ANNUAL

REPORT

2023
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ANNUAL

REPORT

2023
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 3 

CONTENTS

Mission, Vision, and Values .......................................................................................4

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

Message from the Chief Financial Officer.................................................................. 21

FDIC Senior Leaders ............................................................................................... 23

FDIC 90th Anniversary............................................................................................ 24

I. Management’s Discussion and Analysis ........................................................... 25

Overview...............................................................................................................................27

Action Plan for a Safe, Fair and Inclusive Work Environment ...........................................27

Deposit Insurance ................................................................................................................28

Supervision...........................................................................................................................31

Research ............................................................................................................................... 51

Community Banking ............................................................................................................54

Activities Related to Large and Complex Financial Institutions ........................................57

Depositor and Consumer Protection ..................................................................................66

Failed Bank Resolution and Receivership Management....................................................79

Minority Depository Institutions and Community Development Financial Institutions ..85

Diversity, Equity, Inclusion, and Accessibility.....................................................................88

Information Technology Modernization .............................................................................92

International Outreach ........................................................................................................96

Effective Management of Strategic Resources ...................................................................98

II. Performance Results Summary .................................................................... 101

Summary of 2023 Performance Results by Program .......................................................103

Performance Results by Program and Strategic Goal......................................................103

III. Financial Highlights..................................................................................... 121

Deposit Insurance Fund Performance ..............................................................................123

IV. Budget and Spending................................................................................... 127

2023 FDIC Operating Budget .............................................................................................128

2023 Budget and Expenditures by Program.....................................................................129

Investment Spending.........................................................................................................130

V. Financial Section......................................................................................... 131

Deposit Insurance Fund (DIF) ............................................................................................132

FSLIC Resolution Fund (FRF)..............................................................................................148

Government Accountability Office Auditor’s Report .......................................................155

Management’s Report on Internal Control over Financial Reporting ............................. 161

Management’s Response to the Auditor’s Report............................................................162

VI. Risk Management and Internal Controls........................................................ 163

Program Evaluation ...........................................................................................................166

Internal Control Program – Fraud Risk Management.......................................................168

Management Report on Final Actions...............................................................................168

VII. Appendices................................................................................................. 177

A. Key Statistics.................................................................................................................. 178

B. More About the FDIC......................................................................................................190

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

Performance Challenges Facing the FDIC ..................................................................... 201

D. Acronyms ....................................................................................................................... 241
MISSION, VISION, AND VALUES

MISSION

The Federal Deposit Insurance Corporation (FDIC) is an independent agency created by 

Congress to maintain stability and public confidence in the nation’s financial system by:

 Insuring deposits,

 Examining and supervising financial institutions for safety and soundness 

and consumer protection,

 Making large and complex financial institutions resolvable, and

 Managing receiverships.

VISION

The FDIC is a recognized leader in promoting sound public policies; addressing risks 

in the nation’s financial system; and carrying out its insurance, supervisory, consumer 

protection, resolution planning, and receivership management responsibilities.

VALUES

The FDIC and its employees have a tradition of distinguished public service. Six core 

values guide us in accomplishing our mission:

Integrity We adhere to the highest ethical and professional standards.

Competence We are a highly skilled, dedicated, and diverse workforce that is 

empowered to achieve outstanding results.

Teamwork We communicate and collaborate effectively with one another and 

with other regulatory agencies.

Effectiveness We respond quickly and successfully to risks in insured depository 

institutions and the financial system.

Accountability We are accountable to each other and to our stakeholders to operate 

in a financially responsible and operationally effective manner.

Fairness We respect individual viewpoints and treat one another and our 

stakeholders with impartiality, dignity, and trust.
MESSAGE FROM THE CHAIRMAN

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 5 

February 22, 2024

The FDIC marked its 90th anniversary since 

President Franklin D. Roosevelt signed the 

Banking Act of 1933, establishing the FDIC as 

the first national deposit insurance system. 

Against the backdrop of the Great Depression 

and the failure of thousands of banks, the 

FDIC was created to maintain financial 

stability and public confidence in our nation’s 

banks. This mission took on heightened 

importance in 2023, which saw the agency 

manage three of the largest FDIC-insured 

bank failures in its history. 

Throughout this challenging year, the FDIC 

workforce carried out its mission-essential 

functions—insuring deposits; supervising 

and examining financial institutions for 

safety, soundness, and consumer protection; making large firms resolvable; and managing 

failed bank receiverships—with the professionalism, proficiency, integrity, and resilience that 

has characterized its history. 

Following is an overview of developments in a number of critical areas over the past year, as 

well as the current economic and financial outlook, and the FDIC’s operational status. 

Ensuring a Safe, Fair, and Inclusive Work Environment

FDIC’s mission success this year and over the last 90 years is because of our people. Ensuring 

that the FDIC workplace and culture align with our core values and that our employees feel 

safe, valued, and respected is my highest priority as Chairman. And, maintaining a strong 

workplace culture is essential to effectively carrying out our mission.

Since November 2023, following news reports about sexual harassment at the FDIC, we 

have developed and begun to implement an Action Plan for a Safe, Fair, and Inclusive Work 

Environment that describes how the FDIC will support victims of sexual harassment and 

discrimination. The plan, incorporating feedback from our employees, specifies a number of 

action items related to identifying and correcting existing problems, repercussions for those 

engaged in sexual harassment or other serious misconduct, leadership accountability, review 

of policies and procedures, training programs, communication and outreach strategies, and 

cultural transformation. 

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

independent third-party review of the agency’s workplace culture. Directors Jonathan 

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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 6 

McKernan and Michael J. Hsu, Acting Comptroller of the Currency, are co-chairs of the 

special committee. In December, the committee selected the law firm of Cleary Gottlieb 

Steen & Hamilton LLP to conduct the independent review, which will cover allegations 

of sexual harassment and interpersonal misconduct at the FDIC, including allegations of 

hostile, abusive, unprofessional, or inappropriate conduct, and management’s response 

to that harassment and misconduct. The review will also assess the FDIC’s workplace 

culture, including any practices that might discourage or otherwise deter the reporting of, or 

appropriate response to, harassment and interpersonal misconduct. 

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

Action Plan as appropriate.

The Current Outlook for the Banking System

At the end of September 2023, the FDIC insured deposits of $10.6 trillion in approximately 720 

million accounts at 4,623 institutions and supervised 2,952 institutions. As of December 31, 

2023, the FDIC is managing 74 active receiverships with total assets of nearly $84.6 billion. 

The banking industry has proven to be quite resilient despite the period of stress in early 

2023. Net income was high by historical measures, asset quality measures were favorable, 

and the industry remained well capitalized. However, funding pressures continue to challenge 

the industry, particularly for small and mid-sized banks. Nine new banks opened through 

December 2023, and five banks failed. 

The FDIC will continue to monitor the significant downside risks from the effects of inflation, 

elevated market interest rates, and geopolitical uncertainty. Moreover, the economic outlook 

remains uncertain, despite relatively solid growth and low unemployment. These risks could 

cause credit quality and profitability to weaken, loan growth to slow, provision expenses to 

rise, and liquidity to become more constrained. 

In addition, commercial real estate (CRE) loan portfolios, particularly loans backed by office 

properties, face challenges when loans mature as demand for office space remains weak and 

property values continue to soften. Banks have tightened underwriting standards over the 

past year across a range of household and business loans, and they may continue to tighten 

further this year.

These will be matters of continued supervisory attention by the FDIC.

The Failures of Silicon Valley Bank, Signature Bank, 

and First Republic Bank

In the first half of the year, three large regional banks failed. Actions taken by the FDIC, Board 

of Governors of the Federal Reserve System (Federal Reserve or FRB), and the Secretary of the 

Treasury in consultation with the President stabilized the banking system, stemmed potential 

contagion from the failures, and ensured that depositors continued to have access to their 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 7 

savings, that small businesses and other employers could continue to make payrolls, and that 

other banks could continue to extend credit to borrowers and serve as a source of support. 

Throughout this particularly challenging time, the FDIC workforce demonstrated a high degree 

of proficiency, readiness, and fortitude and effectively carried out its mission for the American 

public. 

On March 10, 2023, the California Department of Financial Protection and Innovation closed 

Silicon Valley Bank (SVB) of Santa Clara, California. This action followed two days after SVB 

announced that it had sold securities at a loss to meet deposit withdrawals since the second 

quarter of 2022 and planned to raise capital. This prompted a run on the bank’s uninsured 

deposits, on which it was 90 percent reliant. In a period of less than 24 hours, depositors 

withdrew or sought to withdraw nearly all of SVB’s deposits.

Contagion effects from SVB’s failure began to spread to other banks with perceived similar 

risk characteristics, including heavy reliance on uninsured deposits. For two of these banks 

— Signature Bank, New York, New York and First Republic Bank, San Francisco, California 

— deposit outflows became deposit runs and exposed other weaknesses that could not 

be overcome, leading to their failures. Signature Bank was closed by the New York State 

Department of Financial Services on March 12, 2023. Seven weeks later, First Republic Bank 

was closed by the California Department of Financial Protection and Innovation on May 1. The 

FDIC was appointed as receiver for all three institutions.

The contagion effect through uninsured deposits threatened additional bank failures and 

posed genuine financial stability risk. A significant number of the uninsured depositors at SVB 

and Signature Bank were small and medium-sized businesses. As a result, there were concerns 

that losses to these depositors would put them at risk of not being able to make payroll and 

pay suppliers. Moreover, with the liquidity of banking organizations further reduced and their 

funding costs increased, banking organizations could become even less willing to lend to 

businesses and households. These effects would contribute to weaker economic performance, 

further damage financial markets, and have other material negative effects.

Faced with these risks, the FDIC Board voted unanimously on March 12, to recommend 

that the Secretary of the Treasury, in consultation with the President, make a systemic risk 

determination under the Federal Deposit Insurance (FDI) Act with regard to the resolutions of 

SVB and Signature Bank. That same day, the Board of the Federal Reserve unanimously made 

a similar recommendation. Thereafter, the Secretary of the Treasury, in consultation with 

the President, determined that complying with the least-cost requirements in the FDI Act 

would have serious adverse effects on economic conditions or financial stability, and any 

action or assistance taken under the systemic risk exception would avoid or mitigate such 

adverse effects.

This determination enabled the FDIC to extend deposit insurance protection to all of the 

depositors of SVB and Signature Bank, including uninsured depositors, in winding down the 

two failed banks. The senior management and boards of the failed banks were removed, the 

shareholders lost their investments, and creditors took losses in accordance with the losses 

of these banks. The cost to the Deposit Insurance Fund of protecting the uninsured 

depositors will be paid for through a special assessment on the banking industry, consistent 

with the statute.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 8 

Subsequently, when the failing First Republic Bank was resolved on May 1, 2023, the acquiring 

bank assumed all of the deposits and substantially all of the assets of First Republic Bank in a 

transaction that met the least cost requirements of the FDI Act.

At my request, the FDIC’s Chief Risk Officer conducted thorough internal reviews of the 

agency’s supervision of Signature Bank and First Republic Bank. The Signature Bank review 

clearly identified the root cause of Signature Bank’s failure as poor management. In the 

case of First Republic Bank, the primary cause of failure was found to be a loss of market 

and depositor confidence, resulting in a bank run. Attributes of the bank’s business model 

and management strategies, concentrated in long-term jumbo mortgages, made it more 

vulnerable to interest rate changes and the contagion that ensued following the failure of SVB.

In both cases, the FDIC reviews identified areas where its supervisory efforts could have been 

more timely and forward looking, and identified lessons learned affecting a range of safety 

and soundness and supervisory issues for further consideration, including interest rate risk, 

unrealized losses on securities and loans, concentrations of uninsured deposits, rapid growth, 

and escalation of supervisory attention and compelling compliance if necessary. 

Managing the Deposit Insurance Fund (DIF)

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

provisions for the five bank failures during the year. Following the failure of two large banks in 

March 2023, the banking industry experienced outflows of total deposits, but also experienced 

strong insured deposit growth. This growth in insured deposits, coupled with the decline in 

the DIF balance, resulted in a decline in the fund reserve ratio from 1.23 percent at September 

30, 2022 to 1.13 percent as of September 30, 2023. The reserve ratio is the ratio of the DIF 

balance to total insured deposits in the United States. 

A total of five banks failed in 2023, resulting in a combined estimated loss at December 31 of 

$40.4 billion. As of December 2023, the FDIC estimated the cost for the failures of SVB and 

Signature Bank to total $23.6 billion. Of that estimated total cost, the FDIC estimates that 

approximately $20.4 billion was attributable to the cost of covering uninsured deposits as a 

result of the systemic risk determinations, following the closures of SVB and Signature Bank. 

These loss estimates will be periodically adjusted as assets are sold, liabilities are satisfied, 

and receivership expenses are incurred. The final cost will be determined when the FDIC 

terminates the receivership.

By statute, the FDIC is required to recover the $20.4 billion estimated loss arising from the 

use of a systemic risk determination through one or more special assessments. Accordingly, 

in November 2023, the FDIC Board approved a final rule under which the FDIC will collect the 

special assessment at an annual rate of 13.4 basis points beginning with the first quarterly 

assessment period of 2024 (i.e., January 1 through March 31, 2024) with an invoice payment 

date of June 28, 2024, and will continue to collect special assessments for an anticipated 

total of eight quarterly assessment periods. The special assessment amount and collection 

period may change as the estimated loss is periodically adjusted or if the amount collected 

each quarter changes. The base for the special assessment is equal to an insured depository 

institution’s (IDI’s) estimated uninsured deposits for the December 31, 2022 reporting period.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 9 

The FDIC estimates that a total of 114 banking organizations will be subject to the special 

assessment. No banking organizations with total assets under $5 billion will pay the special 

assessment. Banks with assets over $50 billion will pay 95 percent of the special assessment.

The remaining estimated loss from the failures of SVB and Signature Bank of $3.2 billion, as 

well as, estimated losses of $16.7 billion from the May 2023 closure of First Republic Bank, 

directly impacted the DIF balance.

As required by the Federal Deposit Insurance Act, the FDIC has been operating under a 

Restoration Plan since September 15, 2020, which aims to restore the DIF to the statutory 

minimum reserve ratio of 1.35 percent within eight years. Notwithstanding the recent 

losses due to bank failures and growth in insured deposits, the DIF remains on track to 

meet the statutory minimum reserve ratio of 1.35 percent by the eight-year deadline of 

September 30, 2028.

Exploring Deposit Insurance System Reform

The failures of SVB and Signature Bank, and the approval of the two recommendations for 

Systemic Risk Exceptions to the Least Cost Test, raised fundamental questions about the role 

of deposit insurance in the U.S. banking system. The events of March 2023 further suggest 

that the banking system has evolved in ways that could increase its exposure to deposit runs. 

To address the broader questions about the role of deposit insurance to promote financial 

stability and prevent bank runs, the FDIC initiated a comprehensive review to examine the role 

of deposit insurance and a range of potential changes, as well as additional policies and tools 

that may complement changes to deposit insurance coverage.

The resulting report, Options for Deposit Insurance Reform,

1

 evaluated three options to reform 

the deposit insurance system: 1) Limited Coverage, which maintains the current structure 

of deposit insurance in which there is a finite deposit insurance limit (possibly higher than 

the current $250,000 limit) by ownership rights and capacities; 2) Unlimited Coverage, which 

extends unlimited deposit insurance to all depositors; and 3) Targeted Coverage, which allows 

for different levels of deposit insurance coverage across different types of accounts and 

focuses on higher coverage for business payment accounts. 

