 904.3 (52.1) 950.6 5.8 0 1,739.2 

2005 2,420.5 60.9 0.0 2,359.6 0.0010 809.3 (160.2) 965.7 3.8 0 1,611.2 

2004 2,240.3 104.2 0.0 2,136.1 0.0019 607.6 (353.4) 941.3 19.7 0 1,632.7 

2003 2,173.6 94.8 0.0 2,078.8 0.0019 (67.7) (1,010.5) 935.5 7.3 0 2,241.3 

2002 2,384.7 107.8 0.0 2,276.9 0.0023 719.6 (243.0) 945.1 17.5 0 1,665.1 

2001 2,730.1 83.2 0.0 2,646.9 0.0019 3,123.4 2,199.3 887.9 36.2 0 (393.3)

2000 2,570.1 64.3 0.0 2,505.8 0.0016 945.2 28.0 883.9 33.3 0 1,624.9 

1999 2,416.7 48.4 0.0 2,368.3 0.0013 2,047.0 1,199.7 823.4 23.9 0 369.7 

1998 2,584.6 37.0 0.0 2,547.6 0.0010 817.5 (5.7) 782.6 40.6 0 1,767.1 

1997 2,165.5 38.6 0.0 2,126.9 0.0011 247.3 (505.7) 677.2 75.8 0 1,918.2 

1996 7,156.8 5,294.2 0.0 1,862.6 0.1622 353.6 (417.2) 568.3 202.5 0 6,803.2 

1995 5,229.2 3,877.0 0.0 1,352.2 0.1238 202.2 (354.2) 510.6 45.8 0 5,027.0 

1994 7,682.1 6,722.7 0.0 959.4 0.2192 (1,825.1) (2,459.4) 443.2 191.1 0 9,507.2 

1993 7,354.5 6,682.0 0.0 672.5 0.2157 (6,744.4) (7,660.4) 418.5 497.5 0 14,098.9 

1992 6,479.3 5,758.6 0.0 720.7 0.1815 (596.8) (2,274.7) 614.83 1,063.1 35.4 7,111.5 

1991 5,886.5 5,254.0 0.0 632.5 0.1613 16,925.3 15,496.2 326.1 1,103.0 42.4 (10,996.4)

1990 3,855.3 2,872.3 0.0 983.0 0.0868 13,059.3 12,133.1 275.6 650.6 56.1 (9,147.9)

1989 3,494.8 1,885.0 0.0 1,609.8 0.0816 4,352.2 3,811.3 219.9 321.0 5.6 (851.8)

1988 3,347.7 1,773.0 0.0 1,574.7 0.0825 7,588.4 6,298.3 223.9 1,066.2 0 (4,240.7)

1987 3,319.4 1,696.0 0.0 1,623.4 0.0833 3,270.9 2,996.9 204.9 69.1 0 48.5 

1986 3,260.1 1,516.9 0.0 1,743.2 0.0787 2,963.7 2,827.7 180.3 (44.3) 0 296.4 

1985 3,385.5 1,433.5 0.0 1,952.0 0.0815 1,957.9 1,569.0 179.2 209.7 0 1,427.6 

1984 3,099.5 1,321.5 0.0 1,778.0 0.0800 1,999.2 1,633.4 151.2 214.6 0 1,100.3 

1983 2,628.1 1,214.9 164.0 1,577.2 0.0714 969.9 675.1 135.7 159.1 0 1,658.2 

1982 2,524.6 1,108.9 96.2 1,511.9 0.0769 999.8 126.4 129.9 743.5 0 1,524.8 

1981 2,074.7 1,039.0 117.1 1,152.8 0.0714 848.1 320.4 127.2 400.5 0 1,226.6 

1980 1,310.4 951.9 521.1 879.6 0.0370 83.6 (38.1) 118.2 3.5 0 1,226.8 

1979 1,090.4 881.0 524.6 734.0 0.0333 93.7 (17.2) 106.8 4.1 0 996.7 

1978 952.1 810.1 443.1 585.1 0.0385 148.9 36.5 103.3 9.1 0 803.2 
APPENDICES 143

INCOME AND EXPENSES, DEPOSIT INSURANCE FUND, 

FROM BEGINNING OF OPERATIONS, SEPTEMBER 11, 1933, 

THROUGH DECEMBER 31, 2015 (continued)

Dollars in Millions

Income Expenses and Losses

Year Total

Assessment 

Income

Assessment 

Credits

Investment 

and Other

Effective

Assessment 

Rate1 Total

Provision 

for 

Ins. Losses

Admin.

and 

Operating 

Expenses2

Interest

& Other 

Ins. 

Expenses

Funding 

Transfer

from the 

FSLIC 

Resolution 

Fund

Net 

Income/

(Loss)

1977 837.8 731.3 411.9 518.4 0.0370 113.6 20.8 89.3 3.5 0 724.2 

1976 764.9 676.1 379.6 468.4 0.0370 212.3 28.0 180.44 3.9 0 552.6 

1975 689.3 641.3 362.4 410.4 0.0357 97.5 27.6 67.7 2.2 0 591.8 

1974 668.1 587.4 285.4 366.1 0.0435 159.2 97.9 59.2 2.1 0 508.9 

1973 561.0 529.4 283.4 315.0 0.0385 108.2 52.5 54.4 1.3 0 452.8 

1972 467.0 468.8 280.3 278.5 0.0333 65.7 10.1 49.6 6.05 0 401.3 

1971 415.3 417.2 241.4 239.5 0.0345 60.3 13.4 46.9 0.0 0 355.0 

1970 382.7 369.3 210.0 223.4 0.0357 46.0 3.8 42.2 0.0 0 336.7 

1969 335.8 364.2 220.2 191.8 0.0333 34.5 1.0 33.5 0.0 0 301.3 

1968 295.0 334.5 202.1 162.6 0.0333 29.1 0.1 29.0 0.0 0 265.9 

1967 263.0 303.1 182.4 142.3 0.0333 27.3 2.9 24.4 0.0 0 235.7 

1966 241.0 284.3 172.6 129.3 0.0323 19.9 0.1 19.8 0.0 0 221.1 

1965 214.6 260.5 158.3 112.4 0.0323 22.9 5.2 17.7 0.0 0 191.7 

1964 197.1 238.2 145.2 104.1 0.0323 18.4 2.9 15.5 0.0 0 178.7 

1963 181.9 220.6 136.4 97.7 0.0313 15.1 0.7 14.4 0.0 0 166.8 

1962 161.1 203.4 126.9 84.6 0.0313 13.8 0.1 13.7 0.0 0 147.3 

1961 147.3 188.9 115.5 73.9 0.0323 14.8 1.6 13.2 0.0 0 132.5 

1960 144.6 180.4 100.8 65.0 0.0370 12.5 0.1 12.4 0.0 0 132.1 

1959 136.5 178.2 99.6 57.9 0.0370 12.1 0.2 11.9 0.0 0 124.4 

1958 126.8 166.8 93.0 53.0 0.0370 11.6 0.0 11.6 0.0 0 115.2 

1957 117.3 159.3 90.2 48.2 0.0357 9.7 0.1 9.6 0.0 0 107.6 

1956 111.9 155.5 87.3 43.7 0.0370 9.4 0.3 9.1 0.0 0 102.5 

1955 105.8 151.5 85.4 39.7 0.0370 9.0 0.3 8.7 0.0 0 96.8 

1954 99.7 144.2 81.8 37.3 0.0357 7.8 0.1 7.7 0.0 0 91.9 

1953 94.2 138.7 78.5 34.0 0.0357 7.3 0.1 7.2 0.0 0 86.9 

1952 88.6 131.0 73.7 31.3 0.0370 7.8 0.8 7.0 0.0 0 80.8 

1951 83.5 124.3 70.0 29.2 0.0370 6.6 0.0 6.6 0.0 0 76.9 

1950 84.8 122.9 68.7 30.6 0.0370 7.8 1.4 6.4 0.0 0 77.0 

1949 151.1 122.7 0.0 28.4 0.0833 6.4 0.3 6.1 0.0 0 144.7 

1948 145.6 119.3 0.0 26.3 0.0833 7.0 0.7 6.36 0.0 0 138.6 

1947 157.5 114.4 0.0 43.1 0.0833 9.9 0.1 9.8 0.0 0 147.6 

1946 130.7 107.0 0.0 23.7 0.0833 10.0 0.1 9.9 0.0 0 120.7 

1945 121.0 93.7 0.0 27.3 0.0833 9.4 0.1 9.3 0.0 0 111.6 

1944 99.3 80.9 0.0 18.4 0.0833 9.3 0.1 9.2 0.0 0 90.0 

1943 86.6 70.0 0.0 16.6 0.0833 9.8 0.2 9.6 0.0 0 76.8 

1942 69.1 56.5 0.0 12.6 0.0833 10.1 0.5 9.6 0.0 0 59.0 

1941 62.0 51.4 0.0 10.6 0.0833 10.1 0.6 9.5 0.0 0 51.9 

1940 55.9 46.2 0.0 9.7 0.0833 12.9 3.5 9.4 0.0 0 43.0 

1939 51.2 40.7 0.0 10.5 0.0833 16.4 7.2 9.2 0.0 0 34.8 
144 FEDERAL DEPOSIT INSURANCE CORPORATION

1

 Figures represent only BIF-insured institutions prior to 1990, BIF- and SAIF-insured institutions from 1990 through 2005, and DIF-insured institutions 

beginning in 2006. After 1995, all thrift closings became the responsibility of the FDIC and amounts are reflected in the SAIF. The effective assessment 

rate is calculated from annual assessment income (net of assessment credits), excluding transfers to the Financing Corporation (FICO), Resolution 