Although each option has strengths and weaknesses, Targeted Coverage for business payment 

accounts captures many of the financial stability benefits of expanded coverage while 

mitigating many of the undesirable consequences. However, there are significant unresolved 

practical challenges to Targeted Coverage, including defining accounts for additional coverage 

and preventing depositors and banks from circumventing differences in coverage.

The report also underscores the important role that supervision and regulation play in limiting 

the risks to the deposit insurance system. 

1 Options for Deposit Insurance Reform is available at https://www.fdic.gov/analysis/options-deposit-insurancereforms/index.html. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 10 

Any option to expand deposit insurance coverage would require Congressional action. 

The FDIC remains committed to engaging with the public, as well as with stakeholders in 

the industry and with policymakers in the Congress as policies to strengthen the deposit 

insurance system and meet emerging challenges are considered.

Strengthening the Community Reinvestment Act

In October, the FDIC, Federal Reserve, and Office of the Comptroller of the Currency (OCC) 

adopted a final rule to strengthen and modernize the Community Reinvestment Act (CRA). The 

final rule represents an ambitious effort to adapt CRA to the dramatically changed nature of 

the banking business since the law’s enactment in 1977 and the last major rule change in 1995. 

Most of the rule’s requirements will be applicable beginning January 1, 2026. The remaining 

requirements will be applicable on January 1, 2027.

First, banks today no longer serve their customers exclusively through a branch-based 

network around which CRA assessment areas are currently drawn. They increasingly interact 

with customers either online or through mobile phones in areas in which the bank may not 

have a physical presence, including so-called “banking deserts,” which include rural and other 

underserved areas, Native Land areas, and low- and moderate-income communities. Lending 

by banks in such areas has not been subject to a CRA evaluation.

The final rule adapts to this new banking reality by requiring large banks to establish Retail 

Lending Assessment Areas (RLAAs) in those geographies outside of their physical footprint 

where they originate significant numbers of closed-end mortgage loans or small business 

loans.

Under the final rule, the loans in these new assessment areas will be subject to CRA review and 

evaluation for the first time, ensuring that large banks serve all segments of the communities 

in which they are chartered to do business. This represents a critically important adaptation of 

CRA to the changing nature of the business of banking.

Second, the final rule establishes a series of metrics and benchmarks against which banks 

will be measured for CRA performance for lending and community development. This will 

allow the banking agencies to establish specific standards for bank performance to achieve 

a particular CRA rating that will provide an incentive for increased lending to underserved 

communities. It will also provide greater clarity, transparency, and predictability for the banks 

and the public, as well as consistency among the agencies.

Third, the final rule tailors CRA evaluations and data collection to bank size, complexity, and 

business type. For instance, small banks would continue to be evaluated under the existing 

regulatory framework but would have the option to be evaluated under aspects of the new 

regulation. However, large banks with assets over $2 billion will have to collect and report 

community development data, and large banks over $10 billion in assets will have additional 

data collection and reporting requirements relating to deposits and retail banking products.

Fourth, the final rule recognizes the importance of minority depository institutions (MDIs), 

Treasury Department-certified Community Development Financial Institutions (CDFIs), 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 11 

Women’s Depository Institutions (WDIs), and Low Income Credit Unions (LICUs) in providing 

financial access to underserved consumers and communities.

For example, the final rule creates a specific community development definition for eligible 

activities, such as investments, loan participations, and other ventures conducted by all 

banks with these institutions, including by other MDIs, WDIs, or CDFI banks. All community 

development activities conducted by banks with these entities will get CRA credit under the 

final rule.

Fifth, in order to promote transparency, the final rule will require large banks to disclose 

the distribution of home mortgage loan originations and applications in each of the bank’s 

assessment areas by income, race and ethnicity. This aspect of the final rule is intended to 

provide transparent information to the public in regard to the bank’s lending to communities 

of color. Although the data disclosed would not have an impact on the CRA ratings of the 

bank, it would allow the public to compare lending by a bank in those communities to other 

communities, as well as allow comparisons to other banks.

Sixth, while we know that technology has led to significant changes in the provision of bank 

services, bank branches continue to play a crucial role for consumers and communities. For 

example, just over three-quarters of closed-end mortgages originated by large banks in recent 

years were located in branch-based assessment areas. These branch-based assessment areas 

remain a foundation of CRA. Under the final rule, each banking agency will be required to 

evaluate a bank’s record of opening and closing branches to inform the degree of accessibility 

of banking services to low- and moderate-income communities.

Further, the final rule will provide positive CRA consideration to large banks for the offering 

and demonstrated consumer usage of low-cost transaction accounts—accounts with low or no 

minimum balance requirements and no overdraft fees—such as Bank On Certified accounts.

Finally, the rule gives credit to community development activities designed to strengthen 

disaster preparedness and weather resiliency in low- and moderate-income communities. 

These activities may include supporting the establishment of flood control systems in a flood 

prone area, and retrofitting affordable housing to better withstand future disasters or climaterelated events.

The new rule will significantly expand the scope and rigor of CRA and will assure its continued 

relevance for the next generation.

Finalizing the Basel III Capital Rules

Finalizing the Basel III reforms is critical for the safety and soundness of the U.S. banking 

system, financial stability, and the performance of the U.S. economy.

In July, the FDIC, with the FRB and OCC, issued a proposed rulemaking that would modify large 

bank capital requirements to better reflect underlying risks and increase the transparency and 

consistency of the regulatory capital framework. Specifically, the proposal would revise the 

capital framework for banks with total assets of $100 billion or more in four areas: credit risk, 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 12 

market risk, operational risk, and credit valuation adjustment risk. Community banks would 

not be impacted by the proposal.

The proposal also takes into account lessons from the banking turmoil in March of this year 

by seeking to apply a consistent set of capital requirements across large banks. Banks with 

total assets of $100 billion or more would be required to include unrealized gains and losses 

from certain securities in their capital ratios; comply with the supplementary leverage ratio 

requirement; and comply with the counter cyclical capital buffer, if activated. 

The comment period on the proposal closed on January 16, 2024. I look forward to carefully 

considering the comments received and working with the other federal banking agencies to 

finalize and implement Basel III. These important changes to the regulatory capital framework 

will enhance the financial resilience and stability of the banking system, better enabling it to 

serve the U.S. economy.

Addressing Financial Risks Posed by Climate Change

Climate-related trends, including rising sea levels, increases in the frequency and severity of 

extreme weather events, and other natural disasters, as well as the transition to lower carbon 

emitting sources of energy, continue to present challenges for the future resiliency of the 

financial system and banking industry and may pose safety and soundness risks to individual 

banks. Throughout 2023, the FDIC continued its work to ensure that the financial system 

remains resilient despite these rising risks. 

In October, the FDIC, Federal Reserve, and OCC adopted interagency guidance for large 

financial institutions that includes a high-level framework for the safe and sound management 

of exposures to climate-related financial risks. The guidance provides general principles with 

respect to governance; policies, procedures, and limits; strategic planning; risk management; 

data, risk measurement, and reporting; and scenario analysis. It also provides guidance on 

how climate-related financial risks can be addressed in the management of traditional risk 

areas, i.e., credit, liquidity, operational risk, and legal and compliance risks.

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

those with over $100 billion in total consolidated assets. We understand smaller institutions, 

including community banks, may have limited resources and may experience the impacts of 

climate-related financial risks in a manner that differs from large financial institutions.

The FDIC does not make environmental policy, nor does it determine firms or sectors with 

which financial institutions should do business. Financial institutions should fully consider 

climate-related financial risks—as they do all other risks—and continue to take a risk-based 

approach in assessing individual credit and investment decisions. The FDIC expects financial 

institutions to manage climate-related financial risks in a manner that will allow them to 

continue to prudently meet the financial services needs of their communities, including lowand moderate-income and other underserved consumers and communities.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 13 

Providing Regulatory Relief in Disaster Areas

In 2023, the FDIC provided flexibility to financial institutions in 16 states and territories, where 

communities were affected by severe storms, flooding, tornadoes, wildfires, mudslides, 

typhoons, hurricanes, and other disasters. The FDIC supported financial institutions’ efforts 

to meet customers’ cash and other financial needs by providing flexibility on lending and 

credit policies and more. As these areas continue to recover, the FDIC encourages depository 

institutions to consider all reasonable and prudent steps to assist their customers, consistent 

with safe and sound banking practices. 

Reviewing the Bank Merger Process

The FDIC also continues its efforts to evaluate the effectiveness of the regulatory framework 

for implementing the Bank Merger Act (BMA) of 1960. That framework generally requires 

approval by the FDIC, Federal Reserve, or OCC, as appropriate, for bank mergers after 

consideration of certain specific statutory factors. FDIC approval is also required for a bank 

merger with a non-insured entity. 

Although there has been a significant amount of consolidation in the banking sector over the 

last 30 years, facilitated in part by mergers and acquisitions—and the prospect for continued 

consolidation among both large and small IDIs remains significant—there has not been a 

significant review of the implementation of the BMA in that time. 

The FDIC continues to evaluate and consider comments received in response to a Request 

for Information and Comment on Rules, Regulations, Guidance, and Statements of Policy 

Regarding Bank Merger Transactions published in March 2022. 

In addition, the FDIC is coordinating with the Federal Reserve, OCC, and Department of Justice 

regarding an interagency review of the existing laws, regulations, guidance, and processes 

used by the federal banking agencies under the BMA. These discussions, which are ongoing, 

are consistent with the Presidential Executive Order on Promoting Competition in the 

American Economy. 

Evaluating and Addressing Crypto-Asset Risks to the 

Banking System

The risks associated with crypto-asset activities by banks are novel and complex, and may 

involve safety and soundness, consumer protection, anti-money laundering and the Bank 

Secrecy Act, and potentially financial stability issues. As a result, the FDIC, in coordination 

with the other federal banking agencies, has taken steps to closely monitor crypto-assetrelated activities of banking organizations. For example, the FDIC has issued statements to 

assist banking organizations in ensuring that they have put in place appropriate measures and 

controls to identify and manage risks and comply with all relevant laws.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 14 

The FDIC requested that all supervised institutions that are considering engaging in, or are 

already engaged in, crypto-asset-related activities notify the FDIC and provide all necessary 

information that would allow the FDIC to assess the safety and soundness, consumer 

protection, anti-money laundering/countering the financing of terrorism, and financial 

stability risks in order to provide supervisory feedback to the institution.

The FDIC also advised all FDIC-insured institutions of the risks of consumer confusion or harm 

arising from crypto-assets offered by, through, or in connection with insured depository 

institutions. These concerns were elevated as a result of certain misrepresentations about 

FDIC deposit insurance by some crypto companies. Inaccurate representations about deposit 

insurance by non-banks, including crypto companies, may confuse consumers and cause 

them to mistakenly believe that these investments are protected by deposit insurance. To 

counter this confusion, the FDIC released consumer education materials advising the public 

that crypto-assets are not deposits insured by the FDIC. In addition, over the course of 

2023, the FDIC issued several cease and desist letters that resulted in companies removing 

misrepresentations about the insured status of crypto products. 

In early 2023, the FDIC, along with the Federal Reserve and the OCC, issued two joint 

statements on crypto-assets. The first, issued in January 2023, addressed several risks posed 

by crypto-assets, including significant volatility in crypto-asset markets; risk management and 

governance practices in the crypto-asset sector exhibiting a lack of maturity and robustness; 

and inaccurate or misleading representations or disclosures by crypto-asset companies; 

among others. Our second joint statement, issued in February 2023, highlighted key liquidity 

risks associated with certain sources of funding from crypto-asset-related entities. 

The agencies continue to emphasize that banking organizations are neither prohibited nor 

discouraged from providing banking services to customers of any specific class or type, as 

permitted by law or regulation. 

Supporting Diversity, Equity, Inclusion, and Accessibility 

Supporting diversity, equity, inclusion, and accessibility (DEIA) enhances the FDIC’s ability to 

carry out its core mission. It is essential that the FDIC’s workforce reflect the diversity and 

experiences of the public it serves. 

Throughout 2023, the FDIC made further progress in implementing corporate DEIA initiatives 

as outlined in our DEI Strategic Plan, including launching empathy training for all employees. 

We also focused on enhancing our recruitment and retention of Hispanic employees and 

addressing female workforce participation. The FDIC remains committed to recruiting 

strategically to reach all available talent in the labor market, providing advancement 

opportunities to current employees, and enhancing employee engagement at all levels.

The FDIC’s commitment to DEIA in the broader financial industry is reflected through our 

Financial Institution Diversity Self-Assessment program. This program supports the efforts 

of supervised institutions to create and grow their diversity programs, allowing them to build 

strong relationships with their clients and communities, maximize workforce representation, 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 15 

and develop and implement inclusion efforts. In 2023, we continued our outreach to 

community banks and trade associations to increase awareness and participation in the 

assessment program, and we launched “office hours,” an initiative to provide more hands-on 

technical assistance to the financial institutions and to increase voluntary participation. 

Supporting Minority Depository Institutions (MDIs) and

Community Development Financial Institutions (CDFIs)

The preservation and promotion of MDIs and CDFIs remains a long-standing priority for the 

FDIC, due to the vital role they play in providing mortgage credit, small business lending, and 

other banking services to minority and low- and moderate-income communities. Similarly, 

banks designated as CDFIs by the Treasury’s CDFI Fund provide financial services in lowincome communities and to individuals and businesses that have traditionally lacked access 

to credit. 

The FDIC supervises approximately two-thirds of the 312 FDIC-insured MDIs and CDFIs. 

In addition to its supervisory activities, the FDIC’s Office of Minority and Community 

Development Banking supports the agency’s ongoing strategic and direct engagement with 

MDIs and CDFIs. 

Over the past five years, six de novo MDIs opened their doors (two Asian, one Native American, 

one African American, and two Multi–racial) and 17 existing institutions became newly 

designated MDIs due to changes in control or in board composition. These additions to the MDI 

list mostly offset removals from the list due to mergers, changes in control, or other events 

that caused institutions to lose their MDI eligibility. 

As significant new sources of private and public funding have become available to support 

FDIC–insured MDIs and CDFIs, the FDIC has supported these institutions access to this funding 

through regulatory changes and technical assistance training.

In addition, in November, the FDIC hosted an interagency conference with the OCC and the 

Federal Reserve to facilitate potential partnerships among FDIC-insured MDIs and CDFIs and 

large and regional banks supervised by the FDIC, Federal Reserve, and OCC. The conference 

featured an overview of the new CRA rule and benefits for partnering with mission-driven 

banks. More than 100 FDIC-insured MDIs and CDFI banks participated, in addition to more than 

65 FDIC-insured large and regional banks.

Expanding Access to Banking Services and 

Understanding of Deposit Insurance

Helping Americans understand the benefits of deposit insurance and expanding their access 

to mainstream banking services help strengthen confidence in the nation’s financial system—

the FDIC’s core mission. 
MESSAGE FROM THE CHAIRMAN

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 16 

Last year, our National Survey of Unbanked and Underbanked Households found that, despite 

the economic challenges posed by the COVID-19 global pandemic, nearly 96 percent of U.S. 

households are banked. Approximately 4.5 percent of households lacked a bank or credit 

union account, which is the lowest national unbanked rate since the survey began in 2009. 

These results are encouraging, but significant work remains to be done to address large 

disparities that exist in the United States with regard to access to the banking system: 

11.3 percent of Black households and 9.3 percent of Hispanic households were unbanked, 

according to the most recent survey, compared to 2.1 percent of White households. Other 

populations also have lower levels of bank engagement, including lower-income households, 

households with lower levels of formal education, single mothers, and households headed by

a working-age individual with a disability. 