Funding Corporation (REFCORP) and FSLIC Resolution Fund, divided by the four quarter average assessment base. The effective rates from 1950 through 

1984 varied from the statutory rate of 0.0833 percent due to assessment credits provided in those years. The statutory rate increased to 0.12 percent 

in 1990 and to a minimum of 0.15 percent in 1991. The effective rates in 1991 and 1992 varied because the FDIC exercised new authority to increase 

assessments above the statutory minimum rate when needed. Beginning in 1993, the effective rate was based on a risk-related premium system under 

which institutions paid assessments in the range of 0.23 percent to 0.31 percent. In May 1995, the BIF reached the mandatory recapitalization level of 

1.25 percent. As a result, BIF assessment rates were reduced to a range of 0.04 percent to 0.31 percent of assessable deposits, effective June 1995, and 

assessments totaling $1.5 billion were refunded in September 1995. Assessment rates for the BIF were lowered again to a range of 0 to 0.27 percent 

of assessable deposits, effective the start of 1996. In 1996, the SAIF collected a one-time special assessment of $4.5 billion. Subsequently, assessment 

rates for the SAIF were lowered to the same range as the BIF, effective October 1996. This range of rates remained unchanged for both funds through 

2006. As part of the implementation of the Federal Deposit Insurance Reform Act of 2005, assessment rates were increased to a range of 0.05 percent 

to 0.43 percent of assessable deposits effective at the start of 2007, but many institutions received a one-time assessment credit ($4.7 billion in total) to 

offset the new assessments. For the first quarter of 2009, assessment rates were increased to a range of 0.12 to 0.50 percent of assessable deposits. 

On June 30, 2009, a special assessment was imposed on all insured banks and thrifts, which amounted in aggregate to approximately $5.4 billion. 

For 8,106 institutions, with $9.3 trillion in assets, the special assessment was 5 basis points of each institution’s assets minus tier one capital; 89 other 

institutions, with assets of $4.0 trillion, had their special assessment capped at 10 basis points of their second quarter assessment base. From the second 

quarter of 2009 through the first quarter of 2011, initial assessment rates ranged between 0.12 and 0.45 percent of assessable deposits. Initial rates are 

subject to further adjustments. Beginning in the second quarter of 2011, the assessment base changed to average total consolidated assets less average 

tangible equity (with certain adjustments for banker’s banks and custodial banks), as required by the Dodd-Frank Act. The FDIC implemented a new 

assessment rate schedule at the same time to conform to the larger assessment base. Initial assessment rates were lowered to a range of 0.05 to 0.35 

percent of the new base. The annualized assessment rates averaged approximately 17.6 cents per $100 of assessable deposits for the first quarter of 

2011 and 11.1 cents per $100 of the new base for the last three quarters of 2011 (which is the figure shown in the table). The effective assessment rate 

for 2015 is based on year-to-date assessment income through September 30, 2015, divided by a three quarter average of the quarterly assessment base; 

the quotient is annualized.

2

 These expenses, which are presented as operating expenses in the Statement of Income and Fund Balance, pertain to the FDIC in its corporate capacity 

only and do not include costs that are charged to the failed bank receiverships that are managed by the FDIC. The receivership expenses are presented 

as part of the “Receivables from Resolutions, net” line on the Balance Sheet. The narrative and graph presented on page 85 of this report shows the 

aggregate (corporate and receivership) expenditures of the FDIC.

3

 Includes $210 million for the cumulative effect of an accounting change for certain postretirement benefits (1992).

4

 Includes a $106 million net loss on government securities (1976).

5

 This amount represents interest and other insurance expenses from 1933 to 1972.

6

 Includes the aggregate amount of $81 million of interest paid on capital stock between 1933 and 1948.

INCOME AND EXPENSES, DEPOSIT INSURANCE FUND, 

FROM BEGINNING OF OPERATIONS, SEPTEMBER 11, 1933, 

THROUGH DECEMBER 31, 2015 (continued)

Dollars in Millions

Income Expenses and Losses

Year Total

Assessment 

Income

Assessment 

Credits

Investment 

and Other

Effective

Assessment 

Rate1 Total

Provision 

for 

Ins. Losses

Admin.

and 

Operating 

Expenses2

Interest

& Other 

Ins. 

Expenses

Funding 

Transfer

from the 

FSLIC 

Resolution 

Fund

Net 

Income/

(Loss)

1938 47.7 38.3 0.0 9.4 0.0833 11.3 2.5 8.8 0.0 0 36.4 

1937 48.2 38.8 0.0 9.4 0.0833 12.2 3.7 8.5 0.0 0 36.0 

1936 43.8 35.6 0.0 8.2 0.0833 10.9 2.6 8.3 0.0 0 32.9 

1935 20.8 11.5 0.0 9.3 0.0833 11.3 2.8 8.5 0.0 0 9.5 

1933-34 7.0 0.0 0.0 7.0 N/A 10.0 0.2 9.8 0.0 0 (3.0)
APPENDICES 145

FDIC INSURED INSTITUTIONS CLOSED DURING 2015

Dollars in Thousands

Codes for Bank Class:

NM = State-chartered bank that is not a member 

of the Federal Reserve System

N = National Bank

SB = Savings Bank

SI = Stock and Mutual 

Savings Bank

SM = State-chartered bank that is a 

member of the Federal Reserve 

System

SA = Savings Association

Name and Location

Bank 

Class

Number

of 

Deposit 

Accounts

Total 

Assets1

Total 

Deposits1

Insured 

Deposit Funding 

and Other 

Disbursements

Estimated 

Loss to 

the DIF2

Date of 

Closing 

or 

Acquisition

Receiver/Assuming 

Bank and Location

Purchase and Assumption - All Deposits

First National Bank 

of Crestview

Crestview, FL

N 4,701 $73,804 $73,199 $73,338 $5,971 01/16/15 First NBC Bank

New Orleans, LA

Highland 

Community Bank

Chicago, IL

NM 2,807 $54,727 $53,453 $49,333 $5,573 01/23/15 United Fidelity Bank, 

FSB

Evansville, IN

Capitol City Bank 

and Trust Company

Atlanta, GA

NM 14,296 $272,311 $262,652 $269,980 $101,770 02/13/15 First-Citizens Bank 

and Trust Company

Raleigh, NC

Doral Bank

San Juan, PR

NM 207,722 $5,898,515 $4,097,734 $3,776,774 $669,343 02/27/15 Banco Popular de 

Puerto Rico

Hato Rey, PR

Edgebrook Bank

Chicago, IL

NM 1,614 $90,034 $90,007 $90,434 $16,782 05/08/15 Republic Bank of 

Chicago

Oak Brook, IL

Premier Bank

Denver, CO

SM 1,215 $26,760 $25,480 $25,665 $4,394 07/10/15 United Fidelity Bank, 

FSB

Evansville, IN

The Bank of Georgia

Peachtree City, GA

NM 13,204 $286,102 $264,234 $266,869 $23,155 10/02/15 Fidelity Bank

Atlanta, GA

Hometown 

National Bank

Longview, WA

N 297 $3,785 $3,705 $3,910 $1,614 10/02/15 Twin City Bank

Longview, WA

1

 Total Assets and Total Deposits data are based upon the last Call Report filed by the institution prior to failure.

2

 Estimated losses are as of December 31, 2015. Estimated losses are routinely adjusted with updated information from new appraisals and asset sales, 

which ultimately affect the asset values and projected recoveries. Represents the estimated loss to the DIF from deposit insurance obligations.
146 FEDERAL DEPOSIT INSURANCE CORPORATION

RECOVERIES AND LOSSES BY THE 

DEPOSIT INSURANCE FUND ON DISBURSEMENTS 

FOR THE PROTECTION OF DEPOSITORS, 1934 - 2015

Dollars in Thousands

Bank and Thrift Failures1

Year2

Number 

of Banks/

Thrifts

Total 

Assets3

Total 

Deposits3 Funding4 Recoveries5

Estimated 

Additional 

Recoveries

Final and 

Estimated 

Losses6

Total 2,610 $941,284,493 $708,282,924 $574,389,053 $408,846,768 $56,802,281 $108,740,004 

2015 8 6,706,038 4,870,464 4,556,304 560,000 3,167,702 828,602 

2014 18 2,913,503 2,691,485 2,677,550 320,142 1,949,750 407,658 

2013 24 6,044,051 5,132,246 4,812,554 168,935 3,328,535 1,315,084 

2012 51 11,617,348 11,009,630 10,141,109 1,633,237 5,926,222 2,581,650 

2011 92 34,922,997 31,071,862 29,829,649 2,782,790 20,169,924 6,764,024 

20107 157 92,084,988 78,290,185 80,238,225 54,190,861 9,317,868 16,729,496 

20097 140 169,709,160 137,835,121 133,847,404 92,526,431 12,777,858 28,543,115 

20087 25 371,945,480 234,321,715 205,453,181 184,246,546 2,781,758 18,424,877 

2007 3 2,614,928 2,424,187 1,920,444 1,451,701 302,160 166,583 

2006 0 0 0 0 0 0 0 

2005 0 0 0 0 0 0 0 

2004 4 170,099 156,733 139,121 134,978 226 3,917 

2003 3 947,317 901,978 883,772 812,933 8,192 62,647 

2002 11 2,872,720 2,512,834 520,543 1,711,173 (1,540,947) 350,317 

2001 4 1,821,760 1,661,214 21,131 1,138,677 (1,410,011) 292,465 

2000 7 410,160 342,584 297,313 265,175 0 32,138 

1999 8 1,592,189 1,320,573 1,307,876 711,758 5,801 590,317 

1998 3 290,238 260,675 292,839 58,248 11,541 223,050 

1997 1 27,923 27,511 25,546 20,520 0 5,026 

1996 6 232,634 230,390 201,533 140,918 0 60,615 

1995 6 802,124 776,387 609,043 524,571 0 84,472 

1994 13 1,463,874 1,397,018 1,224,769 1,045,718 0 179,051 

1993 41 3,828,939 3,509,341 3,841,658 3,209,012 0 632,646 

1992 120 45,357,237 39,921,310 14,541,477 10,866,760 704 3,674,013 

1991 124 64,556,512 52,972,034 21,500,010 15,496,730 4,998 5,998,282 

1990 168 16,923,462 15,124,454 10,812,484 8,040,995 0 2,771,489

1989 206 28,930,572 24,152,468 11,443,281 5,247,995 0 6,195,286 

1988 200 38,402,475 26,524,014 10,432,655 5,055,158 0 5,377,497 

1987 184 6,928,889 6,599,180 4,876,994 3,014,502 0 1,862,492 

1986 138 7,356,544 6,638,903 4,632,121 2,949,583 0 1,682,538 

1985 116 3,090,897 2,889,801 2,154,955 1,506,776 0 648,179 

1984 78 2,962,179 2,665,797 2,165,036 1,641,157 0 523,879 

1983 44 3,580,132 2,832,184 3,042,392 1,973,037 0 1,069,355 

1982 32 1,213,316 1,056,483 545,612 419,825 0 125,787 

1981 7 108,749 100,154 114,944 105,956 0 8,988 

1980 10 239,316 219,890 152,355 121,675 0 30,680 

1934 - 1979 558 8,615,743 5,842,119 5,133,173 4,752,295 0 380,878 
APPENDICES 147

RECOVERIES AND LOSSES BY THE 

DEPOSIT INSURANCE FUND ON DISBURSEMENTS 

FOR THE PROTECTION OF DEPOSITORS, 1934 - 2015

Dollars in Thousands

Assistance Transactions1

Year2

Number 

of Banks/

Thrifts

Total 

Assets3

Total 

Deposits3 Funding4 Recoveries5

Estimated 

Additional 

Recoveries

Final and 

Estimated 

Losses6

Total 154 $3,317,099,253 $1,442,173,417 $11,630,356 $6,199,875 $0 $5,430,481

2015 0 0 0 0 0 0 0 

2014 0 0 0 0 0 0 0 

2013 0 0 0 0 0 0 0 

2012 0 0 0 0 0 0 0 

2011 0 0 0 0 0 0 0 

2010 0 0 0 0 0 0 0 

20098 8 1,917,482,183 1,090,318,282 0 0 0 0 

20088 5 1,306,041,994 280,806,966 0 0 0 0 

2007 0 0 0 0 0 0 0 

2006 0 0 0 0 0 0 0 

2005 0 0 0 0 0 0 0 

2004 0 0 0 0 0 0 0 

2003 0 0 0 0 0 0 0 

2002 0 0 0 0 0 0 0 

2001 0 0 0 0 0 0 0 

2000 0 0 0 0 0 0 0 

1999 0 0 0 0 0 0 0 

1998 0 0 0 0 0 0 0 

1997 0 0 0 0 0 0 0 

1996 0 0 0 0 0 0 0 

1995 0 0 0 0 0 0 0 

1994 0 0 0 0 0 0 0 

1993 0 0 0 0 0 0 0 

1992 2 33,831 33,117 1,486 1,236 0 250 

1991 3 78,524 75,720 6,117 3,093 0 3,024 

1990 1 14,206 14,628 4,935 2,597 0 2,338 

1989 1 4,438 6,396 2,548 252 0 2,296 

1988 80 15,493,939 11,793,702 1,730,351 189,709 0 1,540,642 

1987 19 2,478,124 2,275,642 160,877 713 0 160,164 

1986 7 712,558 585,248 158,848 65,669 0 93,179 

1985 4 5,886,381 5,580,359 765,732 406,676 0 359,056 

1984 2 40,470,332 29,088,247 5,531,179 4,414,904 0 1,116,275 
148 FEDERAL DEPOSIT INSURANCE CORPORATION

RECOVERIES AND LOSSES BY THE 

DEPOSIT INSURANCE FUND ON DISBURSEMENTS 

FOR THE PROTECTION OF DEPOSITORS, 1934 - 2015 (continued)

Dollars in Thousands

Assistance Transactions1

Year2

Number 

of Banks/

Thrifts

Total 

Assets3

Total 

Deposits3 Funding4 Recoveries5

Estimated 

Additional 

Recoveries

Final and 

Estimated 

Losses6

1983 4 3,611,549 3,011,406 764,690 427,007 0 337,683 

1982 10 10,509,286 9,118,382 1,729,538 686,754 0 1,042,784 

1981 3 4,838,612 3,914,268 774,055 1,265 0 772,790 

1980 1 7,953,042 5,001,755 0 0 0 0 

1934 - 1979 4 1,490,254 549,299 0 0 0 0 

1 Institutions for which the FDIC is appointed receiver, including deposit payoff, insured deposit transfer, and deposit assumption cases.

2

 For 1990 through 2005, amounts represent the sum of BIF and SAIF failures (excluding those handled by the RTC); prior to 1990, figures are only 

for the BIF. After 1995, all thrift closings became the responsibility of the FDIC and amounts are reflected in the SAIF. For 2006 to 2015, figures 

are for the DIF.

3

 Assets and deposit data are based on the last Call Report or TFR filed before failure.

4

 Funding represents the amounts provided by the DIF to receiverships for subrogated claims, advances for working capital, and administrative 

expenses paid on their behalf. Beginning in 2008, the DIF resolves failures using whole-bank purchase and assumption transactions, most with an 

accompanying shared-loss agreement (SLA). The DIF satifies any resulting liabilities by offsetting receivables from resolutions when receiverships 

declare a dividend and/or sending cash directly to receiverships to fund an SLA and other expenses.

5

 Recoveries represent cash received and dividends (cash and non-cash) declared by receiverships.

6

 Final losses represent actual losses for unreimbursed subrogated claims of inactivated receiverships. Estimated losses represent the difference 

between the amount paid by the DIF to cover obligations to insured depositors and the estimated recoveries from the liquidation of receivership 

assets. 

7

 Includes amounts related to transaction account coverage under the Transaction Account Guarantee Program (TAG). The estimated losses as of 

December 31, 2015, for TAG accounts in 2010, 2009, and 2008 are $388 million, $1.186 million, and $13 million, respectively.

8

 Includes institutions where assistance was provided under a systemic risk determination.
APPENDICES 149

NUMBER, ASSETS, DEPOSITS, LOSSES, AND LOSS TO FUNDS 

OF INSURED THRIFTS TAKEN OVER OR CLOSED BECAUSE OF 

FINANCIAL DIFFICULTIES, 1989 THROUGH 19951

Dollars in Thousands

Year Total Assets Deposits

Estimated 

Receivership 

Loss2

Loss to 

Fund3

Total 748 $393,986,574 $318,328,770 $75,977,846 $81,581,460 

1995 2 423,819 414,692 28,192 27,750 

1994 2 136,815 127,508 11,472 14,599 

1993 10 6,147,962 5,708,253 267,595 65,212 

1992 59 44,196,946 34,773,224 3,286,908 3,832,145 

1991 144 78,898,904 65,173,122 9,235,967 9,734,263 

1990 213 129,662,498 98,963,962 16,062,685 19,257,578 

19894 318 134,519,630 113,168,009 47,085,027 48,649,913 

1

 Beginning in 1989 through July 1, 1995, all thrift closings were the responsibility of the Resolution Trust Corporation (RTC). Since the RTC 

was terminated on December 31, 1995, and all assets and liabilities transferred to the FSLIC Resolution Fund (FRF), all the results of the thrift 

closing activity from 1989 through 1995 are now reflected on the FRF’s books. Year is the year of failure, not the year of resolution.

2 The Estimated Receivership Loss represents the projected loss at the fund level from receiverships for unreimbursed subrogated claims of the 

FRF and unpaid advances to receiverships from the FRF.