These populations can be reached by taking advantage of bankable moments and by ensuring 

that consumers are aware of, and able to locate and open, bank accounts that can meet their 

needs. We continue to host events, including webinars, workshops, and roundtables, across 

the country that aim to highlight opportunities for local organizations to reach unbanked 

populations.

In addition, in October, we launched a public awareness campaign—“Know Your Risk. Protect 

Your Money.”—that aims to reach consumers who may have lower confidence in the banking 

system or who are unbanked, as well as those who use mobile payment systems, alternative 

banking services, and financial products that may appear to be FDIC-insured but are not.

Following the failure of SVB, Signature Bank, and First Republic Bank earlier this year, a Gallup 

poll found nearly half of Americans surveyed are worried about the safety of their money 

deposited into banks and other financial institutions. We recognized this opportunity to reach 

out to the public and ensure that more consumers understand deposit insurance and how 

it protects their money. Our public awareness campaign addresses that knowledge gap by 

referring consumers to educational material offered in English and Spanish. 

The campaign also responds to an increase in instances of firms or individuals misusing the 

FDIC’s name or logo, or making false or misleading representations about deposit insurance, 

raising confusion among consumers about the insurability of nonbanks and crypto-assets.

We will continue the campaign into 2024 to coincide with the start of traditional tax filing 

season, when many consumers receive refund payments—a key opportunity to open an 

account and realize the benefits of deposit insurance. 

Cybersecurity Threats from malicious cyber actors continue to be a significant and evolving risk for banks 

and their service providers. Evaluating cybersecurity practices continues to be a highpriority focus of the FDIC’s supervision program. During 2023, the FDIC conducted 1,243 IT 

examinations at state nonmember institutions and issued four formal enforcement actions. 
MESSAGE FROM THE CHAIRMAN

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 17 

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

In addition to routine examination procedures, in 2023, the FDIC, Federal Reserve, and OCC 

horizontally reviewed the supply chain risk of the most significant service providers. 

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

cybersecurity threats and other operational risk issues. In October, the FDIC hosted on 

behalf of the Federal Financial Institutions Examination Council (FFIEC) a national banker 

webinar covering cybersecurity awareness with guest speakers from the Federal Bureau of 

Investigation. We also released cybersecurity informational videos for bank directors, bank 

officers, and staff.

Internally, in 2023, the FDIC made significant progress towards adopting the Zero Trust 

Cybersecurity Principles to safeguard its operations and the critical data it manages. This 

progress represents continuous improvement in the agency’s enterprise security posture and 

enhancements in our ability to provide secure and accurate data access. 

Emerging Technology

The FDIC continues to dedicate significant resources to identifying and understanding 

emerging technologies and the implications for financial institutions and their customers 

to ensure the FDIC is prepared to address the changing landscape in financial products 

and services. Since 2016, these efforts have been led by the FDIC’s Emerging Technology 

Steering Committee, which is supported by two staff-level working groups. The committee is 

composed of the Directors of the Divisions of Risk Management Supervision (RMS), Depositor 

and Consumer Protection (DCP), Insurance and Research, Resolutions and Receiverships, 

and Complex Institution Supervision and Resolution, as well as the General Counsel, Chief 

Financial Officer, Chief Innovation Officer, Chief Risk Officer, and Chief Information Officer. The 

Steering Committee met eight times during 2023, and discussed a number of topics, including 

the Executive Order on Artificial Intelligence, various crypto-asset scams used by fraudsters, 

Fed Now, various technology offerings and use cases, and various aspects of distributed 

ledger technology, including oracles and smart contracts. For example, throughout 2023, the 

Steering Committee helped formulate strategies to respond to opportunities and challenges 

presented by emerging technology and to ensure developments align with regulatory and 

supervisory goals. 

Throughout 2023, the Emerging Technology Steering Committee continued work on its 

established objectives through its staff-level working groups to: 

 Comprehend, assess, and monitor the current emerging technology activities, 

risks, and trends; 

 Evaluate the projected impact of emerging technology on the banking system, the 

deposit insurance system, effective regulatory oversight, economic inclusion, and 

consumer protection; 

 Oversee internal working groups monitoring particular aspects of emerging 

technology; 
MESSAGE FROM THE CHAIRMAN

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 18 

 Recommend follow-up actions, as appropriate, and monitor implementation; and 

 Help formulate strategies to respond to opportunities and challenges presented 

by emerging technology and to ensure developments align with regulatory goals.

Building on the Steering Committee’s efforts, since 2020, the Emerging Technology & AML/

Cyber Fraud Policy Group within the Legal Division has focused on legal issues facing both the 

FDIC and the banking industry arising from emerging forms of technology, such as blockchain 

and artificial intelligence. In addition, in 2023, the FDIC established the Emerging Technology 

Section in RMS to provide examination support and lead policy development related to 

emerging technologies. Similarly, in 2023, the FDIC established the Technology Enterprise 

and Consumer Harm Risk and Innovation Section in DCP to expand technical knowledge and 

supervision capabilities. Separately, throughout the year, staff in RMS and DCP met with 

financial technology companies interested in doing business with financial institutions. 

In addition, the FDITECH group in the CIO organization serves a critical function supporting 

the identification, testing, and adoption of innovative technologies within the FDIC to 

improve the delivery of its core mission responsibilities. FDITECH engages with stakeholders 

throughout the FDIC to identify problems and challenges in programs and operations, and 

conducts proofs of concept aimed at removing barriers and building IT capabilities. This 

includes the evaluation and adoption of technologies that enable the FDIC to keep pace with 

developments within the banking industry. For example, FDITECH is providing Divisions and 

Offices access to unbiased expertise and assistance to collaboratively identify, refine and 

prioritize potential uses of distributed ledger technology (DLT). This effort enables the FDIC to 

identify and analyze risks that DLT can pose to regulated institutions, their customers, and the 

Deposit Insurance Fund, as well as the effects on resolution and receivership activities.

Furthermore, as data becomes more valuable over time, FDITECH is also focused on how to 

best utilize data and technology to meet the demands of the agency. 

In 2024, the FDIC will continue to explore the potential application of new and emerging 

technologies, automations, and process improvements by:

 Exploring the utility and application of robotic process automation and AI to 

reduce the time required to complete manual work; and

 Developing potential use cases that allow employees to learn about distributed 

ledger technologies through hands-on experience. 

Managing FDIC Resources and Operations 

As of March 2023, the FDIC has largely returned to pre-pandemic business operations, 

operating in a hybrid work posture that includes an in-person component for each safety and 

soundness and consumer compliance examination. We have announced that we will transition 

to an even greater on-site presence at our office facilities starting in July 2024.
MESSAGE FROM THE CHAIRMAN

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 19 

In December, the FDIC Board adopted a 2024 Operating Budget of $3.0 billion, which 

represents a 6.3 percent decrease from last year’s budget. The budget reflects a 57.5 percent 

decrease in the Receivership Funding component of the budget and an increase of 12 percent 

in the Ongoing Operations component. The budget also authorizes 189 new positions, many 

of which are being added to increase the monitoring and supervision of large banks to support 

early detection of emerging risks and quicker action to ensure that banks are taking the 

necessary steps to mitigate such risks. This increase will bring the 2024 authorized staffing 

total to 6,817. 

The budget provides additional resources to address potential risks to depositors and 

consumers of emerging technologies that are beginning to be used by banks, such as the use 

of artificial intelligence in credit underwriting models. It also includes funding to support 

planned efforts to educate the public about deposit insurance and to continue our multi–year 

IT Modernization Program and our multi–year Facilities Modernization effort. Both of these 

initiatives are critical to ensuring that the FDIC’s future workforce will have the tools and 

resources needed to continue fulfilling our important mission.

Conclusion

This has been a challenging year for the FDIC. However, despite the period of uncertainty 

earlier in 2023, the banking system has remained a source of strength for consumers, 

households, and businesses.

In 2024, the FDIC will carry out its mission to maintain public confidence and stability in 

the U.S. financial system and address risks faced by the banking system by maintaining a 

strong deposit insurance system, examining and supervising financial institutions for safety 

and soundness and consumer protection, making large and complex financial institutions 

resolvable, and managing receiverships. 

We will also be looking inward in 2024 to address the issues in our workplace culture that have 

come to light in recent months. None of the accomplishments outlined in this report would 

be possible without the hard work and commitment of the FDIC workforce. Our employees 

deserve a workplace where they feel safe and valued. 

I am committed to achieving this for our employees, and I remain grateful for their dedication 

to the mission of the FDIC. 

Sincerely,

Martin J. Gruenberg
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MESSAGE FROM THE CHIEF FINANCIAL OFFICER

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 21 

February 22, 2024

I am pleased to present the FDIC’s 2023 Annual Report, which 

covers financial and program performance information and 

summarizes our successes for the year.

For 32 consecutive years, the U.S. Government Accountability 

Office has issued unmodified 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 accomplishments 

and continue to consistently demonstrate discipline and 

accountability as stewards of these funds. We remain proactive 

in the execution of sound financial management by providing reliable and timely financial data 

to enhance decision-making and employing tools and strategies to improve the effectiveness 

and efficiency of our financial management operations and reporting.

2023 Financial and Program Results

During the first half of 2023, the FDIC resolved three of the largest bank failures in U.S. history. 

In total, five institutions failed over the course of the year. Total estimated losses affecting 

the DIF from the 2023 failures were $20.0 billion. Despite this significant failure activity, 

and continued economic and geopolitical uncertainties, the banking industry continues to 

demonstrate resilience.

The DIF balance declined from a record high of $128.2 billion as of December 31, 2022 to 

$121.8 billion at December 31, 2023. The $6.4 billion decrease was primarily a result of the 

losses associated with the 2023 failures and losses on the sale of the DIF investment portfolio, 

offset by increased assessment and interest revenue. The contingent liability for anticipated 

failures increased to $726 million as of December 31, 2023 compared to $31 million as of 

December 31, 2022.

The impact of these three large failures on the DIF’s liquidity was significant due to advancing 

funds to repay receivership liabilities. The DIF’s cash, cash equivalents, and U.S. Treasury 

investment portfolio balances decreased by $101.2 billion during 2023 to $23.8 billion at 

year-end 2023, from $125.0 billion at year-end 2022. Absent significant bank failure activity 

in 2024, we anticipate the DIF’s liquidity to increase substantially with the collection of both 

regular and special assessments, as well as dividend payments from ongoing receivership 

asset liquidation efforts. Interest revenue totaled $2.7 billion for 2023, compared to $1.2 

billion for 2022 – a $1.5 billion increase resulting from rising interest rates. Additionally, the DIF 

MESSAGE FROM THE 

CHIEF FINANCIAL OFFICER
MESSAGE FROM THE CHIEF FINANCIAL OFFICER

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 22 

balance reflects realized losses of $2.3 billion for 2023, and an unrealized gain on U.S. Treasury 

securities of nearly $3.0 billion in 2023, compared to an unrealized loss of $2.8 billion in 2022.

In 2023, FDIC operating expenditures totaled $2.8 billion, an increase of $877 million, or 45.6 

percent, over 2022 expenditures. The year-over-year increase in spending was primarily 

driven by expenditures incurred in connection with the resolution of three large regional 

bank failures in early 2023 and rising compensation for FDIC employees. The FDIC Board of 

Directors approved in May 2023 a mid-year budget increase of $750 million in the Receivership 

Funding component of the annual operating budget to address the anticipated expenses 

associated with those bank failures, increasing the total 2023 FDIC Operating Budget to $3.2 

billion. Actual 2023 expenditures were $359 million, or 11.4 percent, below the adjusted 

budget, in part because expenditures for the three large bank failures were lower-thanprojected. Underspending in 2023 was also driven by vacancies in budgeted positions, lowerthan-anticipated travel costs, and delays in some IT and facilities modernization projects. The 

FDIC Board of Directors recently approved a 2024 FDIC Operating Budget totaling $3.0 billion, 

down $198 million (or 6.3 percent) from the 2023 Budget, largely due to lower projected costs 

in the Receivership Funding budget component, partially offset by higher compensation costs 

and increased staffing in the Ongoing Operations budget component. Actual FDIC staffing 

rose from 5,612 full time equivalents (FTEs) in 2022 to 5,952 in 2023, a 6.1 percent increase. 

Authorized staffing for 2024 is 6,817 FTEs. This is an increase of 189 positions (or 2.9 percent) 

from the number of authorized positions in 2023 and 865 positions from the number of 

employees on board at the end of 2023.

During 2023, the FDIC continued to mature the Enterprise Risk Management (ERM) and Model 

Risk Management programs. The FDIC also made enhancements to the Assurance Statement 

process and implemented an agency-wide supply chain risk management program. The FDIC 

continued to make improvements in our contract invoice processes, including independent 

testing and ensuring compliance with FDIC acquisition policies, which contributed to removing 

the prior years’ significant deficiency finding in internal controls in this area. In 2024, the 

FDIC will continue to mature the fraud risk awareness program and project risk management 

program and implement an agency-wide enterprise change management program. 

I have been honored to serve the FDIC in various capacities to help carry out our essential 

mission for the last 35-plus years. As I conclude my tenure here, I wish to share how much I 

appreciate the dedication of the talented FDIC professionals who plan, execute, and account 

for the agency’s resources. Their commitment to ensuring sound financial management 

provides the foundation for our strong stewardship and ensures that reliable and timely 

financial information is available to our stakeholders.

Sincerely,

Bret D. Edwards
FDIC SENIOR LEADERS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 23 

FDIC SENIOR LEADERS

Seated (left to right): Bret D. Edwards, Kymberly K. Copa, Director Jonathan McKernan, 

Chairman Martin J. Gruenberg, Director Travis Hill, Dan Bendler, and Nikita Pearson. 

Standing 1st Row (left to right): Mark E. Pearce, Doreen R. Eberley, Donna M. Saulnier, 

Sylvia Burns, and M. Anthony Lowe. 2nd Row (left to right): Robert D. Harris, Andy Jiminez, 

Amy C. Thompson, Steve Cooper, John Conneely, and Harrel Pettway. 3rd Row (left to right): 

Maureen E. Sweeney, Zachary Brown, E. Marshall Gentry, and Patrick Mitchell. 
FDIC 90TH ANNIVERSARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 24 

June 16, 2023, marked the 90th year since the signing 

of the Banking Act of 1933. This Act established the 

Federal Deposit Insurance Corporation as the world’s 

first national deposit insurance system. Since the 

creation of the FDIC, depositors have never lost a 

penny of insured deposits.

 President Franklin D. Roosevelt signing the Banking Act of 1933.
I.

MANAGEMENT’S

DISCUSSION AND ANALYSIS
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MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 27 

Overview

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

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

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

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

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

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

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

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

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

highlights these and other accomplishments achieved during the year. 

Action Plan for a Safe, Fair and Inclusive 

Work Environment

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

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

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

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

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

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

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

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

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

outreach strategies, and cultural transformation. 

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

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

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

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

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

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

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

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

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

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

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

progress to our employees and the public. 

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

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 28 

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

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

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

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

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

interpersonal misconduct. 

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

Action Plan as appropriate. 

Deposit Insurance

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

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

affect the adequacy and the viability of the DIF.

Long-Term Comprehensive Fund Management Plan

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

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

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

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

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

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

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

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

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

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

percent ratio for 2024. 

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

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

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

percent and 2.5 percent.

State of the Deposit Insurance Fund

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

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

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

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

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

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

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

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

prior year. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 29 

Special Assessment Pursuant to the Systemic Risk Determination

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

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

uninsured depositors in connection with the systemic risk determinations announced on 

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

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

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

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

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

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

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

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

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

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

special assessments.

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

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

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

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

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

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

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

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

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

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

have terminated.

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

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

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

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

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

shortfall special assessment after both receiverships have been terminated. 