3 The Loss to Fund represents the total resolution cost of the failed thrifts in the FRF-RTC fund. In addition to the estimated losses for 

receiverships, the loss includes corporate revenue and expense items, such as interest expense on Federal Financing Bank debt, interest expense 

on escrowed funds, and interest revenue on advances to receiverships.

4

 Total for 1989 excludes nine failures of the former FSLIC.
150 FEDERAL DEPOSIT INSURANCE CORPORATION

B. MORE ABOUT THE FDIC

FDIC BOARD OF DIRECTORS

Seated (left to right): Thomas M. Hoenig and Martin J. Gruenberg.

Standing (left to right): Thomas J. Curry and Richard Cordray.

Martin J. Gruenberg 

Martin J. Gruenberg is the 20th Chairman of the 

FDIC, receiving Senate confirmation on November 

15, 2012, for a five-year term. Mr. Gruenberg 

served as Vice Chairman and Member of the FDIC 

Board of Directors from August 22, 2005, until his 

confirmation as Chairman. He served as Acting 

Chairman from July 9, 2011, to November 15, 2012, 

and also from November 16, 2005, to June 26, 2006.

Mr. Gruenberg joined the FDIC Board after broad 

congressional experience in the financial services and 

regulatory areas. He served as Senior Counsel to 

Senator Paul S. Sarbanes (D-MD) on the staff of the 

Senate Committee on Banking, Housing, and Urban 

Affairs from 1993 to 2005. Mr. Gruenberg advised 

the Senator on issues of domestic and international 

financial regulation, monetary policy, and trade. 

He also served as Staff Director of the Banking 

Committee’s Subcommittee on International Finance 

and Monetary Policy from 1987 to 1992. Major 

legislation in which Mr. Gruenberg played an active 

role during his service on the Committee includes 

the Financial Institutions Reform, Recovery, and 

Enforcement Act of 1989 (FIRREA); the Federal 

Deposit Insurance Corporation Improvement Act of 
APPENDICES 151

1991 (FDICIA); the Gramm-Leach-Bliley Act; and 

the Sarbanes-Oxley Act of 2002.

Mr. Gruenberg served as Chairman of the Executive 

Council and President of the International Association 

of Deposit Insurers (IADI) from November 2007 to 

November 2012.

Mr. Gruenberg holds a J.D. from Case Western 

Reserve Law School and an A.B. from Princeton 

University, Woodrow Wilson School of Public and 

International Affairs.

Thomas M. Hoenig

Thomas M. Hoenig was confirmed by the Senate as 

Vice Chairman of the FDIC on November 15, 2012. 

He joined the FDIC on April 16, 2012, as a member 

of the Board of Directors of the FDIC for a six-year 

term. He is also a member of the Executive Board of 

the International Association of Deposit Insurers.

Prior to serving on the FDIC Board, Mr. Hoenig was 

the President of the Federal Reserve Bank of Kansas 

City and a member of the Federal Reserve System’s 

Federal Open Market Committee from 1991 to 2011.

Mr. Hoenig was with the Federal Reserve for 38 

years, beginning as an economist, and then as a 

senior officer in banking supervision during the U.S. 

banking crisis of the 1980s. In 1986, he led the 

Kansas City Federal Reserve Bank’s Division of Bank 

Supervision and Structure, directing the oversight of 

more than 1,000 banks and bank holding companies 

with assets ranging from less than $100 million to 

$20 billion. He became President of the Kansas City 

Federal Reserve Bank on October 1, 1991.

Mr. Hoenig is a native of Fort Madison, Iowa, and 

received a doctorate in economics from Iowa State 

University.

Thomas J. Curry

Thomas J. Curry was sworn in as the 30th 

Comptroller of the Currency on April 9, 2012. The 

Comptroller of the Currency is the administrator 

of national banks and federal savings associations, 

and chief officer of the Office of the Comptroller 

of the Currency (OCC). The OCC supervises 

approximately 1,700 national banks and federal 

savings associations and about 50 federal branches and 

agencies of foreign banks in the United States. These 

institutions comprise nearly two-thirds of the assets 

of the commercial banking system. The Comptroller 

is a Director of NeighborWorks® America and also 

a member of the Federal Financial Institutions 

Examination Council (FFIEC) where he served as 

Chairman for a two-year term from April 2013 until 

April 2015. 

Prior to becoming Comptroller of the Currency, 

Mr. Curry served as a Director of the FDIC Board 

since January 2004, and as the Chairman of the 

NeighborWorks® America Board of Directors. 

Prior to joining the FDIC’s Board of Directors, 

Mr. Curry served five Massachusetts Governors as the 

Commonwealth’s Commissioner of Banks from 1990 

to 1991 and from 1995 to 2003. He served as Acting 

Commissioner from February 1994 to June 1995. He 

previously served as First Deputy Commissioner and 

Assistant General Counsel within the Massachusetts 

Division of Banks. He entered state government in 

1982 as an attorney with the Massachusetts’ Secretary 

of State’s Office.

Mr. Curry served as the Chairman of the Conference 

of State Bank Supervisors from 2000 to 2001, and 

served two terms on the State Liaison Committee 

of the Federal Financial Institutions Examination 

Council, including a term as Committee Chairman.

He is a graduate of Manhattan College (summa cum 

laude), where he was elected to Phi Beta Kappa. He 

received his law degree from the New England School 

of Law. 

Richard Cordray 

Richard Cordray serves as the first Director of 

the Consumer Financial Protection Bureau. He 

previously led the Bureau’s Enforcement Division.

Prior to joining the Bureau, Mr. Cordray served 

on the front lines of consumer protection as Ohio’s 
152 FEDERAL DEPOSIT INSURANCE CORPORATION

Attorney General. Mr. Cordray recovered more than 

$2 billion for Ohio’s retirees, investors, and business 

owners, and took major steps to help protect its 

consumers from fraudulent foreclosures and financial 

predators. In 2010, his office responded to a record 

number of consumer complaints, but Mr. Cordray 

went further and opened that process for the first 

time to small businesses and nonprofit organizations 

to ensure protections for even more Ohioans. To 

recognize his work on behalf of consumers as Attorney 

General, the Better Business Bureau presented Mr. 

Cordray with an award for promoting an ethical 

marketplace.

Mr. Cordray also served as Ohio Treasurer and 

Franklin County Treasurer, two elected positions in 

which he led state and county banking, investment, 

debt, and financing activities. As Ohio Treasurer, he 

resurrected a defunct economic development program 

that provides low-interest loan assistance to small 

businesses to create jobs, re-launched the original 

concept as GrowNOW, and pumped hundreds of 

millions of dollars into access for credit to small 

businesses. Mr. Cordray simultaneously created a 

Bankers Advisory Council to share ideas about the 

program with community bankers across Ohio.

Earlier in his career, Mr. Cordray was an adjunct 

professor at the Ohio State University College of 

Law, served as a State Representative for the 33rd 

Ohio House District, was the first Solicitor General 

in Ohio’s history, and was a sole practitioner and 

Counsel to Kirkland & Ellis. Mr. Cordray has 

argued seven cases before the United States Supreme 

Court, by special appointment of both the Clinton 

and Bush Justice Departments. He is a graduate of 

Michigan State University, Oxford University, and 

the University of Chicago Law School. Mr. Cordray 

was Editor-in-Chief of the University of Chicago Law 

Review and later clerked for U.S. Supreme Court 

Justices Byron White and Anthony Kennedy.

Mr. Cordray lives in Grove City, Ohio, with his wife 

Peggy—a Professor at Capital University Law School 

in Columbus—and twin children Danny and Holly.

Jeremiah O. Norton

Jeremiah O. Norton resigned from the FDIC Board 

of Directors as of June 5, 2015. Mr. Norton had been 

a Board member since April 16, 2012.
APPENDICES 153

FDIC ORGANIZATION CHART/OFFICIALS

DEPUTY TO THE CHAIRMAN 

AND CHIEF OPERATING OFFICER,

CHIEF OF STAFF

DIVISION OF INFORMATION 

TECHOLOGY

Russell G. Pittman

Director

INFORMATION SECURITY

AND PRIVACY STAFF

Christopher J. Farrow

Chief Information 

Security Officer

Barbara A. Ryan

CHIEF RISK OFFICER

Stephen A. Quick

SPECIAL ADVISOR FOR

SUPERVISORY MATTERS

Jason C. Cave

DEPUTY TO THE CHAIRMAN

Kymberly K. Copa

CHIEF INFORMATION OFFICER 

AND PRIVACY OFFICER

Lawrence Gross

DEPUTY TO THE CHAIRMAN 

AND CHIEF FINANCIAL OFFICER

Steven O. App

SENIOR ADVISOR

INTERNATIONAL 

RESOLUTION POLICY

David S. Hoelscher

OFFICE OF INSPECTOR GENERAL

Fred W. Gibson

Acting Inspector General

DEPUTY TO THE CHAIRMAN

FOR COMMUNICATIONS

Barbara Hagenbaugh

INTERNAL OMBUDSMAN

Robert D. Harris

WRITER-EDITOR

Michele A. Heller

OFFICE OF 

COMMUNICATIONS

DIVISION OF RESOLUTION 

AND RECEIVERSHIPS

Bret D. Edwards

Director

LEGAL DIVISION

Charles Yi

General Counsel

DIVISION OF INSURANCE 

AND RESEARCH

Diane Ellis

Director

DIVISION OF DEPOSITOR 

AND CONSUMER PROTECTION

Mark E. Pearce

Director

OFFICE OF COMPLEX

FINANCIAL INSTITUTIONS

Arthur J. Murton

Director

DIVISION OF RISK 

MANAGEMENT SUPERVISION

Doreen R. Eberley

Director

DIVISION OF 

ADMINISTRATION

Arleas Upton Kea

Director

DIVISION OF FINANCE

Craig R. Jarvill

Director

CORPORATE UNIVERSITY

Suzannah L. Susser

Director

OFFICE OF MINORITY AND 

WOMEN INCLUSION

OFFICE OF 

LEGISLATIVE AFFAIRS

Andy Jiminez

Director

OFFICE OF 

THE OMBUDSMAN

Cottrell L. Webster

Ombudsman

Segundo Pereira

Director

BOARD OF DIRECTORS

Martin J. Gruenberg

FDIC

Chairman

Vacant

FDIC

Board Member

Thomas M. Hoenig

FDIC

Vice Chairman, Board Member

Thomas J. Curry

OCC

Board Member

Richard Cordray

CFPB

Board Member
154 FEDERAL DEPOSIT INSURANCE CORPORATION

CORPORATE STAFFING

STAFFING TRENDS 2006–2015

Note: 2008–2015 staffing totals reflect year-end full time equivalent staff. Before 2008, staffing totals reflect total employees on-board. 

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

9000

6000

3000

0

4,476 4,532 4,988 6,557 8,150 7,973 7,476

FDIC Year–End On-Board Staffing

7,254 6,631 6,385
APPENDICES 155

NUMBER OF EMPLOYEES BY DIVISION/OFFICE 2014 – 20151

Total Washington Regional/Field

Division or Office: 2015 2014 2015 2014 2015 2014

Division of Risk Management Supervision 2,683 2,704 208 205 2,475 2,500

Division of Depositor and Consumer Protection 841 853 122 128 719 725

Division of Resolutions and Receiverships 719 884 149 159 570 725

Legal Division 564 601 356 375 208 226

Division of Administration 367 372 251 245 116 127

Division of Information Technology 319 324 252 254 67 70

Corporate University 194 205 187 196 7 9

Division of Insurance and Research 205 196 163 154 42 42

Division of Finance 171 170 169 168 2 2

Information Security and Privacy Staff 36 33 36 33 0 0

Office of Inspector General 119 115 74 73 46 42

Office of Complex Financial Institutions 62 68 52 59 10 9

Executive Offices2 22 23 22 23 0 0

Executive Support Offices 3 84 85 76 76 8 9

Total 6,385 6,631 2,115 2,147 4,270 4,485

1 The FDIC reports staffing totals using a full-time equivalent methodology, which is based on an employee’s scheduled work hours. Division/Office 

staffing has been rounded to the nearest whole FTE. Totals may not foot due to rounding. 

2 Includes the Offices of the Chairman, Vice Chairman, Director (Appointive), Chief Operating Officer, Chief Financial Officer, and Chief Information 

Officer. 

3 Includes the Offices of Legislative Affairs, Communications, Ombudsman, Minority and Women Inclusion, and Corporate Risk Management.
156 FEDERAL DEPOSIT INSURANCE CORPORATION

SOURCES OF INFORMATION

FDIC Website

www.fdic.gov

A wide range of banking, consumer, and financial 

information is available on the FDIC’s website. This 

includes the FDIC’s Electronic Deposit Insurance 

Estimator (EDIE), which estimates an individual’s 

deposit insurance coverage; the Institution Directory, 

which contains financial profiles of FDIC-insured 

institutions; Community Reinvestment Act evaluations 

and ratings for institutions supervised by the FDIC; 

Call Reports, which are bank reports of condition and 

income; and Money Smart, a training program to help 

individuals outside the financial mainstream enhance 

their money management skills and create positive 

banking relationships. Readers also can access a variety 

of consumer pamphlets, FDIC press releases, speeches, 

and other updates on the agency’s activities, as well as 

corporate databases and customized reports of FDIC 

and banking industry information. 

FDIC Call Center

Phone: 877-275-3342 (877-ASK-FDIC) 

703-562-2222 

Hearing Impaired: 800-925-4618 

703-562-2289 

The FDIC Call Center in Washington, DC, is the 

primary telephone point of contact for general questions 

from the banking community, the public, and FDIC 

employees. The Call Center directly, or with other 

FDIC subject-matter experts, responds to questions 

about deposit insurance and other consumer issues and 

concerns, as well as questions about FDIC programs and 

activities. The Call Center also refers callers to other 

federal and state agencies as needed. Hours of operation 

are 8:00 a.m. to 8:00 p.m., Eastern Time, Monday – 

Friday, and 9:00 a.m. to 5:00 p.m., Saturday – Sunday. 

Recorded information about deposit insurance and 

other topics is available 24 hours a day at the same 

telephone number.

As a customer service, the FDIC Call Center has many 

bilingual Spanish agents on staff and has access to a 

translation service, which is able to assist with over 40 

different languages.

Public Information Center 

3501 Fairfax Drive

Room E-1021

Arlington, VA 22226

Phone: 877-275-3342 (877-ASK-FDIC),

703-562-2200

Fax: 703-562-2296

FDIC Online Catalog: https://catalog.fdic.gov

E-mail: publicinfo@fdic.gov

Publications such as FDIC Quarterly and Consumer 

News and a variety of deposit insurance and consumer 

pamphlets are available at www.fdic.gov or may 

be ordered in hard copy through the FDIC online 

catalog. Other information, press releases, speeches 

and congressional testimony, directives to financial 

institutions, policy manuals, and FDIC documents are 

available on request through the Public Information 

Center. Hours of operation are 9:00 a.m. to 4:00 p.m., 

Eastern Time, 

Monday – Friday.

Office of the Ombudsman

3501 Fairfax Drive

Room E-2022

Arlington, VA 22226

Phone: 877-275-3342 (877-ASK-FDIC) 

Fax: 703-562-6057

E-mail: ombudsman@fdic.gov

The Office of the Ombudsman (OO) is an independent, 

neutral, and confidential resource and liaison for 

the banking industry and the general public. The 

OO responds to inquiries about the FDIC in a fair, 

impartial, and timely manner. It researches questions 

and fields complaints from bankers and bank customers. 

OO representatives are present at all bank closings 

to provide accurate information to bank customers, 

the media, bank employees, and the general public. 

The OO also recommends ways to improve FDIC 

operations, regulations, and customer service.
APPENDICES 157

REGIONAL AND AREA OFFICES

Atlanta Regional Office

Michael J. Dean, Regional Director

10 Tenth Street, NE

Suite 800

Atlanta, Georgia 30309

(678) 916-2200

Alabama

Florida

Georgia

North Carolina

South Carolina

Virginia

West Virginia

Dallas Regional Office

Kristie K. Elmquist, Regional Director

1601 Bryan Street

Dallas, Texas 75201

(214) 754-0098

Colorado

New Mexico

Oklahoma

Texas

Kansas City Regional Office

James D. LaPierre, Regional Director

1100 Walnut Street

Suite 2100

Kansas City, Missouri 64106

(816) 234-8000

Iowa

Kansas

Minnesota

Missouri

Nebraska

North Dakota

South Dakota

Chicago Regional Office

M. Anthony Lowe, Regional Director

300 South Riverside Plaza

Suite 1700

Chicago, Illinois 60606

(312) 382-6000

Illinois

Indiana

Kentucky

Michigan

Ohio

Wisconsin

Memphis Area Office

Kristie K. Elmquist, Director

6060 Primacy Parkway

Suite 300

Memphis, Tennessee 38119

(901) 685-1603

Arkansas

Louisiana

Mississippi

Tennessee

New York Regional Office

John F. Vogel, Regional Director

350 Fifth Avenue

Suite 1200

New York, New York 10118

(917) 320-2500

Delaware

District of Columbia

Maryland

New Jersey

New York

Pennsylvania

Puerto Rico

Virgin Islands
158 FEDERAL DEPOSIT INSURANCE CORPORATION

Boston Area Office

John F. Vogel, Director

15 Braintree Hill Office Park

Suite 100

Braintree, Massachusetts 02184

(781) 794-5500

Connecticut

Maine

Massachusetts

New Hampshire

Rhode Island

Vermont

San Francisco Regional Office

Stanley R. Ivie, Regional Director

25 Jessie Street at Ecker Square

Suite 2300

San Francisco, California 94105

(415) 546-0160

Alaska

American Samoa

Arizona

California

Federated States of Micronesia

Guam

Hawaii

Idaho

Montana

Nevada

Oregon

Utah

Washington

Wyoming
APPENDICES 159

C. OFFICE OF INSPECTOR 

GENERAL’S ASSESSMENT 

OF THE MANAGEMENT AND 

PERFORMANCE CHALLENGES 

FACING THE FDIC 

Under the Reports Consolidation Act of 2000, 

the Office of Inspector General (OIG) identifies 

the management and performance challenges 

facing the FDIC and provides its assessment to the 

Corporation for inclusion in the FDIC’s annual 

performance and accountability report. In doing 

so, we keep in mind the FDIC’s overall program 

and operational responsibilities; financial industry, 

economic, and technological conditions and trends; 

areas of congressional interest and concern; relevant 

laws and regulations; the Chairman’s priorities and 

corresponding corporate goals; and ongoing activities 

to address the issues involved. The OIG believes that 

the FDIC faces challenges in the critical areas listed 

below, a number of which carry over from last year. 