Restoration Plan

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

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

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

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

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

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

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

modifications to assessment rates.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 30 

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

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

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

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

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

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

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

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

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

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

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

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

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

Deposit Insurance System Options

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

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

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

2

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

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

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

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

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

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

runs and can threaten financial stability.

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

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

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

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

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

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

an increased but clearly delineated deposit insurance limit;

 Providing Unlimited Coverage of all deposits; and 

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

for business payment accounts. 

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 31 

FDIC Examinations

2023 2022 2021

Risk Management (Safety and Soundness): 

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

Savings Banks 122 129 129

State Member Banks 0 0 0

Savings Associations 0 0 0

National Banks 0 0 0

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

CRA/Consumer Compliance Examinations:

CRA/Consumer Compliance 675 631 740

Consumer Compliance-only 181 355 358

CRA-only 5 1 2

Subtotal—CRA/Compliance Examinations 861 987 1,100

Specialty Examinations:

Trust Departments 255 305 275

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

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

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

TOTAL 4,861 5,297 5,199

Supervision

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

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

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

protects consumers’ rights, and promotes community investment initiatives.

RISK MANAGEMENT EXAMINATION PROGRAM

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

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

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

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

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

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

examinations.

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

through 2023.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 32 

During 2023, the FDIC conducted 1,247 statutorily required 

risk management examinations, and conducted all required 

follow-up examinations for FDIC-supervised problem 

institutions, within prescribed timeframes. The FDIC 

also conducted 861 statutorily required CRA/consumer 

compliance examinations (675 joint CRA/consumer 

compliance examinations, 181 consumer compliance-only 

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

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

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

requirements, within prescribed timeframes.

Problem Institutions and Enforcement Actions

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

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

the Uniform Financial Institutions Rating System (UFIRS)

4

) for safety and soundness purposes. 

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

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

and a 67 percent decrease in problem institution assets.

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

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

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

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

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

enforcement actions and 77 informal enforcement actions against supervised institutions. 

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

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

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

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

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

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

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

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

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

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

orders to pay and four notices of assessment).

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

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

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

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

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

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

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 33 

VOLUME OF MRBA ISSUED IN 2023 BY CATEGORY

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

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

0

50

100

150

200

250

Board/

Management

Risk Lending AML/CFT

Management

Information

Technology

Sensitivity to

Market Risk

Liquidity Earnings Capital Trust Securities

Portfolio

233

96

85

66 60 59

37 33

8 2

88

EXAMINATION PROCESSES

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

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

deterioration. Examiners make supervisory recommendations, including Matters Requiring 

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

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

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

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

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

Point-in-Time Examinations

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

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

alternating basis with the appropriate state banking department. 

Continuous Examinations

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

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

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

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

financial condition; and frequent communication with institution management. Supervisory 

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

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

ROE that aggregates examination and other supervisory activities performed throughout the 

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 34 

Off-Site Monitoring

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

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

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

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

may be vulnerable to challenging economic conditions or reporting financial performance 

metrics outside of normal operating parameters. 

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

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

movements, to name a few. 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

and funding risks continued throughout 2023.

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

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

included daily communication with bank management teams about liquidity positions and 

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

recommendations or enforcement actions, and ratings changes.

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

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

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

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

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

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

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

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

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

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

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

at these institutions. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 35 

Shared National Credit Program

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

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

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

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

of domestic commercial lending. 

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

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

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

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

and softening economic conditions.

SPECIALTY EXAMINATIONS

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

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

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

composite examination ratings under the UFIRS.

5

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

Securities Dealer Examinations

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

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

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

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

Information Technology and Cybersecurity Examinations

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

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

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

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

and issued four formal IT-related enforcement actions. 

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

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

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

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

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

information technology risk management at each safety and soundness examination.

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

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

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

5 See footnote 2.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 36 

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

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

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

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

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

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

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

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

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

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

Transfer Zero Day Vulnerability, and other vulnerabilities.

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

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

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

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

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

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

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

Anti-Money Laundering /Countering the Financing of Terrorism

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

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

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

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

AML/CFT examinations.

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

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

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

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

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

reporting required by the Corporate Transparency Act6

 and continues to work with the group 

on the AML/CFT program rule.

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

 Due Diligence Programs for Correspondent Accounts for Foreign Financial 

Institutions, 

 Prohibition on Correspondent Accounts for Foreign Shell Banks; Records 

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

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

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 37 

 Reporting Obligations on Foreign Bank Relationships with Iranian-Linked 

Financial Institutions, 

 Summons or Subpoena of Foreign Bank Records; Termination of Correspondent 

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

of Legal Process,

 Due Diligence Programs for Private Banking Accounts, and

 Special Information Sharing Procedures to Deter Money Laundering and Terrorist 

Activity.

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

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

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

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

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

money laundering and terrorist financing risk profile.

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

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

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

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

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

webinar on ransomware trends and mitigation recommendations featuring the Federal 

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

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

information.

CONSUMER COMPLIANCE EXAMINATION PROGRAM

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

with established timeframes, implemented enforcement actions where appropriate, and 

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

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

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

accordance with the time standards prescribed by FDIC policy. 

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

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

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

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

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 38 

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

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

the UFIRS.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

FOCUS and the Banker Engagement Site

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

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

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

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

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

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

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

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

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

documents during or outside of examination activities. 

Property Appraisal and Valuation Equity

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

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

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

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

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

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

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

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

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

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

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

recommendations.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 39 

EXAMINER TRAINING AND DEVELOPMENT 

In 2023, the FDIC continued to emphasize the importance 

of delivering timely and effective examiner training

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

part of developmental activities; however, examiners also 

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

asynchronous (such as computer-based) training.

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

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

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

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

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

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

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

knowledge.

EMERGING TECHNOLOGY

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

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

financial services. Since 2016, these efforts have 

been led by the FDIC’s Emerging Technology 

Steering Committee, which is supported by 

two staff-level working groups. The Steering 

Committee is composed of the Directors 

of RMS, DCP, the Division of Insurance and 

Research (DIR), the Division of Resolutions 

and Receiverships (DRR), and the Division of 

Complex Institution Supervision and Resolution 

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

Financial Officer, Chief Innovation Officer, Chief 

Risk Officer, and Chief Information Officer. 

In addition, in 2023, the FDIC created the 

Emerging Technology Section in RMS to 

provide examination support and lead policy 

development related to emerging technologies

and the Technology Enterprise and Consumer 

Harm Risk and Innovation Section in DCP to 

expand technical knowledge and supervision 

capabilities of emerging technologies as they 

are adopted in financial services. 

Emerging Technology Steering Committee

Throughout 2023, the Steering Committee 

continued work on its established objectives to: 

 Comprehend, assess, and monitor 

the current emerging technology

activities, risks, and trends; 

 Evaluate the projected impact of 

emerging technology on the banking 

system, the deposit insurance 

system, effective regulatory

oversight, economic inclusion, and 

consumer protection; 

 Oversee internal working groups 

monitoring particular aspects of 

emerging technology; 

 Recommend follow-up actions,

as appropriate, and monitor 

implementation; and 

 Help formulate strategies to respond 

to opportunities and challenges 

presented by emerging technology

and to ensure developments align 

with regulatory goals.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 40 

These sections join the Emerging Technology & AML/

Cyber Fraud Policy Group, which was formed within 

the Office of the General Counsel in 2020. The group 

houses a team of attorneys which focuses on legal 

issues facing both the FDIC and its supervised and 

insured banks and savings associations arising from 

emerging forms of technology, including blockchain, 

tokenization of assets and liabilities, open banking, 

and artificial intelligence and machine learning.

The FDIC established FDITECH to help the agency 

adopt innovative and transformative technologies. 

The mission of FDITECH is to work across divisions 

and offices within the FDIC to address critical 

business needs through the use of new automations, 

technology innovations and process improvements. 

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

ledger technology.

RISK MONITORING

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

through its supervision program.

Digital/Crypto-Related Activities Risk

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

on Digital Asset Financial Stability Risks and Regulation,

7

 that concluded that crypto-asset 

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

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

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

regulatory structure. 

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

For example, the FDIC has developed processes to engage in 

robust supervisory discussions with banking organizations 

regarding proposed and existing crypto-asset-related 

activities, and in 2023, provided case-specific supervisory 

feedback to supervised institutions that are engaging in 

or planning to engage in these activities.

8

 Case-specific feedback focuses on assessing the 

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

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

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

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

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

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

FDITECH 

FDITECH has worked within the agency to: 

 Partner with DCP to pilot 

the use of machine learning 

to replace manual methods 

of collecting data during 

compliance examinations 

of FDIC-supervised 

financial institutions. 

 Partner with RMS to 

expand the use of machine 

learning to analyze 

Reports of Examination 

of individual financial 

institutions to identify risks 

across the banking sector. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 41 

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

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

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

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

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

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

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

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

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

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

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

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

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

SUPERVISION POLICY

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

information to financial institutions and examiners.

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

Policies:

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

designation and reflecting items listed for Special Mention in ROEs; 

 Section 3.6 was updated to provide revisions for relevant accounting changes 

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

(ORE); 

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

 Section 16.1 provided updated instructions for reflecting items listed for Special 

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

deposits in the ROE; 

 Section 21.1 was renamed for clarity and the examination planning instructions 

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

incorporate staff feedback; and

 Section 21.2 was added to provide planning instructions for continuous 

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

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

complex, or present a higher risk profile. 

Credit Risk, Liquidity Risk and Interest Rate Risk

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 42 

significant challenges from the effects of inflation, rising 

market interest rates, and geopolitical uncertainty.

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

norms. Meanwhile, allowances for credit losses continued 

to grow, reflecting the potential for credit quality and 

profitability to weaken. In addition, CRE portfolios face 

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

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

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

market interest rates.

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

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

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

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

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

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

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

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

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

to funding if market interest rates continue to rise. 

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

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

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

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

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

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

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

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

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

adequacy, asset quality, and liquidity under these conditions. 

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

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

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

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

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

constructive feedback to help financial institutions navigate this challenging environment.

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

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

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

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

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

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

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 43 

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

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

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

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

to depository institutions.

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

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

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

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

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

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

Climate-Related Financial Risks

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

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

the FDIC’s core mission and responsibilities.

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

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

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

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

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

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

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

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

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

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

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

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

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

financial condition.

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

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

disasters.9

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

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

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

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

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

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

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

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

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

Intergovernmental Panel on Climate Change (Cambridge, United Kingdom: Cambridge University Press).
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 44 

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

to remain resilient despite these rising risks.

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

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

address climate-related financial risk include:

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

the safety and soundness and financial stability considerations associated with 

climate-related financial risks;

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

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

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

international organizations, consistent with the mandate of the FDIC;

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

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

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

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

common approaches and standards, and facilitate communication across FSOC 

members and interested parties;

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

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

financial risks for large financial institutions;

10 and

 Building capabilities, through pursuing and developing internal educational 

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

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

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

collaboration with other supervisors and the industry.

RULEMAKING AND GUIDANCE

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

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

institutions on a number of current issues.

Community Reinvestment Act Rules

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

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

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

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

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

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

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

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

maintain a unified interagency approach. 

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

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

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

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

and flexibility in relation to the NPR. 

FDIC Sign and Advertising Rules and Misrepresentation Rule 

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

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

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

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

regarding misrepresentations of deposit insurance coverage by addressing specific scenarios 

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

institution and whether their funds are protected by deposit insurance. 

Suspicious Activity Reporting Requirements

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

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

requirements to supervised institutions. The existing regulation allows exemptions from 

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

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

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

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

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

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

activity in a different manner. 

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

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

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

timing.

Automated Valuation Models

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

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

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

market issuers in valuing real estate collateral securing mortgage loans. 

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

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

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

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

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

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

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

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

the rule.

Residential Real Estate Valuations

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

issued for comment proposed Interagency Guidance 

on Reconsiderations of Value (ROV) of Residential 

Real Estate Valuations. The proposal highlights the 

risks associated with deficient residential real estate 

valuations, particularly those that can contain errors, 

omissions, or discrimination that affect the value 

conclusion. Additionally, the proposal describes how 

financial institutions may incorporate effective ROV 

processes into established appraisal and evaluation 

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

regulations, including those designed to protect consumers.

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

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

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

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

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

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

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

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

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

Basel III Capital Standards

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

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

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

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

not be impacted by the proposal.

The implementation of these standards for large banking organizations would strengthen

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

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

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

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

securities in their capital ratios. 

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

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

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

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

better reflect their capacity to absorb losses.

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

review comments received.

Standards for Governance and Risk Management for Institutions with Total

Consolidated Assets of $10 Billion or More

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

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

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

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

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

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

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

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

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

management framework, including an independent Risk Committee. 

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

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

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

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

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

covered institution does not realize a loss from the breach. 

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

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

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

closed on February 9, 2024.

Section 19 of the Federal Deposit Insurance Act

In November 2023, the FDIC issued a request for comment 

on an NPR that updates the FDIC’s regulations concerning 

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

from participating in the affairs of an FDIC-insured 

institution if he or she has been convicted of an offense 

involving dishonesty, breach of trust, or money laundering, 

or has entered into a pretrial diversion or similar program in 

connection with a prosecution for such an offense, without 

the prior written consent of the FDIC.

The proposed rule would incorporate changes made by 

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

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

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

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

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

January 16, 2024. 

Areas Affected by Natural Disasters

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

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

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

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

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

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

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

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

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

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

convenient availability of services to those affected by these disasters.

Proposed Merger Transactions

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

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

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

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

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

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

merger process was warranted.

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

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

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

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

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

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

Transactions.

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

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

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

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

the Department of Justice, as appropriate. 

Climate-Related Financial Risk

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

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

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

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

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

safe and sound practices.

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

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

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

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

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

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

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

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

their communities.

Contingency Funding Plans 

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

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

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

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

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

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

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

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

requirements to obtain funding from contingent sources.

Commercial Real Estate Accommodations and Workouts

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

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

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

resource for financial institutions to consider when engaging 

with borrowers experiencing financial difficulties. The 

updated statement finalized a proposed statement issued 

in the third quarter of 2022, updates the October 2009 

Policy Statement on Prudent Commercial Real Estate Loan 

Workouts12 adopted by FFIEC agencies, builds on existing 

supervisory guidance calling for financial institutions to 

work prudently and constructively with creditworthy borrowers during times of financial 

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

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

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

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

accommodations or loan workout activity.

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

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

12 See FFIEC Press Release, October 30, 2009, available at: https://www.ffiec.gov/press/pr103009.htm
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 50 

Third-Party Relationships

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

Relationships: Risk Management designed to help banking organizations manage risks 

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

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

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

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

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

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

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

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

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

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

released in July 2021.

London Inter-Bank Offered Rate (LIBOR) Transition

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

conjunction with the state bank and state credit union 

regulators, jointly issued a statement to remind supervised 

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

30, 2023. The agencies also reiterated their expectations 

that institutions with USD LIBOR exposures should complete 

their transition of remaining LIBOR contracts as soon as 

practicable.

Crypto-Asset Risks

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

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

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

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

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

abusive acts or practices). 

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

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

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

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

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

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

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

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

13 The guidance rescinds and replaces the FDIC’s Guidance for Managing Third-Party Risk issued in FIL-44-2008.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 51 

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

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

permitted by law or regulation. 

Research

CENTER FOR FINANCIAL RESEARCH

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

supports, and conducts innovative research on topics 

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

supervision, and the resolution of failed banks. CFR 

researchers have published papers in leading banking, 

finance, and economics journals, including the American 

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

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

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

universities.

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

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

ongoing support to RMS during on-site examinations.

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

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

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

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

FDIC Academic Challenge, from the State University of New York College at Geneseo.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 52 

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

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

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

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

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

was announced as the winner of the challenge. 