These challenges will continue to occupy much of the 

Corporation’s attention and require its sustained focus 

for the foreseeable future. 

Carrying Out Dodd-Frank Act 

Responsibilities

The Dodd-Frank Wall Street Reform and Consumer 

Protection Act (the Dodd-Frank Act) created a 

comprehensive new regulatory and resolution 

framework designed to avoid the severe consequences 

of financial instability. Title I of the Dodd-Frank 

Act provides tools for regulators to impose enhanced 

supervision and prudential standards on systemically 

important financial institutions (SIFI). Title II 

provides the FDIC with a new orderly liquidation 

authority for SIFIs, subject to a systemic risk 

determination by statutorily designated regulators. 

The FDIC has made progress toward implementing 

its systemic resolution authorities under the DoddFrank Act, in large part due to the efforts of an 

active cross-divisional working group composed of 

senior FDIC officials, but challenges remain. These 

challenges involve the FDIC fulfilling its insurance, 

supervisory, receivership management, and resolution 

responsibilities as it meets the requirements of the 

Dodd-Frank Act. These responsibilities are crosscutting and are carried out by staff throughout the 

Corporation’s headquarters and regional divisions 

and offices, including in the Office of Complex 

Financial Institutions (OCFI), an office established 

in response to the Dodd-Frank Act. That office has 

taken steps to realign organizational responsibilities 

for Title I and Title II tasks in the interest of ensuring 

the most efficient and complementary efforts of staff 

involved in both. Staff members from the FDIC’s 

Division of Risk Management Supervision, Division 

of Resolutions and Receiverships (DRR), and Legal 

Division join OCFI in collaborative efforts and play 

key roles in implementing Titles I and II.

Those involved in Dodd-Frank Act activities will 

continue to evaluate the resolution plans submitted 

by the largest bank holding companies and other 

SIFIs under Title I, develop strategies for resolving 

SIFIs under Title II, work to promote cross-border 

cooperation for the orderly resolution of a global SIFI, 

and coordinate with the other regulators in developing 

policy to implement the provisions of the Act.

In a related vein, the FDIC will carry out risk 

assessments to identify supervisory, resolution, 

and insurance pricing-related risks in all insured 

depository institutions (IDIs) with more than $10 

billion in assets, including those for which the FDIC 

is not the PFR, in addition to systemically important 

bank holding companies and nonbank financial 

companies subject to Title I of the Dodd-Frank Act.

Maintaining Strong Information Technology 

Security and Governance Practices

Essential to achieving the FDIC’s mission of 

maintaining stability and public confidence in the 

nation’s financial system is safeguarding sensitive 

information, including personally identifiable 

information that the FDIC collects and manages 

in its role as federal deposit insurer and regulator of 
160 FEDERAL DEPOSIT INSURANCE CORPORATION

state nonmember financial institutions. Further, as 

an employer, an acquirer of services, and a receiver 

for failed institutions, the FDIC obtains considerable 

amounts of sensitive information from its employees, 

contractors, and failed institutions. Increasingly 

sophisticated security risks and global connectivity 

have resulted in both internal and external risks 

to that sensitive information. Internal risks at the 

FDIC include errors and fraudulent or malevolent 

acts by employees or contractors working within the 

organization who may, for example, exfiltrate sensitive 

data from the workplace—so called “insider threats.” 

External threats include a growing number of cyberbased attacks that can come from a variety of sources, 

such as hackers, criminals, foreign nations, terrorists, 

and other adversarial groups. Such threats underscore 

the importance of a strong, enterprise-wide program 

that implements strategies to enhance cybersecurity 

within both the FDIC and the banking industry. 

Going forward, a challenging priority for the FDIC 

will be to maintain effective communication and 

collaboration among all parties involved in ensuring a 

robust, secure information technology (IT) operating 

environment that meets the day-to-day and longerterm needs of the FDIC employees who depend on it. 

In that regard, as we pointed out in recent work under 

the Federal Information Security Modernization Act 

of 2014, the Corporation will need to ensure that 

the skills, training, oversight, and resource allocations 

pertaining to division and office information security 

managers enable them to successfully carry out their 

responsibilities. The FDIC has also relied heavily 

on its infrastructure services contract to support IT 

operations and implement security controls. If not 

properly managed, problems that affect the FDIC’s 

IT operations could ensue. In addition, given the 

substantial financial investment in FDIC systems 

and related human resources, the Corporation needs 

to consider the cost-effectiveness and measurable 

business value outcomes in its decisions to fund major 

IT projects to ensure effective stewardship of millions 

of dollars in IT investments.

The Corporation will also need to ensure that its 

continuity of operations and disaster recovery plans 

are effective in addressing the negative impacts of 

natural disasters or other catastrophic events that 

disrupt its business processes and activities and 

other government activities. In this regard, in 

2014, the FDIC placed into operation a Sensitive 

Compartmented Information Facility (SCIF) to meet 

continuity of operations requirements for a Level 2 

agency. The SCIF was constructed to standards of 

Intelligence Community Directive 705, Sensitive 

Compartmented Information Facilities. The FDIC 

reported that the SCIF received physical security 

accreditation in August 2014 and that equipment 

was purchased to enable communications testing and 

assessments planned in the future. Such a facility 

can help ensure the security of the FDIC’s systems 

and infrastructure and facilitate communications 

with other federal agencies if a widespread emergency 

occurs.

Maintaining Effective Supervision and 

Preserving Community Banking

The FDIC’s supervision program promotes the safety 

and soundness of FDIC-supervised IDIs. The FDIC 

is the PFR for 4,037 FDIC-insured, state-chartered 

institutions that are not members of the Board of 

Governors of the Federal Reserve System. As such, 

the FDIC is the lead federal regulator for the majority 

of community banks. We have pointed out in our 

past work that a key lesson from the crisis is the need 

for earlier regulatory response when risks are building. 

Even now, for example, as they operate in a postcrisis environment, banks may be tempted to take 

additional risks, engage in imprudent concentrations, 

or loosen underwriting standards. Some banks are 

also introducing new products or lines of business 

or seeking new sources for non-interest income, all 

of which can lead to interest rate risk, credit risk, 

operational risk, and reputational risk. Such risks 

need to be managed and addressed early-on during 

the “good times” before a period of downturn. FDIC 

examiners need to identify problems, bring them to 

bank management’s attention, follow up on problems, 

bring enforcement actions as needed, and be alert 

to such risks as Bank Secrecy Act and anti-money-
APPENDICES 161

laundering issues. In doing so, the Corporation 

needs to execute its supervisory authority in a fair, 

consistent manner. With respect to important 

international concerns, the FDIC also needs to 

support development of sound global regulatory 

policy through participation on the Basel Committee 

on Bank Supervision and other related sub-groups.

In light of technological changes, increased use of 

technology service providers (TSP), new delivery 

channels, and cyber threats, the FDIC’s IT 

examination program needs to be proactive and 

bankers and Boards of Directors need to ensure 

a strong control environment and sound risk 

management and governance practices in their 

institutions. Importantly, with respect to TSPs, 

one TSP can service hundreds or even thousands of 

financial institutions, so that the impact of security 

incidents in one TSP can have devastating ripple 

effects on those institutions. Controls need to be 

designed not only to protect sensitive customer 

information at banks and TSPs, but also to guard 

against intrusions that can compromise the integrity 

and availability of operations, information and 

transaction processing systems, and data. Given 

the complexities of the range of cyber threats, the 

FDIC needs to ensure its examination workforce has 

the needed expertise to effectively carry out its IT 

examination responsibilities.

The FDIC has tried over the past year to enhance 

the Corporation’s IT supervision program for 

FDIC-supervised institutions and TSPs to focus 

on information security, cybersecurity, and 

business continuity. In the coming months, the 

Corporation needs to continue efforts, along with 

the other regulators, to address these risks and use all 

available supervisory and legal authorities to ensure 

the continued safety and soundness of financial 

institutions and affiliated third-party entities. It also 

needs to ensure effective information-sharing about 

security incidents with regulatory parties and other 

federal groups established to combat cyber threats, in 

an increasingly interconnected world.

The FDIC Chairman continues to emphasize that one 

of the FDIC’s most important priorities is the future 

of community banks and the critical role they play in 

the financial system and the U.S. economy as a whole. 

Local communities and small businesses rely heavily 

on community banks for credit and other essential 

financial services. These banks foster economic 

growth and help to ensure that the financial resources 

of the local community are put to work on its behalf. 

Consolidations and other far-reaching changes in 

the U.S. financial sector in recent decades have 

made community banks a smaller part of the U.S. 

financial system. The FDIC has sought to identify 

and implement changes to improve the efficiency and 

effectiveness of the community bank risk management 

and compliance examination processes, while still 

maintaining supervisory standards. To ensure the 

continued strength of the community banks, the 

Corporation will also need to sustain initiatives such 

as ongoing research, technical assistance to the banks 

by way of training videos on key risk management 

and consumer compliance matters, and continuous 

dialogue with community banking groups.