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

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

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

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

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

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

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

timeframe.

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

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

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

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

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

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

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

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

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

promoting career opportunities at the FDIC.

In partnership with the American Economic Association Summer Program and Howard 

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

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

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

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

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

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

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

students and junior FDIC staff.

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

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

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

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

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

published in 2024.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 53 

Speakers at the AEA Summer Program Luncheon.

National and Regional Risk Analysis

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

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

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

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

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

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

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

facing banks.

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

included two articles:

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

and branch growth; and

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

2022 and 2004 to 2006”.

CONSUMER RESEARCH

2023 FDIC National Survey of Unbanked and Underbanked Households

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

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

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

will be released in 2024.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 54 

FDIC Survey of Volunteer Income Tax Assistance Providers

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

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

many cases, these returns result in significant refunds. 

The receipt of these refunds has the potential to present 

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

an account to quickly and securely receive their payment. 

Some, but not all, VITA providers offer clients the 

opportunity to open bank accounts and access to 

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

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

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

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

released in 2024.

Community Banking

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

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

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

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

local communities across the nation. 

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

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

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

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

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

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

operated by community banks.

COMMUNITY BANKING RESEARCH

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

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

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

banking topics. 

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

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

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

shows that quarterly net income at community banks decreased 15 percent on a merger-
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 55 

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

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

of securities.

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

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

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

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

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

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

Advisory Committee on Community Banking

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

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

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

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

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

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

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

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

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

Committee in 2023.

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

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

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

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

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

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

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

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

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

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

meeting that was held the day prior. 

Advisory Committee of State Regulators

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

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

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

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

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

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

Committee discussed the impact of economic conditions on financial institutions they 

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

examination practices. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 56 

De Novo Banks

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

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

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

in developing deposit insurance application proposals, including conducting reviews of 

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

applications at www.fdic.gov.

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

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

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

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

Technical Assistance Program

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

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

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

and webinars, and a video program. 

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Liquidity Risk Management and the Interagency Policy Statement on Prudent Commercial Real 

Estate Loan Accommodations and Workouts.

Deposit Insurance Coverage Webinars

The FDIC held five live seminars on FDIC deposit insurance coverage for bank staff and bank 

officers between May 2023 and October 2023, via Microsoft (MS) Teams. Each seminar lasted 

approximately 90 minutes and included a Question and Answer session. Three sessions titled 

Comprehensive Deposit Insurance Seminar for Bankers offered a broad overview of FDIC deposit 

insurance rules. Two sessions titled New Rules for Revocable and Irrevocable Trust Accounts 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 57 

provided an in-depth discussion of the newly issued rules for trust accounts, effective April 

1, 2024. The sessions provided bank employees with a broad understanding of FDIC deposit 

insurance coverage rules.

Through the Technical Assistance Video Program, the FDIC provides a series of educational 

videos designed to provide useful information to bank directors, officers, and employees on 

various risk management and consumer protection-related matters. The videos help FDICsupervised institutions understand various risk management and consumer protectionrelated matters. In 2023, the FDIC released one video for bank directors and one video for bank 

officers and staff, each covering cybersecurity. 

Activities Related to Large and Complex 

Financial Institutions, Including Systemically

Important Financial Institutions

The FDIC is committed to addressing the unique challenges associated with supervising, 

insuring the deposits of, and resolving large and complex financial institutions (LCFIs). The 

agency’s ability to analyze and respond to risks posed by these institutions is critical, as they 

comprise a significant share of banking industry assets and deposits.

The FDIC’s Division of Complex Institution Supervision and Resolution (CISR) was established 

in 2019 to centralize and integrate the FDIC’s operations to leverage both supervisory and 

resolution expertise related to LCFIs, including systemically important financial institutions 

(SIFIs).

The mission of CISR is to protect and maintain stability in the U.S. financial system by avoiding 

and, if necessary, managing the failure of LCFIs. CISR 

performs ongoing risk monitoring of LCFIs in its portfolio 

that are domestic global systemically important banks 

(G-SIBs), large foreign banking organizations (FBOs), and 

large domestic banking groups, and provides backup 

supervision of the firms’ related IDIs, in addition to 

monitoring and assessing systemic and emerging risks 

across the CISR portfolio. CISR evaluates firms’ required 

resolution plans and assesses the resolvability of 

individual LCFIs. The division formulates and, in the event 

of failure, leads the execution of strategies and plans for resolving LCFIs under either the FDI 

Act or the Dodd-Frank Act (Title II). CISR also develops and monitors policy relevant to CISR’s 

mission and supports engagement in various external forums such as FSOC and the Financial 

Stability Board. 

CISR leads and conducts its responsibilities for the FDIC in close collaboration with RMS, DRR, 

Legal, and other FDIC Offices and Divisions, so as to maintain and enhance integration of the 

agency’s LCFI crisis management planning, preparedness, and response activities.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 58 

SUPERVISION AND RISK ASSESSMENT

Monitoring and Measuring Systemic Risks

The FDIC monitors risks related to G-SIBs as well as other large domestic banks and FBOs at 

both the firm-level and industry-wide to inform supervisory planning and response, policy 

and guidance considerations, and resolution planning 

efforts. As part of this monitoring, the FDIC analyzes each 

company’s risk profile, governance and risk management 

strategies, structure and interdependencies, business

operations and activities, management information

system capabilities, and recovery and resolution 

capabilities. Evaluating capital and liquidity adequacy 

and resiliency under stressed conditions is also a key part 

of monitoring. Further, in response to market and deposit volatility experienced during the 

banking industry stress in March 2023, the FDIC performed heightened risk monitoring. 

The FDIC works closely with the other federal regulatory agencies as well as foreign regulators 

to analyze institution-specific and industry-wide conditions and trends, emerging risks 

and outliers, risk management, and the potential financial stability risk posed by G-SIBs, 

other large domestic banks and FBOs, and nonbank financial companies. To support 

risk monitoring, the FDIC has developed systems and reports that make extensive use of 

structured and unstructured data. Monitoring reports cover a variety of aspects that include 

risk components, business lines and activity, market trends, and product analysis. 

In addition, the FDIC continues to expand its monitoring systems, including the CISR Risk 

Monitor (CRM), the SIFI Risk Report (SRR), and the CAMELS Verification document. The CRM 

is an off-site monitoring system that combines bank holding company quantitative financial 

information with qualitative information to support CISR’s identification and assessment 

of firm and broader market stress. The SRR identifies key vulnerabilities of systemically 

important firms, and the CAMELS Verification document includes an independent assessment 

of the appropriateness of supervisory CAMELS ratings for the IDIs held by these firms. 

Information from these and other FDIC-prepared reports is used to prioritize activities relating 

to oversight of LCFIs and to coordinate supervisory and resolution-related activities with the 

other banking agencies.

Back-Up Supervision Activities for IDIs of SIFIs

Risk monitoring is enhanced by the FDIC’s backup supervision activities. In this role, as 

outlined in Sections 8 and 10 of the FDI Act, the FDIC has expanded resources and has 

developed and implemented policies and procedures to guide backup supervisory activities. 

These activities include performing analyses of industry conditions and trends, supporting 

insurance pricing, participating in supervisory activities with other regulatory agencies, and 

exercising independent examination and enforcement authorities when necessary.

At institutions where the FDIC is not the primary federal regulator, FDIC staff work closely 

with other regulatory authorities to identify emerging risks and assess the overall risk profile 

of large and complex institutions. The FDIC has assigned dedicated staff to IDIs that are LCFIs 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 59 

to enhance risk-identification capabilities and facilitate the communication of supervisory 

information.

FDIC’s Backup Supervision Activities

During 2023, FDIC staff completed 40 targeted examinations and 54 reviews as part of 12 

horizontal examination programs with the FRB or OCC involving G-SIBs, FBOs, and large 

regional banks.

Targeted Examinations Horizontal Examinations

The targeted examination activities included,

but were not limited to, the evaluation of 

interest rate risk, commercial real estate, climate 

risk, enterprise risk governance, model risk 

management, non-bank financial institutions

(NBFI), third-party risk management, market risk 

and trading activities.

The horizontal examinations included the 

Comprehensive Capital Analysis and Review

(CCAR), Horizontal Capital Review (HCR), 

Shared National Credits (SNC), CRE Downturn 

Preparedness, Intraday Liquidity Risk 

Management, FRB’s Recovery Planning 

(Phase I), OCC’s Recovery Planning, Fundamental 

Review of the Trading Book (FRTB), Interagency 

Coordinated Cybersecurity Review (iCCR), 

Interest Rate Risk Management, LFBO Liquidity 

Risk Management, and FRB’s Climate

Scenario Exercise.

RESOLUTION PLANNING

Title I Resolution Plans

Certain large banking organizations, as well as any nonbank financial companies designated 

by FSOC for supervision by the FRB, are periodically required to submit resolution plans to 

the FDIC and FRB. Each resolution plan, commonly known as a “living will,” must describe the 

company’s strategy for a rapid and orderly resolution under the U.S. Bankruptcy Code in the 

event of material financial distress or failure of the company. 

The eight most systemically important domestic banking organizations submitted full 

resolution plans on or before July 1, 2023, and these plan submissions are being evaluated 

jointly with the FRB. In August 2023, the FDIC issued jointly with the FRB proposed guidance 

to enhance the Title I resolution plans prepared by the Category II and Category III Triennial 

Full Filers, which includes the largest regional banks with assets between $250 and $700 

billion, as well as several foreign-based institutions. This proposed guidance draws upon 

guidance previously issued to the global systemically important banking organizations, 

reflects observations drawn from the most recent resolution plan submissions, and addresses 

certain capabilities that are essential for firms to have to effect an orderly resolution under the 

Bankruptcy Code, such as those necessary to project the capital and liquidity needed to carry 

out their plan; operational capabilities related to payment, clearing, and settlement activities; 

collateral; management information systems; and shared and outsourced services.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 60 

IDI Resolution Planning

Section 360.10 of the FDIC’s resolution and receivership rules requires an IDI with total assets 

of $50 billion or more to periodically submit to the FDIC a plan for its resolution in the event 

of its failure (the “IDI rule”). The IDI rule requires covered IDIs to submit a resolution plan that 

would allow the FDIC, as receiver, to resolve the institution under Sections 11 and 13 of the 

FDI Act in an orderly manner that enables prompt access to insured deposits, maximizes 

the return from the sale or disposition of the failed IDI’s assets, and minimizes losses realized 

by creditors.

In June 2021, the FDIC outlined a modified approach to implementing the IDI rule in a manner 

which focused on certain requirements for IDIs with $100 billion or more in total assets. 

Resolution plans for 21 IDIs were submitted on or before December 1, 2022. Two of these 

IDIs failed and were resolved by the FDIC during the course of the plan review. A third IDI was 

acquired by another filer. The remaining plans have been reviewed and feedback has been 

provided to the institutions. New resolution plans for an additional 12 IDIs were submitted 

in 2023 and are under review. For IDIs with less than $100 billion in total assets, the April 2019 

moratorium on submission of IDI resolution plans remains in effect. However, on August 29, 

2023, the FDIC proposed amending the section 360.10 resolution planning rule which would 

modify the scope and requirements for these submissions as described further below under 

“Resolution Policy”.

The FDIC also undertakes institution-specific resolution planning under the FDI Act for IDIs 

that are LCFIs, drawing on both IDI plans submitted by the firms and follow-on engagement 

with the firms. The development of a large regional bank resolution framework and process 

builds on lessons learned from historical bank resolutions and practices developed in 

connection with Title II resolution readiness planning for LCFIs. The FDIC is incorporating 

lessons learned from the three large bank failures that occurred in the spring of 2023 into its 

development of these plans.

Title II Orderly Liquidation Authority 

Under the Dodd-Frank Act, failed or failing financial companies are expected to file for 

reorganization or liquidation under the U.S. Bankruptcy Code, similar to any failed or failing 

nonfinancial company. If resolution under the Bankruptcy Code would result in serious 

adverse effects to U.S. financial stability, Title II of the Dodd-Frank Act provides a backup 

authority for resolving a company for which the bankruptcy process is not viable. There are 

strict parameters on the use of the Title II Orderly Liquidation Authority, however, and it can 

only be invoked under a statutorily prescribed recommendation and determination process, 

coupled with an expedited judicial review process.

The FDIC has undertaken institution-specific strategic planning to carry out its orderly 

liquidation authorities with respect to the largest G-SIBs operating in the United States. The 

strategic plans and resolution optionality being developed for these firms are informed by 

the Title I plan submissions. Further, the FDIC updates its systemic resolution framework to 

incorporate enhanced firm capabilities established through the Title I planning process and 

other domestic and foreign resolution planning and policy developments. The FDIC continues 

to build out process documents to facilitate the implementation of the framework in a Title 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 61 

II resolution. In addition, work continues in the development of resolution strategies for 

financial market utilities that have been designated as systemically important by the FSOC, 

particularly the five that are central counterparties (CCPs).

As noted in response to the Office of Inspector General’s Orderly Liquidation Authority 

Evaluation Report (No. EVAL-23-004), the FDIC is committed to continuing to improve 

and mature its framework for the orderly resolution of a SIFI, including strengthening 

governance practices, improving internal process documentation, further specifying roles 

and responsibilities, enhancing training, and allocating additional resources. This work will 

continue to be part of the FDIC’s ongoing strategic initiatives over the next several years.

Resolution Policy

The failures of Silicon Valley Bank, Signature Bank, and First Republic Bank in the first half 

of 2023 demonstrated the risks that banks – even those that are not G-SIBs – can pose to 

financial stability. These regional banking failures informed the development of several 

resolution policy initiatives already underway at the time of their demise. 

In August 2023, the federal banking agencies proposed a set of rulemakings and guidance to 

enhance resolution planning and preparedness, particularly for large IDIs. This included three 

complementary proposals.

Long-Term Debt Requirements

The FDIC, FRB, and OCC jointly issued an NPR to require IDIs that are not consolidated 

subsidiaries of U.S. G-SIBs and that (i) have total consolidated assets of $100 billion or 

more or (ii) are affiliated with IDIs that have at least $100 billion in consolidated assets to 

maintain outstanding a minimum amount of eligible long-term debt (LTD) that can be used 

to absorb losses in the event of their failure. In addition to the IDI-level requirement, the 

FRB is proposing to require the covered entities of such IDIs to also maintain outstanding a 

prescribed amount of LTD and to comply with specified clean holding company requirements 

akin to those required of G-SIBs.

In addition to increasing the options for the resolution of large banks, the proposed rule, if 

enacted, would reduce the risk of loss to depositors and the Deposit Insurance Fund in the 

event of a large regional bank failure. Many large banks already maintain significant amounts 

of long-term debt, though most banks would need to issue additional new long-term debt to 

meet the proposed requirement.

The proposed LTD requirement would take full effect three years after the date on which 

a covered IDI first becomes subject to the proposed rule. The full amount of LTD that 

covered IDIs would be required to hold, however, would be phased in over the three-year 

implementation period to reduce the potential for market disruption.

Resolution Plans and Informational Filings

The FDIC’s proposed IDI Planning Rule would strengthen the existing IDI resolution planning 

requirements under 12 CFR § 360.10. The proposal would require a resolution submission from 

covered IDIs every two years with more limited supplements filed in the other years.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 62 

IDIs with total assets of at least $100 billion would be required to submit comprehensive 

resolution plans to support the FDIC’s efficient and effective resolution of a large IDI under the 

FDI Act. These resolution plans would enhance current IDI resolution planning requirements 

by incorporating useful elements of existing guidance and important lessons learned from 

past plan reviews and from past large IDI resolutions, including those that occurred in the 

spring of 2023. 