Maintaining a strong examination program, 

conducting vigilant supervisory activities for both 

small and large banks, applying lessons learned, 

being attuned to harmful cyber threats in financial 

institutions and technology service providers, and 

preserving community banking will be critical to 

ensuring stability and continued confidence in the 

financial system going forward. 

Carrying Out Current and Future Resolution 

and Receivership Responsibilities

One of the FDIC’s most important roles is acting 

as the receiver or liquidating agent for failed FDICinsured institutions. The FDIC’s responsibilities 

include planning and efficiently handling the 

resolutions of failing FDIC-insured institutions 

and providing prompt, responsive, and efficient 

administration of failing and failed financial 

institutions in order to maintain confidence and 

stability in our financial system. 

As part of the resolution process, the FDIC values 

a failing federally insured depository institution, 
162 FEDERAL DEPOSIT INSURANCE CORPORATION

markets it, solicits and accepts bids for the sale of 

the institution, considers the least costly resolution 

method, determines which bid to accept, and works 

with the acquiring institution through the closing 

process. The receivership process involves performing 

the closing function at the failed bank; liquidating 

any remaining assets; and distributing any proceeds to 

the FDIC, the bank customers, general creditors, and 

those with approved claims.

The FDIC places great emphasis on promptly 

marketing and selling the assets of failed institutions 

and terminating the receivership quickly. Although 

the number of institution failures has fallen 

dramatically since the crisis, these activities still pose 

challenges to the Corporation. As of December 31, 

2015, DRR was managing 446 active receiverships 

with assets in liquidation totaling about $4.8 billion. 

In addition, through purchase and assumption 

agreements with acquiring institutions, the 

Corporation has entered into shared-loss agreements 

(SLA). Since loss sharing began during the most 

recent crisis in November 2008, the Corporation 

has resolved 304 failures with accompanying SLAs. 

Under these agreements, the FDIC agrees to absorb 

a portion of the loss—generally 80 to 95 percent—

which may be experienced by the acquiring institution 

with regard to those assets, for a period of up to ten 

years. The initial asset balance of the covered assets in 

these SLAs was $216.5 billion. As of December 31, 

2015, 215 receiverships still had active SLAs, with a 

covered asset balance at that time of $31.5 billion. 

As another resolution strategy, the FDIC entered 

into 35 structured sales transactions involving 

43,315 assets with a total unpaid principal balance 

of $26.2 billion. Under these arrangements, the 

FDIC receiverships retain a participation interest 

in future net positive cash flows derived from thirdparty management of these assets. As of December 

31, 2015, the unpaid principal balance in 34 active 

arrangements was $3.3 billion. The FDIC will 

continue to evaluate termination offers from limited 

liability company (LLC) managing members in 

deciding whether to pursue dissolution of the LLCs if 

in the best economic interest of the receiverships. 

As time passes and recovery from the crisis continues, 

these risk sharing agreements will continue to 

wind down and certain active receiverships will be 

terminated. Given the substantial dollar value and 

risks associated with the risk-sharing activities and 

other receivership operations, the FDIC needs to 

ensure continuous monitoring and effective oversight 

to protect the FDIC’s financial interests. 

Given improving conditions in the economy and 

financial system, the Corporation has reshaped its 

workforce and adjusted its budget and resources 

accordingly. Notably, in the case of the FDIC’s 

resolutions and receiverships workforce, authorized 

staffing fell from a peak of 2,460 in 2010 to 

authorized staffing of 756 for 2015. DRR will 

continue to substantially reduce its nonpermanent 

staff each year, based on declining workload. 

These staff reductions bring with them a loss of 

specialized experience and expertise. As discussed in 

connection with the Dodd-Frank Act responsibilities, 

the Corporation must continue to review the 

resolution plans of large bank holding companies and 

designated nonbank holding companies to ensure 

their resolvability under the Bankruptcy Code, if 

necessary, and in cases where their failure would 

threaten financial stability, administer their orderly 

liquidation. Carrying out such activities could pose 

significant challenges to those remaining staff in DRR 

who could be called upon to lead critical resolution 

activities.

Ensuring the Continued Strength of 

the Deposit Insurance Fund 

Insuring deposits remains at the heart of the FDIC’s 

commitment to maintain stability and public 

confidence in the nation’s financial system. To 

maintain sufficient Deposit Insurance Fund (DIF) 

balances, the FDIC collects risk-based insurance 

premiums from insured institutions and invests 

deposit insurance funds. In response to the DoddFrank Act and in the interest of protecting and 

insuring depositors, the Corporation has designed 

a long-term DIF management plan. This plan 
APPENDICES 163

complements the Restoration Plan, which is designed 

to ensure that the DIF reserve ratio will reach 1.35 

percent by September 30, 2020. As of September 30, 

2015, the reserve ratio had reached 1.09 percent. 

In the aftermath of the financial crisis, FDIC-insured 

institutions continue to make gradual but steady 

progress. Continuing to replenish the DIF in a 

post-crisis environment is a critical activity for the 

FDIC. The DIF balance had dropped below negative 

$20 billion during the worst time of the crisis. As 

of December 31, 2015, the DIF balance was $72.6 

billion, an increase of $9.8 billion over the year-end 

2014 balance of $62.8 billion.

While the fund is considerably stronger than it 

has been, the FDIC must continue to monitor the 

emerging risks that can threaten fund solvency in 

the interest of continuing to provide the insurance 

coverage that depositors have come to rely upon. 

In that regard, the FDIC will need to continue to 

regularly disseminate data and analysis on issues 

and risks affecting the financial services industry 

to bankers, supervisors, the public, and other 

stakeholders.

Given the volatility of the global markets and financial 

systems, new risks can emerge without warning and 

threaten the safety and soundness of U.S. financial 

institutions and the viability of the DIF. The FDIC 

must be prepared for such a possibility. As part of 

its efforts, the FDIC needs to continue collaborating 

with others involved in helping to ensure financial 

stability and protect the DIF. One important means 

of doing so is through participation on the Financial 

Stability Oversight Council, created under the DoddFrank Act. This Council was established to provide 

comprehensive monitoring of stability in the U.S. 

financial system by identifying and responding to 

emerging risks to U.S. financial stability and by 

promoting market discipline. 

The FDIC will also be challenged to contribute to 

global financial stability by continuing its engagement 

with strategically important foreign jurisdictions and 

playing a leadership role in international organizations 

that support robust, effective deposit insurance 

systems, resolution programs, and bank supervision 

practices around the globe. 

Promoting Consumer Protections 

and Economic Inclusion

The FDIC carries out its consumer protection role 

by providing consumers with access to information 

about their rights and disclosures that are required 

by federal laws and regulations. Importantly, it also 

examines the banks where the FDIC is the PFR to 

determine the institutions’ compliance with laws 

and regulations governing consumer protection, fair 

lending, and community investment. These activities 

require regular collaboration with other regulatory 

agencies. In particular, the FDIC coordinates with 

the Consumer Financial Protection Bureau, created 

under the Dodd-Frank Act, on consumer issues of 

mutual interest and to meet statutory requirements 

for consultation relating to rulemakings in mortgage 

lending and other types of consumer financial 

services and products. The FDIC will need to 

continue to assess the impact of such rulemakings on 

supervised institutions, communicate key changes to 

stakeholders, and train examination staff accordingly. 

The FDIC continues to work with the Congress and 

others to ensure that the banking system remains 

sound and that the broader financial system is 

positioned to meet the credit needs of consumers and 

the economy, especially the needs of creditworthy 

households that may experience distress. One of 

the challenges articulated by the FDIC Chairman 

is to continue to increase access to financial services 

for the unbanked and underbanked in the United 

States. The Corporation will continue to develop 

and implement targeted strategies to expand access 

to mainstream financial institutions by populations 

that are disproportionately likely to be unbanked or 

underbanked. Input from the FDIC’s 2015 National 

Survey of Unbanked and Underbanked Households

will inform those strategies. In addition, the FDIC’s 

Advisory Committee on Economic Inclusion, 

composed of bankers, community and consumer 
164 FEDERAL DEPOSIT INSURANCE CORPORATION

organizations, and academics, will continue to explore 

ways of bringing the unbanked into the financial 

mainstream. The FDIC’s Alliance for Economic 

Inclusion initiative seeks to collaborate with financial 

institutions; community organizations; local, state, 

and federal agencies; and other partners to form 

broad-based coalitions to bring unbanked and 

underbanked consumers and small businesses into the 

financial mainstream. 

The FDIC will need to sustain ongoing efforts to 

carry out required compliance and community 

reinvestment examinations, coordinate with the 

other financial regulators and CFPB on regulatory 

matters involving financial products and services, and 

pursue and measure the success of economic inclusion 

initiatives to the benefit of the American public. 