Under this proposal, IDIs with total assets of at least $50 billion but less than $100 billion 

would submit limited informational filings to provide the FDIC with critical information to 

assist in their potential resolution. These IDIs would not be required to develop a resolution 

strategy as part of their submissions.

Under the proposed submission schedule, IDIs would file a complete resolution plan on a 

date that will be specified by the FDIC every other year, beginning at least 270 days from the 

effective date of the final rule. 

Guidance for Title I Resolution Plan Submissions

The FDIC and FRB have proposed new guidance to help certain large banks to further develop 

and enhance their resolution plans required under Title I of the Dodd-Frank Act.

The guidance is organized around key areas of potential vulnerability, such as capital, liquidity, 

and operational capabilities that could be needed in resolution. Distinct from the guidance to 

the largest and most complex companies, the proposal would provide agency expectations 

for both single point of entry and multiple point of entry strategy needs, which are different 

strategies companies may adopt for their rapid and orderly resolution. It also would propose 

that FBOs develop their U.S. resolution strategies to be complementary to their global 

resolution plans.

The comment period for these resolution policy proposals closed on November 30, 2023. The 

FDIC, along with the other federal regulatory agencies are reviewing the comments submitted 

and would aim to finalize the rules and guidance in 2024.

Recordkeeping Requirements

The FDIC has implemented several recordkeeping regulations to support the resolvability 

of certain large IDIs and nonbank financial companies by requiring institutions subject to 

those regulations to maintain recordkeeping and reporting capabilities to enable the timely 

determination of deposit insurance coverage and the evaluation of Qualified Financial 

Contracts (QFCs). The FDIC maintains programs to test such institutions’ compliance with 

those regulations.

Timely Deposit Insurance Determination

The FDIC’s Recordkeeping for Timely Deposit Insurance Determination regulation (12 CFR 

Part 370) became effective on October 1, 2019. Under this rule, an IDI that has two million 

or more deposit accounts for two consecutive quarters must implement the IT system and 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 63 

recordkeeping capabilities needed to calculate the amount of deposit insurance coverage 

available for each deposit account in the event of its failure. Doing so will improve the FDIC’s 

ability to fulfill its statutory mandates to pay deposit insurance as soon as possible after an 

institution’s failure and to resolve an institution at the least cost to the DIF. The FDIC conducts 

periodic compliance tests to assess the adherence of covered institutions to the rule.

The FDIC’s Large-Bank Deposit Insurance Determination Modernization regulation (12 CFR 

360.9) became effective on August 18, 2008. Under this rule, an IDI that has at least $2 billion 

in deposits and at least either (i) 250,000 deposit accounts or (ii) $20 billion in total assets, 

regardless of the number of deposit accounts, for two consecutive quarters, must have an 

automated process for implementing a provisional hold on all deposit accounts, foreign 

deposit accounts, and sweep investment accounts in the event of its failure. The rule permits 

the FDIC to fulfill its legal mandates regarding the resolution of failed IDIs to provide liquidity 

to depositors promptly, enhance market discipline, and reduce the FDIC’s costs by preserving 

the franchise value of a failed institution. The FDIC conducts periodic compliance tests to 

assess the adherence of covered institutions to the rule.

Qualified Financial Contracts

There are two regulations that require QFC recordkeeping. The first is the regulation 

promulgated by the Secretary of the Treasury for Qualified Financial Contracts Recordkeeping 

related to the FDIC Orderly Liquidation Authority (31 CFR Part 148), which requires certain 

nonbank financial companies to provide detailed QFC reporting to the FDIC on an ongoing 

basis. The second is the FDIC’s Recordkeeping Requirements for Qualified Financial Contracts 

regulation (12 CFR Part 371), which requires IDIs meeting the definition of “troubled condition” 

to provide detailed QFC reporting to the FDIC.

Both rules require institutions within their scope to prepare in advance and provide the 

information about their QFC portfolios, which may be of a significant size and complexity, in 

order to facilitate well-informed decisions about how to manage the QFCs if the FDIC were 

ever appointed receiver for any of those institutions, whether under the FDI Act or under the 

Orderly Liquidation Authority of the Dodd-Frank Act, as applicable. The FDIC requires periodic 

submissions from such institutions to assess their adherence to these rules.

Cross-Border Cooperation

Cross-border cooperation and advance planning are critical components of resolution 

and crisis management planning due to the international nature of services and overseas 

operations of many LCFIs. In 2023, the FDIC continued its robust bilateral and multilateral 

engagement with foreign authorities to deepen mutual understanding of the complex legal 

and operational issues related to cross-border resolution and preparedness. This work is 

underpinned by an understanding that transparency and confidence in resolution planning 

will serve as a stabilizing force during times of stress.

In 2023, the FDIC led significant principal- and staff-level engagements with foreign 

jurisdictions to discuss cross-border issues and potential impediments that could affect 

resolvability as part of ongoing efforts to continue to deepen coordination on cross-border 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 64 

resolution. For example, the FDIC engaged in ongoing trilateral work on cooperation in the 

cross-border resolution of G-SIBs with U.S., UK, and European Union (EU) financial regulatory 

authorities. Contributors to this work include senior staff and senior officials of participating 

financial regulatory agencies from these jurisdictions. The FDIC maintains a close working 

relationship on cross-border resolution planning topics with EU and UK authorities, among 

other jurisdictions, including through joint meetings and technical experts calls.

Financial Stability Board Resolution Steering Group

The FDIC continued to enhance cooperation on cross-border resolution through its 

participation in the Financial Stability Board (FSB) Resolution Steering Group (ReSG) and 

its subgroups on banks, insurance, and financial market infrastructures. This year, the FDIC 

continued its active engagement in FSB work, in particular through the FDIC’s leadership as 

ReSG Chair, as co-chair of its Cross-Border Crisis Management Committee for Financial Market 

Infrastructures, and as a member of ReSG and each of its subgroups, thereby contributing to 

work on standards and implementation.

Cross-Border Crisis Management Groups

With regard to the FDIC’s institution-specific engagement, the FDIC co-chairs cross-border 

Crisis Management Groups (CMGs) of supervisors and resolution authorities for U.S. G-SIBs 

and CCPs, and participates as a host authority in the work of CMGs for several foreign G-SIBs 

and CCPs. Work through these CMGs allows the FDIC to improve resolution preparedness by 

strengthening our working relationships with key authorities, providing a forum to address 

institution-specific resolution planning considerations, and supporting information-sharing 

arrangements. The FDIC, in collaboration with the FRB, held meetings for all eight U.S. G-SIB 

CMGs in 2023. In collaboration with the Commodity Futures Trading Commission (CFTC) and 

the Securities and Exchange Commission (SEC), the FDIC held meetings for three U.S. CCP 

CMGs in 2023. Due to continued international travel challenges, these meetings were held 

using a mix of hybrid and fully virtual formats.

Joint U.S.–EU Financial Regulatory Forum

FDIC staff participated in three Joint U.S.-EU Financial Regulatory Forum meetings held in 

2023, as a member of the U.S. delegation led by Treasury staff, along with FRB, CFTC, SEC, 

and OCC staff. Staff from the European Commission, European Banking Authority, European 

Securities and Markets Authority, European Insurance and Occupational Pensions Authority, 

European Central Bank, Single Supervisory Mechanism, and Single Resolution Board 

represented the EU. The forum meetings underscored EU and U.S. cooperation and focused 

on a number of themes, such as market developments; current assessments of financial 

stability risks; multilateral and bilateral engagement in banking, regulatory, and supervisory 

cooperation in capital markets; operational resilience and digital finance; and AML/CFT, 

among other topics. Authorities also shared experiences related to the spring 2023 

bank failures.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 65 

U.S.–UK Financial Regulatory Working Group

The FDIC also maintains a close working relationship on cross-border resolution planning 

topics with UK authorities, including through dialogue as a participating agency in the U.S.-

UK Financial Regulatory Working Group (FRWG), which the U.S. Treasury and UK Treasury 

established in 2018 to serve as a forum for bilateral regulatory cooperation between the U.S. 

and the UK. The FDIC participates along with the FRB, OCC, SEC, and CFTC; participating UK 

regulators include the Bank of England and the Financial Conduct Authority. In 2023, the 

FRWG meeting discussion focused on a number of themes, such as international and bilateral 

cooperation, sustainable finance, non-bank financial intermediation, operational resilience, 

cross-border regimes, and resolution-related updates, among other topics. Authorities also 

shared experiences from the spring 2023 bank failures.

Principals Tabletop Exercise Meeting 

In October 2023, senior officials from the FDIC, CFTC, SEC, FRB, and the Bank of England 

convened a hybrid exercise to identify, consider, and discuss key information that would need 

to be shared between authorities, as well as strategic direction and decisions that respective 

authorities would need to make, in a potential scenario where the resolution of a systemically 

important CCP may become necessary. This exercise was conducted as part of a regular series 

of senior-level meetings held since 2017 to share views on CCP resolutions and review the 

progress of an ongoing program of joint work among the agencies.

Senior Staff Exercise 

In June 2023, senior officials from the FDIC, U.S. Treasury, FRB, Federal Reserve Bank of 

New York, OCC, CFPB, SEC, CFTC, the Bank of England, UK Treasury, European Central Bank, 

European Commission, and Single Resolution Board convened a meeting in the continuation 

of a series of exercises and exchanges to enhance the understanding of each jurisdiction’s 

resolution regime for G-SIBs and to strengthen coordination on cross-border resolutions. 

This exercise built on six prior cross-border principal level events going back to 2014, with 

European Banking Union authorities joining in 2016, and addressed lessons learned from 

recent bank failures in each jurisdiction.

Systemic Resolution Advisory Committee

The FDIC created the Systemic Resolution Advisory Committee (SRAC) in 2011 to provide 

advice and recommendations on a broad range of issues relevant to the failure and resolution 

of systemically important financial companies pursuant to the Dodd-Frank Act.

Members of the SRAC have a wide range of experience, including managing complex firms, 

serving as bankruptcy judges, and working in the legal system, accounting, and academia. 

The FDIC held an SRAC meeting in December 2023 that focused on the March bank failures 

and lessons learned, large bank strategy and resolution options, and large bank policy 

considerations.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 66 

Depositor and Consumer Protection

A major component of the FDIC’s mission is to ensure that financial institutions treat 

consumers and depositors fairly, and operate in compliance with federal consumer protection, 

anti-discrimination, and community reinvestment laws. The FDIC also promotes economic 

inclusion to build and strengthen positive connections between insured financial institutions 

and consumers, depositors, small businesses, and communities.

Public Awareness of Deposit Insurance Coverage

Throughout 2023, the FDIC continued its efforts to educate bankers and consumers about 

FDIC insurance coverage.

In October 2023, the FDIC launched a national deposit insurance awareness campaign to 

raise awareness about how it can protect consumers’ money in the event of a bank failure. 

“Know Your Risk. Protect Your Money,” is a consumerfocused campaign that aims to reach those who may 

have lower confidence in the U.S. banking system or who 

are unbanked, as well as those who use mobile payment 

systems, alternative banking services, and financial 

products that may appear to be FDIC-insured but are not.

The campaign features a piggy bank, which is commonly 

associated with money and personal savings, placed in 

potentially risky situations. The campaign consists of 

digital display ads, including web banners, as well as search 

engine marketing and sponsored social media that connect 

consumers to deposit insurance information and resources on the FDIC’s website in English 

and Spanish. The digital campaign ran through November 2023 and resumed in January 2024 

with the start of traditional tax filing season and when many consumers receive 

refund payments.

DEPOSITOR AND CONSUMER PROTECTION RULEMAKING AND GUIDANCE

In 2023, the FDIC made a number of updates to compliance examination principles and 

procedures, including the following:

Small-Dollar Lending

In April 2023, the FDIC published Small-Dollar Lending Examination Procedures, which provide 

a framework for examiners when reviewing small-dollar loan programs. The procedures 

should support examiners in their reviews of small-dollar lending programs that are significant 

in volume or concentration levels. 
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 67 

Fair Debt Collection Practices Act 

In September 2023, updates were made to this section of the FDIC Compliance Examination 

Manual to reflect the 2020 and 2021 amendments to Regulation F by the CFPB and 

the corresponding interagency examination procedures, including debt collection 

communications.

Fees Arising from Re-Presented Items

In June 2023, the FDIC issued updated guidance to clarify its current supervisory approach 

relating to consumer compliance risks associated with assessing multiple non-sufficient funds 

(NSF) fees arising from the re-presentment of the same unpaid transaction. The updated 

guidance explains that the FDIC will not request that an institution conduct a lookback review 

absent a likelihood of substantial consumer harm.

Overdraft Fees

In April 2023, the FDIC issued guidance to ensure that supervised institutions were aware of 

the consumer compliance risks associated with assessing overdraft fees on a transaction that 

was authorized against a positive balance but settled against a negative balance (APSN). The 

guidance expands on an FDIC 2019 Supervisory Highlights article titled “Overdraft Programs: 

Debit Card Holds and Transaction Processing” by discussing the FDIC’s concerns with both 

the available and ledger balance methods used by institutions when assessing overdraft fees. 

FDIC-supervised institutions should be aware of heightened risks of violations of section 

1036(a)(1)(B) of the Dodd-Frank Act and section 5 of the Federal Trade Commission Act 

when assessing overdraft-related fees on APSN transactions. The guidance also encourages 

institutions to review their overdraft practices to ensure compliance, including overdraft 

programs administered by a third party. 

HMDA’s Closed-End Mortgage Loan Volume Reporting Threshold 

In February 2023, the FDIC issued FIL-06-2023, FDIC Supervisory Approach Regarding Changes 

to HMDA’s Closed-End Mortgage Loan Volume Reporting Threshold, to inform supervised 

institutions of recent changes regarding the Home Mortgage Disclosure Act (HMDA) reporting 

threshold for closed-end mortgage loans and the FDIC’s supervisory approach for enforcing 

related requirements. For FDIC-supervised institutions that meet Regulation C’s coverage 

requirements, the threshold for reporting data on closed-end mortgage loans is now 25 

loans in each of the two preceding calendar years. In addition, for closed-end mortgage data 

collected in the years 2022, 2021, or 2020, the FDIC does not intend to initiate enforcement 

actions or cite HMDA violations for certain failures to report such loan data.

Consumer Compliance Supervisory Highlights

The FDIC issued the Consumer Compliance Supervisory Highlights in March 2023. The purpose 

of this publication is to enhance transparency regarding consumer compliance supervisory 

activities. The publication includes a high-level overview of consumer compliance issues 

identified by the FDIC during the prior year’s supervision of state nonmember banks. 

The Spring 2023 issue includes: a summary of the overall results of the FDIC’s consumer 

compliance examinations of supervised institutions in 2022; a description of the most 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 68 

frequently cited violations and other consumer 

compliance examination observations; information 

on examination observations and regulatory 

developments; a summary of consumer compliance 

resources and information available to financial 

institutions; and an overview of trends in consumer 

complaints that were processed by the FDIC in 2022.

PROMOTING ECONOMIC INCLUSION

The FDIC is committed to expanding economic inclusion in the financial mainstream 

by ensuring that all Americans have access to affordable and sustainable products and 

services from IDIs. The agency’s economic inclusion initiatives are integral to our mission 

of maintaining stability and public confidence in the nation’s financial system. The FDIC 

promotes economic inclusion and community development through collaborations with 

financial institutions and other stakeholders committed to strategic initiatives that positively 

impact LMI communities.