Implementing Workforce Changes 

and Budget Reductions 

During the 2015 planning and budget process, the 

Corporation reassessed its current and projected 

workload along with trends within the banking 

industry and the broader economy.  Based on that 

review, the FDIC expects a continuation of steady 

improvements in the global economy, a small number 

of insured institution failures, gradual reductions in 

post-failure receivership management workload, and 

significant further reductions in the number of 3-, 

4-, and 5-rated institutions.  While the FDIC will 

continue to need some temporary and term employees 

over the next several years to complete the residual 

workload from the financial crisis, industry trends 

confirm that there will be a steadily decreasing 

need for nonpermanent employees over the next 

several years.

Given those circumstances, the FDIC Board of 

Directors approved a $2.32 billion Corporate 

Operating Budget for 2015, 3.0 percent lower than 

the 2014 budget. In conjunction with its approval 

of the 2015 budget, the Board also approved an 

authorized 2015 staffing level of 6,886 positions, 

down from 7,200 previously authorized, a net 

reduction of 314 positions. This was the fifth 

consecutive reduction in the FDIC’s annual 

operating budget.

As conditions improve throughout the industry and 

the economy, the FDIC will continue its efforts to 

achieve the appropriate level of resources; at the 

same time, however, it needs to remain mindful 

of ever-present risks and other uncertainties in the 

economy that may prompt the need for additional 

resources and new skill sets and expertise that may 

be challenging to obtain. The need for these new 

skill sets comes at a time when the Corporation is 

focusing on succession management, in light of a 

substantial number of FDIC staff who are retiring. In 

that regard, the FDIC is continuing to work toward 

integrated workforce development processes as it 

seeks to bring on the best people to meet its changing 

needs and priorities, and do so in a timely manner. 

Most recently, the Corporation has emphasized its 

Workforce Development Initiative as a means of 

fulfilling the FDIC’s future leadership and workforce 

capability needs. 

The FDIC has long promoted diversity and 

inclusion initiatives in the workplace. Section 342 

of the Dodd-Frank Act reiterates the importance 

of standards for assessing diversity policies and 

practices and developing procedures to ensure the fair 

inclusion and utilization of women and minorities 

in the FDIC’s contractor workforce. The DoddFrank Act also points to the Office of Minority and 

Women Inclusion as being instrumental in diversity 

and inclusion initiatives within the FDIC working 

environment. This office needs to ensure that it has 

the proper staff, expertise, and organizational structure 

to successfully carry out its advisory responsibilities 

to ensure diversity and inclusion throughout the 

Corporation.

The FDIC needs to sustain its emphasis on 

fostering employee engagement and morale on 

the part of all staff in headquarters, regions, and 

field locations. Its diversity and inclusion goals 

and initiatives, Workplace Excellence Program, 

and Workforce Development Initiative are positive 
APPENDICES 165

steps in that direction and should continue to help 

create a workplace that promotes diversity and equal 

opportunity. 

Ensuring Effective Enterprise 

Risk Management Practices

Enterprise risk management is a critical aspect of 

governance at the FDIC. Notwithstanding a stronger 

economy and financial services industry, the FDIC’s 

enterprise risk management framework and related 

activities need to be attuned to emerging risks, both 

internal and external to the FDIC that can threaten 

key business processes and corporate success. As 

evidenced in the challenges discussed above, certain 

difficult issues may fall within the purview of a single 

division or office, while others are cross-cutting within 

the FDIC, and others involve coordination with the 

other financial regulators and other external parties. 

The Corporation needs to maintain effective controls, 

mechanisms, and risk models that can address a wide 

range of concerns—from specific, everyday risks such 

as those posed by personnel security practices and 

records management activities, for example, to the far 

broader concerns of the ramifications of an unwanted 

and harmful cyber attack or the failure of a large bank 

or systemically important financial institution.

The Corporation’s stakeholders—including the 

Congress, American people, media, and others— 

expect effective governance, sound risk management 

practices, and vigilant regulatory oversight of the 

financial services industry. The Corporation needs to 

maintain the trust and confidence that it has instilled 

over the years. The FDIC Board of Directors, senior 

management, and individuals at every working level 

throughout the FDIC need to understand current 

and emerging risks to the FDIC mission and be 

prepared to take necessary steps to mitigate those risks 

as changes occur and challenging scenarios that can 

undermine the FDIC’s short- and long-term success 

present themselves.
166 FEDERAL DEPOSIT INSURANCE CORPORATION

AEI Alliance for Economic Inclusion

AMC Appraisal management company

AML Anti-Money Laundering

ANPR Advanced Notice of Proposed Rulemaking

ASBA Association of Supervisors of Banks of the 

Americas

BCBS Basel Committee on Banking Supervision

BCP Business Continuity Planning

BSA Bank Secrecy Act

Call Report Consolidated Reports of Condition and 

Income

CAMELS 

rating scale Capital adequacy; Asset quality; Management 

quality; Earnings; Liquidity; Sensitivity to 

market risks

CAS Claims Administration System

CCIWG Cybersecurity and Critical Infrastructure 

Working Group

CCP Central counterparties

CDFI Community Development Financial 

Institution

CEO Chief Executive Officer

CEP Corporate Employee Program

CFI Complex Financial Institution

CFO Act Chief Financial Officers’ Act

CFPB Consumer Financial Protection Bureau

CFR Center for Financial Research

CFTC Commodity Futures Trading Commission

CMP Civil Money Penalty

ComE-IN Advisory Committee on Economic Inclusion

CRA Community Reinvestment Act

CRE Commercial real estate

CVSS Common Vulnerability Scoring System

DFA Dodd-Frank Act

DGP Debt guarantee program

DIF Deposit Insurance Fund

DRR Designated Reserve Ratio

EC European Commission

EDIE Electronic Deposit Insurance Estimator

EGRPRA Economic Growth and Regulatory Paperwork 

Reduction Act of 1996

ETS Examination Tools Suite

FAQ Frequently Asked Questions

FDI ACT Federal Deposit Insurance Act

FDIC Federal Deposit Insurance Corporation

FFIEC Federal Financial Institutions Examination 

Council

FFMIA Federal Financial Management Improvement 

Act

FHFA Federal Housing Finance Agency

FIL Financial Institution Letter

FIS Financial Institution Specialist

FISMA Federal Information Security Management Act

FMFIA Federal Managers’ Financial Integrity Act

FMSP Financial Management Scholars Program

FRB Board of Governors of the Federal Reserve 

System

FRF FSLIC Resolution Fund

FSAP Financial Sector Assessment Program

FSB Financial Stability Board

FS-ISAC Financial Services Information Sharing and 

Analysis Center

FSLIC Federal Savings and Loan Insurance 

Corporation

FSOC Financial Stability Oversight Council

FSVC Financial Services Volunteer Corps

GAAP Generally accepted accounting principles

GAO U.S. Government Accountability Office

GPRA Government Performance and Results Act

G-SIFIs Global Systemically Important Financial 

Institutions

IADI International Association of Deposit Insurers

IDI Insured depository institution

IMF International Monetary Fund

IMFB IndyMac Federal Bank

IT Information technology

LCR Liquidity coverage ratio

LIDI Large Insured Depository Institution

LLC Limited Liability Company

LMI Low- or moderate-income

LURA Land use restriction agreements

MDI Minority depository institutions

MFA Multi-Factor Authentication

D. ACRONYMS
APPENDICES 167

MOL Maximum Obligation Limitation

MOU Memoranda of Understanding

MRBA Matters Requiring Board Attention

MWOB Minority- and women-owned business

MWOLF Minority- and women-owned law firms 

NCUA National Credit Union Administration

NPR Notice of proposed rulemaking

NSFR Net Stable Funding Ratio

OCC Office of the Comptroller of the Currency

OFAC Office of Foreign Assets Control

OLA Orderly Liquidation Authority

OLF Orderly Liquidation Fund

OMB U.S. Office of Management and Budget

OPM U.S. Office of Personnel Management

OTC Over-the-counter

OTS Office of Thrift Supervision

P&A Purchase and assumption

PFR Primary federal regulator

QBP Quarterly Banking Profile

ReSG FSB’s Resolution Steering Group

RESPA Real Estate Settlement Procedures Act

RTC Resolution Trust Corporation

SBA Small Business Administration

SCIF Sensitive Compartment Information Facility

SEC Securities and Exchange Commission

SIFI Systemically Important Financial Institution

SRM Single Resolution Mechanism

SLA Shared-loss agreement

SMS Systemic Monitoring System

SNC Program Shared National Credit Program

SNM State Nonmember

SRAC Systemic Resolution Advisory Committee

SRB Single Resolution Board

SRM Single Resolution Mechanism

SSGN Structured sale of guaranteed note

TLGP Temporary Liquidity Guarantee Program

TSP Federal Thrift Savings Plan

TSP (IT-related) Technology service providers

VIE Variable interest entity

WE Workplace Excellence
NOTES
2015

Federal Deposit 

Insurance Corporation

This Annual Report was produced by talented and dedicated staff. 

To these individuals, we would like to offer our sincere thanks and 

appreciation. Special recognition is given to the following for their 

contributions:

♦ Jannie F. Eaddy 

♦ Brian D. Aaron

♦ Barbara A. Glasby

♦ Financial Reporting Section Staff

♦ Division and Office Points-of-Contact
H H H

H H H

550 17th Street, N.W.

Washington, DC 20429-9990

www.fdic.gov

FDIC-003-2016