The FDIC developed the first multi-year Economic Inclusion Strategic Plan for the FDIC in 

2014. Since then, the number of unbanked households has reached historic lows, and 

both consumers’ needs and the market for financial services have evolved. In 2023, the 

FDIC updated its Plan to support progress toward a state in which all U.S. households can 

establish, sustain, and benefit from banking relationships to create and grow a strong financial 

foundation. In addition, the updated plan incorporates the findings and recommendations 

of the Office of the Inspector General’s evaluation of the FDIC’s efforts to increase consumer 

participation in the insured banking system. The updated Plan includes a comprehensive 

list of key performance indicators based on the community outcomes the FDIC would like 

to advance. The updated Plan and outcomes measurement framework will be implemented 

in 2024.

Advisory Committee on Economic Inclusion

The Advisory Committee on Economic Inclusion (ComE-IN) provides the FDIC with advice and 

recommendations on important initiatives focused on expanding access to banking services 

for underserved populations. This includes reviewing basic retail financial services (e.g., lowcost, safe transaction accounts; affordable small-dollar loans; and savings accounts). ComEIN members also provide perspectives regarding demand-side factors such as consumer 

perceptions of financial institutions and a broad range of consumers’ financial services needs. 

In 2023, the ComE-IN met and discussed the following topics:

 Opportunities to increase account access through collaborations with federal and 

state programs that distribute government financial assistance; 

 Special purpose credit programs;

 The Economic Inclusion Strategic Plan; 

 Community Reinvestment Act (CRA) modernization efforts; and

 Small-dollar lending.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 69 

Leveraging “Bankable Moments” 

During the COVID-19 global pandemic, the FDIC increased and expanded its messaging about 

the importance of having a bank account to encourage more Americans, particularly those 

in LMI communities, to access government relief payments via direct deposit in a secure 

and timely manner. These efforts contributed to an uptick in bank account ownership, as 

reported in the 2021 FDIC National Survey of Unbanked and Underbanked Households. Among 

the survey’s key insights was that unbanked households can be reached by taking advantage 

of such “bankable moments” (i.e., when they are receiving government payments as part of 

existing federal programs) if they are aware of, and able to locate and open, bank accounts 

that can meet their needs.

In light of this success, in 2023, the FDIC focused on additional opportunities to connect 

consumers to safe and affordable bank accounts for other bankable moments. For example:

 The FDIC partnered with Treasury to include #GetBanked inserts with 6.2 million 

mailed checks to individuals receiving government payments from July through 

October 2023. The inserts indicated the importance of opening a bank account 

and encouraged recipients to visit the FDIC’s #GetBanked webpage to find an 

account and learn more about the benefits of having one. As a result, visits to the 

#GetBanked webpage during this time (August) increased more than 44 percent 

from prior months.

 The FDIC promoted affordable accounts during tax-filing season through 

collaborations with affordable tax preparation services, such as the IRS’s VITA 

program. During this period, the FDIC facilitated national and local events, which 

contributed to at least 35 VITA organizations collaborating with 26 local banks to 

offer affordable accounts.

In addition to these national efforts, the FDIC was featured in the National Association of State 

Treasurers’ digital newsletter, which reaches more than 11,000 subscribers principally from 

state treasurers and state government fiscal officers, to encourage state government agencies 

to help more households access bank accounts. 

COMMUNITY AND ECONOMIC DEVELOPMENT

Alliances for Economic Inclusion

FDIC-led Alliances for Economic Inclusion (AEI) are coalitions of local financial institutions and 

consumer, faith-based, community, and government organizations that support economic 

opportunity, particularly for LMI households and communities and small businesses. The FDIC 

currently manages 12 AEI coalitions, which support working groups of bankers and community 

leaders responding to the financial capability and services needs in their communities. 

In 2023, the Los Angeles AEI coordinated efforts in which 17 banks provided 204 volunteers 

that supported 17 VITA sites, which prepared over 10,000 tax returns, resulting in more than 

$10 million in tax refunds. Many of these VITA sites promoted bank account access and savings. 

One organization’s VITA site, for example, helped over 300 individuals locate and open bank 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 70 

accounts. The Los Angeles AEI was also recognized by America Saves with a Community 

Impact Award because of their successful efforts during America Saves Week 2023, during 

which nearly 500 people made savings pledges totaling nearly $1 million; the median pledge 

was $600. 

In addition, several Milwaukee AEI members launched a pilot program entitled the “Financial 

Health Counselor Network” for leaders from organizations that primarily serve Milwaukee, 

Wisconsin residents who are African American, Hispanic, or Asian and who are unbanked. The 

network mission is to build high-quality financial coaching to enhance social service networks 

serving Milwaukee.

Outreach Highlights

As of December 31, 2023, the FDIC hosted approximately 190 events, providing opportunities 

for financial institutions to collaborate with partners on approaches to increase consumer 

access to a broad range of financial products and services including: bank accounts and 

credit services, affordable mortgages, financial products and services for small businesses; 

as well as efforts to help consumers build savings and improve credit histories. These 

events helped organizations identify and develop collaborations with IDIs that may receive 

favorable consideration under the CRA. For example, Community Affairs events facilitated 

collaborations between banks and community-based organizations that contributed to more 

than $12 million of bank investments in community partners. 

More specifically, throughout the year, the FDIC also coordinated activities to support efforts 

to increase consumer account access to affordable and sustainable bank accounts in LMI 

communities and to encourage more banks to offer these accounts. The FDIC conducted 26 

events in collaboration with members of AEIs, Bank On coalitions, bank trade associations, 

and other community-based organizations across the country. For example, the FDIC hosted a 

webinar to increase awareness of the 2021 FDIC National Survey of Unbanked and Underbanked 

Households, the #GetBanked initiative, and free income tax resources available to LMI 

individuals and small businesses in the Kansas City area through community development 

partnerships. As a direct result of this event, two banks partnered with a local Bank On 

coalition to provide volunteers at VITA sites, two banks provided funding to the Missouri 

University Extension for tax time initiatives, and one bank opened a VITA site at their branch 

and at a local community-based organization.

The FDIC encouraged access to sustainable consumer credit through nine events and provided 

technical assistance to banks and their partners. These activities highlighted credit building/

rebuilding strategies for LMI and minority borrowers, including persons with disabilities, and 

strategies designed to expand access to small-dollar loans. In one instance, the FDIC helped a 

community organization in northwest Indiana develop strategies to approach banks to invest 

in an employer-based small-dollar loan model. As a result, three financial institutions made 

a CRA investment of $40,000 into this loan pool. In addition, nine events focused on Special 

Purpose Credit Programs (SPCPs) recently created by lenders to meet the credit needs of 

economically disadvantaged classes of persons. At one CRA banker interagency roundtable 

in California, presenters discussed SPCP models and sparked interest from at least 15 local 

banks interested in offering SPCPs.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 71 

The FDIC continued to engage with banks, federal agencies, housing counseling agencies, 

and national and regional housing coalitions to expand homeownership programs to 

LMI borrowers in an effort to support a foundation for wealth building. The FDIC held 

13 roundtables and forums that resulted in increased engagement by banks to support 

affordable housing programs, including grants. For example, the FDIC and the Federal Reserve 

Bank of San Francisco co-hosted a community development forum in Hawaii that resulted 

in one bank making an investment of over $4 million to expand homeownership for native 

Hawaiians through a nonprofit organization that will provide interim construction loans with 

no down payment. The same bank committed to providing a $365,000 grant to the nonprofit 

to support the operations of the construction loan fund. Another event in Boston helped 

increase awareness of the Boston Housing Authority’s homeownership programs, resulting in 

20 families becoming first-time homeowners in 2023. 

The FDIC is committed to promoting access to capital for small businesses in underserved 

communities. As of December 31, 2023, the FDIC engaged with banks and community 

organizations through 34 outreach events. These events increased shared knowledge and 

supported collaboration among financial institutions and other community, and small 

business development organizations. In Michigan, the FDIC’s Supporting Black and Brown 

Small Businesses event led to a featured bank committing $600 training scholarships for small 

business clients. In Kansas City, the Expanding Access to Small Business Credit Resources event

resulted in $7,500 in bank donations to nonprofits serving small businesses, while fostering 

five new partnerships between community development financial institutions (CDFIs) 

and banks. 

Also in 2023, the FDIC continued its collaboration with the Small Business Administration 

(SBA) and U.S. Department of Agriculture (USDA) on the “Path to Prosperity” economic 

development series. The series reached small businesses in rural communities, with an 

emphasis on underserved and minority-owned firms. The FDIC co-hosted ten regional small 

business conferences with the SBA and USDA. Information gained through this interagency 

partnership indicated that these conferences were collectively attended (in person or

virtually) by over 1,700 attendees. Registration data indicates that over 1,000 attendees 

identified as small business owners. Participants engaged with financial institutions, technical 

assistance providers, and administrators of federal and municipal small business programs. 

As a result of this interagency collaboration, tracking data indicates 459 small businesses were 

matched to lending, capacity-building, contracting, and technical assistance opportunities. 

The series covered various public programs designed to support small businesses and 

included the participation of 71 state and federal 

agency partners. 

As part of the FDIC’s engagement with Historically 

Black Colleges and Universities (HBCUs) during 2023, 

the FDIC continued participation in the Economic 

Development Cluster, a Federal Interagency Working 

Group of the White House Initiative on HBCUs, to 

host a series of forums to leverage HBCU economic 

assets to expand capital projects, infrastructure, and 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 72 

programming for their growth and advancement. For example, the Chicago Region hosted 

an event at Central State University in Ohio encouraging financial institutions to support 

community development and service opportunities at HBCUs. Also, a webinar in the Kansas 

City Region focused on workforce development opportunities at HBCUs in Missouri. As a 

result of this engagement, the FDIC fostered several new partnerships with banks and federal 

agencies resulting in career opportunities for HBCU students, including a collaboration 

between a bank and Harris-Stowe State University to help HBCU students to obtain 

professional attire as they enter the workforce.

The FDIC also provided banks with CRA technical assistance. This included 33 CRA roundtables 

or forums designed to help banks identify CRA-qualifying collaboration opportunities. One 

event in New England provided insight into how financial institutions and community-based 

organizations can partner with the State Small Business Credit Initiative to access capital 

needed to invest in job-creating opportunities. Following the event, Community Affairs staff 

convened a meeting with the leader of a state bank trade group and a Native American Tribe to 

explore regional bank support for the tribe. 

FINANCIAL EDUCATION AND OUTREACH

Financial education is central to the FDIC’s efforts to expand economic inclusion and promote 

confidence in the banking system. Effective financial education helps people gain the 

skills and confidence necessary to sustain a banking relationship, achieve financial goals, 

and improve financial well-being. For more than 22 years, the FDIC Money Smart financial 

education curricula and supporting resources have offered non-copyrighted, high-quality, free 

financial education training resources for banks, schools, colleges, nonprofits, communitybased organizations, and other stakeholders to meet the financial education needs of people 

of all ages and small businesses. 

The FDIC works to raise awareness about the importance of consumer financial education and 

share its resources through outreach events and activities to consumers and communities 

across the nation. This includes conducting FDIC-led national training webinars and town 

halls, as well as exhibiting and speaking 

at conferences with community leaders, 

practitioners, and other stakeholders. The FDIC 

also maintains resources that help consumers 

and communities understand important 

consumer protection information, such as how 

deposit insurance works, how to resolve issues 

with their banks, and understanding consumer 

financial protection laws and consumer rights.

Money Smart Program

Money Smart instructor-led curricula and self-paced resources are designed to help 

communities and people of all ages by providing practical guidance on how to make 

informed financial decisions, develop a positive banking relationship, and protect against 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 73 

financial scams. Curricula materials are available 

in multiple languages, Braille, and large print. Selfpaced products, which can be accessed by consumers 

directly, complement instructor-led materials delivered

in-person or online. Regular updates ensure that 

Money Smart benefits from user feedback and current 

instructional best practices. The FDIC helps consumers 

and organizations effectively use Money Smart, including 

through over 1,000 Money Smart Alliance members, as 

well as national webinars to the general public. 

How Money Smart Are You? is one of the FDIC’s most 

popular resources with more than 1.8 million views on www.fdic.gov. Since launching How

Money Smart Are You? in September 2021, the FDIC has issued more than 260,000 certificates 

of completion and has more than 75,000 player accounts. More than 94 percent of players who 

access How Money Smart Are You? indicate they learned something from the experience. How

Money Smart Are You? also allows organizations such as schools, colleges, nonprofits, housing 

counseling centers, and banks to create organization accounts. More than 1,200 organizations 

now have accounts so they may track player progress and enhance learning. Organizations 

or individuals interested in learning more about How Money Smart Are You? should contact

the Money Smart financial education team at CommunityAffairs@fdic.gov or visit How Money 

Smart Are You? on www.fdic.gov. In 2023, FDIC launched a formal evaluation of How Money 

Smart Are You? to learn how to make user-focused improvements to the platform.

Outreach and Engagement Highlights 

Throughout 2023, the FDIC held 17 Money Smart Alliance events or meetings online, reaching 

more than 1,200 trainers, or potential trainers, with an in-depth overview of FDIC consumer 

education resources. The FDIC also answered questions and helped organizations with 

tips and strategies for integrating or learning more about the Money Smart curricula. More

than two dozen one-on-one meetings were held with organizations (such as, educators, 

HUD-certified financial counselors, Black, Indigenous, and People of Color (BIPOC)-serving 

organizations, and veterans) looking for additional information about integrating or learning 

more about Money Smart.

In April 2023, the FDIC launched its revamped Money Smart for Young Adults (MSYA) curriculum

during National Financial Capability Month. The new MSYA seeks to help young adults make 

better financial choices early in life that can contribute to a long-lasting, positive impact on 

their financial futures. The webinar also featured the Money Smart Guide to Organizing Reality 

Fairs, designed to help banks and other intermediaries offer youth and young adults a realworld simulation of an adult’s financial life. Since launching in December 2022, MSYA has 

been downloaded more than 3,500 times and viewed online 21,700 times. The Guide to 

Organizing Reality Fairs has been downloaded nearly 4,800 times and received more than 

3,600 page views.

In June 2023, the FDIC worked with the CFPB to conduct a Money Smart Train-the-Trainer and 

Money Smart Alliance national webinar for World Elder Abuse Awareness Day. The FDIC and 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 74 

CFPB highlighted the growing prevalence of scams targeting older adults and how Money 

Smart for Older Adults (MSOA) can be deployed to combat this troubling trend. Visits to the 

CFPB MSOA website increased 1,000 percent compared to the two days immediately prior 

to the event while increasing traffic to the FDIC MSOA website by 25 percent. In March of 

2023, the FDIC MSOA product was featured in a CFPB Webinar series aimed at Combatting 

Elder Financial Exploitation. That event had over 1,464 views by December 31, 2023. And in 

September of 2023, the MSOA was once again featured at a Meet the Bank Regulators event 

hosted by the CFPB and had over 390 individuals in attendance.

As of October 1, 2023, MSOA has been distributed in hard copy to over a million recipients 

during in-person sessions. The American Bankers Association (ABA) Foundation found that 

the MSOA is the number one used Instructor-led curricula, after bank proprietary products 

aimed at preventing financial abuse of older adults. The FDIC also unveiled an updated MSOA 

website, featuring improved navigability of the available resources. 

In 2023, for the first time, MSOA was featured in AARP (formerly, the American Association 

of Retired Persons) publications. The results of a joint study with the AARP on the MSOA was 

completed in 2022 and its findings, released in December 2023, revealed that older adults 

who received the MSOA curriculum demonstrated improved behaviors, skills, confidence, and 

knowledge about financial exploitations scams, even among those who were already highly 

aware of these types of scams. 

Advancing Financial Education and Capability

Throughout 2023, the FDIC continued to support consumer financial education collaborations 

at the local and national levels by providing technical assistance and resources throughout 

the country, with a focus on unbanked and underbanked households and LMI communities. 

In particular, the FDIC continued its efforts to improve the financial capability and economic 

empowerment among BIPOC communities. Highlights of our work in this area are presented 

below.

Juntos FDIC (Together FDIC) Pilot

The Juntos FDIC (Together FDIC) pilot utilizes the Money Smart program to bring financial 

education to more Hispanic-serving organizations (HSOs). The pilot began in January 2023, 

recognizing the importance of increasing access to financial education and financial services 

for the U.S. Hispanic population in response to stakeholder feedback.14

Through Juntos FDIC, the FDIC has established collaborative partnerships with two 

national HSOs with affiliate networks of more than 200+ Hispanic-serving communitybased organizations. Through these partnerships, Juntos FDIC has connected with over 

80 organizations dedicated to strengthening and advancing economic mobility in Latino 

communities. Juntos FDIC conducted two kick-off meetings (in English and Spanish) with 44 

participating organizations. As a result of these interactions, the FDIC forged new relationships 

14 The 2021 FDIC National Survey of Unbanked and Underbanked Households found that Hispanic households 

are unbanked at a rate that is more than twice the national average, and 4.5 times more than white households. 

Additionally, stakeholder feedback (June 2022) indicated a lack of awareness by the U.S. Hispanic population of the 

FDIC’s mission and its economic inclusion resources.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 75 

with 40 HSOs and provided these organizations with technical support and tools to implement 

financial education programs, including delivering Money Smart Train-the-Trainer sessions to 

23 organizations.

The pilot program leverages FDIC professional staff, most bilingual, to deliver financial 

education. As a result, Juntos FDIC delivered the first Money Smart Train- the-Trainer events 

in Spanish (for Money Smart for Small Business and How Money Smart Are You?) within a span 

of six months, and has conducted needs assessment and follow-up meetings with HSOs in 

Spanish. Approximately 217 prospective Money Smart Instructors from 23 HSOs benefited 

from these comprehensive training sessions.

Juntos FDIC also has facilitated collaborations between banks and community organizations 

to increase awareness of resources and to provide technical assistance. For example, one 

pilot participant, an FDIC-supervised state savings bank, requested guidance on how to 

expand outreach and support to a growing population of minority-owned small businesses 

in its market. Juntos FDIC connected the bank with a fellow pilot participant, a local CDFI, 

which shared lessons learned resulting in the organizations establishing a referral-based 

relationship. 

Additional accomplishments from the Juntos FDIC pilot include:

 Onboarded ten FDIC professional staff from across the Corporation on the FDIC 

Money Smart financial education curriculum as Train-the-Trainer instructors;

 Developed an internal online client-relationship management tool to facilitate 

participant follow-up and monitoring;

 Created and translated into Spanish new training materials for Train-the-Trainers 

sessions;

 Provided consulting and technical assistance to community bank staff on 

strategies to develop bank-led financial education programs, targeted outreach 

to minorities and the integration of emerging minority consumer segments into 

financial institutions’ core businesses;

 Deployed financial capability building programs in Puerto Rico, Maryland, 

Pennsylvania, Florida, Illinois, New York, Colorado, Texas, New Jersey, 

Connecticut, South Carolina, North Carolina, Georgia, Delaware, Massachusetts, 

Tennessee, Kansas, and California; and

 Reached more than an estimated 130 Spanish-speaking households since the 

start of the pilot through a range of initiatives, including financial education 

workshops, capacity-building trainings, small business development series, 

financial literacy webinars, and savings club programs.

Collaborations with Federal Agencies 

In 2023, the FDIC continued its active membership on the federal Financial Literacy and 

Education Commission (FLEC). This includes participating on various working groups, notably 

the FLEC Digital Assets, Basic Financial Capability, and Post-Secondary Education working 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 76 

groups. Alongside other FLEC member agencies, the FDIC provided technical assistance and 

contributed resources to the drafting of the U.S. Department of the Treasury report entitled 

The Impact of Climate Change on American Household Finances. 

The FDIC also continued to support and actively participate in the Federal Trade Commission 

(FTC) Stop Seniors Scams Act Advisory Group, which consists of federal agency partners, 

consumer advocates, and industry representatives, as well as state and local governmental

entities, that focus on ways to better identify and stop scams that affect older adults. The 

FDIC’s contributions to the Advisory Group will be included in congressionally-mandated 

reports from the FTC in October 2024. The FDIC is also participating in the Institute of 

Museum and Library Services Interagency Task Force on Information Literacy. The task 

force seeks to facilitate the development of a portal of resources, including Money Smart, 

to bridge information literacy research and practice to advance information literacy within 

communities.

In 2023, the FDIC expanded its collaboration with the U.S. Department of Housing and Urban 

Development (HUD). The agencies jointly hosted a national webinar targeting HUD-assisted 

communities in order to share strategies to support financial education. During the event, 

the FDIC shared information on its Money Smart and How Money Smart Are You? programs 

and #GetBanked Initiative and how the agency works to ensure affordable mortgage lending. 

Through this effort, the FDIC provided resources to over 1,000 attendees.

As a part of its commitments under Interagency Task Force PAVE, in April 2023, the FDIC 

published several public-facing resources to provide education and information to consumers 

and bankers. These included a webpage on www.fdic.gov titled FDIC Tips on Appraisal Bias and 

Valuation to Address Consumers’ Frequently Asked Questions, regulatory updates in Consumer 

Compliance Supervisory Highlights, and an article in the June 2023 issue of FDIC Consumer 

News titled Understanding Appraisals and Why They Matter. In addition, the FDIC’s Information 

and Support Center complaint submission form has been updated to include appraisal-related 

issues.

Consumer News

Consumer News is the FDIC’s monthly newsletter to consumers. It provides practical guidance 

on financial services, including helpful hints, quick tips, links to useful resources, and 

common-sense strategies to protect consumers’ hard-earned dollars.

The FDIC released 12 issues of Consumer News in 2023, addressing some of the biggest 

concerns consumers face, including rising interest rates, crypto-assets, and cybersecurity. 

New areas of discussion in 2023 included banking service products and financial tips for 

individuals with disabilities, what consumers ought to consider when using a nonbank, and 

understanding appraisals in support of the PAVE Interagency Task Force Initiatives. 

The subscriber list continues to grow, surpassing 169,000 in 2023, furthering the outreach to 

communities throughout the country. All Consumer News articles are scheduled for release 

in both English and Spanish during the first week of each month and promoted through 

subscriptions, social media, and the www.fdic.gov website.
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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 77 

Money Smart News

Money Smart News is a monthly publication that highlights how organizations successfully 

implement and promote the Money Smart curricula and resources. In 2023, Money Smart News

featured nine success stories documenting how financial institutions, educators, nonprofits, 

and other community-based organizations used Money Smart curricula and resources to 

improve the financial well-being of the consumers and communities they serve. New features 

included “Tips and Techniques” and “Reality Fair Toolkit” for youth. Money Smart News is 

distributed to more than 109,000 people interested in delivering financial education to others. 

CONSUMER COMPLAINTS AND INQUIRIES

The FDIC National Center for Consumer and Depositor Assistance (NCDA) is comprised of staff 

from coast-to-coast, with a centrally located hub in the Kansas City Regional Office. The NCDA 

fulfills two mission-critical functions for the FDIC: 1) investigating and responding to consumer 

complaints and inquiries involving FDIC-supervised institutions; and 2) promoting public 

awareness and understanding of FDIC deposit insurance coverage, ensuring depositors and 

bankers have ready access to information regarding deposit insurance rules and requirements.

The FDIC’s NCDA helps consumers by receiving, investigating, and responding to consumer 

complaints about FDIC-supervised institutions and answering inquiries about federal 

consumer banking laws and regulations, FDIC operations, and other related topics. Assessing 

and resolving these matters helps the agency identify trends or problems related to consumer

protections, understand the public perception of consumer protection issues, formulate 

policy that aids consumers, and foster confidence in the banking system.

The FDIC regularly updates metrics on requests from the public for FDIC assistance. The 

webpage is located at https://www.fdic.gov/transparency/consumers.html.

CONSUMER COMPLAINTS BY TOPIC AND ISSUE

Through December 31, 2023, the FDIC closed 20,185 written consumer complaints and 

inquiries. Of these, 10,426 were referred out to other federal banking agencies for review, 

while the FDIC handled the remaining 9,759. The FDIC responded to 98.3 percent of written 

complaints within timeframes established by corporate policy and acknowledged 100 percent 

of all consumer complaints and inquiries within 14 days. The FDIC Annual Performance Goal 

for both metrics is 95 percent and 100 percent, respectively.

The top five identified products among consumer complaints and inquiries about FDICsupervised institutions, as percent of total volume, included credit cards (30 percent of total), 

checking accounts (20 percent), consumer lines of credit and installment loans (16 percent), 

and residential real estate (5 percent).

The top five issues identified among consumer complaints and inquiries, as a percent of 

total volume, included credit reporting (15 percent), disclosures (7 percent), loan forgery/ID 

theft (6 percent), deposit account transaction discrepancies (5 percent), and error resolution 

procedures (5 percent). The FDIC helped consumers receive approximately $7 million in 

refunds and voluntary compensation from financial institutions through December 31, 2023. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 78 

CASES CLOSED 2023 YTD

0 500 1000 1500 2000 2500 3000

Q1

Q2

Q3

Q4

Written Response Referrals Calls

TOP PRODUCTS 2023 YTD

0 200 400 600 800 1000 1200 1400

Q1

Q2

Q3

Q4

Checking

Consumer Lines of Credit

Credit Cards Installment Loans

Residential Real Estate
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 79 

Deposit Insurance Coverage Information Assistance and Outreach 

In order to fulfill its mission to promote public confidence in the banking system, the FDIC 

works to ensure that bankers and consumers have access to accurate information about FDIC 

rules for deposit insurance coverage. Through December 31, 2023, the FDIC’s Contact Center 

handled 88,381 telephone cases pertaining to a variety of issues, including 37,779 that were 

identified as deposit insurance-related inquiries. The majority of deposit insurance inquiries 

are forwarded to the Deposit Insurance (DI) Unit for handling. In addition to the telephone 

inquiries, the FDIC received over 3,900 written deposit insurance inquiries from consumers 

and bankers. Of these inquiries, 100 percent received responses within two weeks, as required 

by corporate policy. FDIC deposit insurance specialists assist depositors in identifying 

potentially fraudulent websites posing as legitimate FDIC-insured institutions. Additionally, 

the FDIC received over 750 inquiries or complaints regarding potentially false or misleading 

statements about FDIC deposit insurance through a complaint portal that was established in 

mid-2022; 100 percent of the complaints received were reviewed by staff in the Legal division. 

The two large bank failures that occurred in March of 2023 resulted in a 565 percent surge 

increase for that month in deposit insurance calls and correspondence received and handled. 

This resulted in just-in-time training of approximately 60 FDIC employees to temporarily 

provide supplemental assistance in handling incoming deposit insurance calls. Through 

December 31, 2023, the FDIC received and handled 34,046 deposit insurance-related calls 

(forwarded from the FDIC Contact Center) and written inquiries combined, the largest number 

of inquiries handled since 2009.

The top five deposit insurance issues identified as a percent of total volume among calls 

and correspondence handled through December 31, 2023, include informal revocable trust 

accounts (26 percent), formal revocable trust accounts (11 percent), single accounts (7 

percent), joint accounts (7 percent) and Electronic Deposit Insurance Estimator (EDIE) inquiries 

(4 percent).

Through December 31, 2023, the FDIC identified and took appropriate action on over 200 

other matters. This number includes actions taken regarding websites that used the Member 

FDIC logo or FDIC name but were not operated by FDIC-member banks, reviews of potential 

violations of section 18(a)(4) of the Federal Deposit Insurance Act,

15 referrals to other 

law enforcement and regulatory agencies for further action, and issuances of cease and 

desist letters. 

Failed Bank Resolution and Receivership Management

Within the FDIC, the Division of Resolutions and Receiverships (DRR) is responsible for 

resolving the failure of IDIs with assets less than $100 billion; the Division of Complex 

Institution Supervision and Resolution (CISR) is responsible for resolving the failure of IDIs 

with assets of more than $100 billion.

15 The Federal Deposit Insurance Act establishes and sets powers, responsibilities, and administration of the FDIC. 

Section 18(a)(4) of the Act states, “No person may represent or imply that any deposit liability, obligation, certificate, 

or share is insured or guaranteed by the Corporation, if such deposit liability, obligation, certificate, or share is not 

insured or guaranteed by the Corporation.”
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 80 

When an IDI fails, the chartering authority typically appoints the FDIC as receiver, and the FDIC 

employs a variety of strategies to ensure the prompt payment of deposit insurance to insured 

depositors and to provide for the least costly resolution transaction to the DIF. No depositor 

has ever experienced a loss on their insured funds as a result of an IDI failure.

INSURED DEPOSITORY INSTITUTION FAILURES

During 2023, there were five IDI failures. Prior to this year, the last IDI failure occurred in 2020. 

For every IDI failure in 2023, the FDIC successfully contacted all qualified and interested 

bidders to market and sell these institutions. In those cases where the failure occurred on a 

Friday, the assuming institution assumed all deposits and all depositors had access to insured 

funds within one business day. In those cases where the failure occurred on any other day of 

the week, depositors had access to insured funds within two business days. Further, there 

were no losses to insured depositors, and no appropriated funds were required to pay insured 

depositors. The following chart provides a comparison of IDI failure activity over the past 

three years.

Failure Activity Dollars in Billions

2023 2022 2021

Total Institutions 5 0 0

Total Assets of Failed Institutions* $532.2 $0 $0

Total Deposits of Failed Institutions* $440.6 $0 $0

Estimated cost of Failure $40.4 $0 $0

Covered by the Special Assessment ($20.4) $0 $0

Estimated Loss to the DIF $20.0 $0 $0

*Total assets and total deposits data are based on the last quarterly Call Report filed by the institution prior to failure.

The five IDI failures in 2023 are discussed below.

Silicon Valley Bank

Silicon Valley Bank (SVB), Santa Clara, California was closed by the California Department of 

Financial Protection & Innovation on March 10, 2023. The FDIC was appointed receiver. At the 

time of closure, SVB had approximately $167 billion in total assets and about $119 billion in 

total deposits. Following the closure, the FDIC created Silicon Valley Bridge Bank, National 

Association. The deposits and substantially all assets and all Qualified Financial Contracts 

were transferred to the bridge bank. The transfer of deposits was completed under the 

systemic risk exception. Generally, such a transaction is subject to the statutory “least cost 

test” requiring that the transaction be less costly to the Deposit Insurance Fund than any other 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 81 

possible transactions, including liquidation of the failed bank. There is an exception to that 

requirement in the event that it is determined that the least costly transaction would have 

serious adverse effects on economic conditions or financial stability. Such a determination 

must be made by the Secretary of the Treasury in consultation with the President, based 

on recommendations by both the FDIC and the Board of Governors of the Federal Reserve 

System. This exception, commonly referred to as the systemic risk exception, was undertaken 

in this case, enabling the FDIC receiver of SVB to transfer all of the deposits, as defined in the 

FDIA, to the bridge bank.

On March 26, 2023, the FDIC entered into a purchase and assumption agreement for the 

deposits and loans of Silicon Valley Bridge Bank, National Association, by First-Citizens Bank & 

Trust Company, Raleigh, North Carolina. The transaction included the purchase of about $72 

billion of Silicon Valley Bridge Bank, National Association’s assets at a discount of $16.5 billion. 

Approximately $90 billion in securities and other assets were retained in the receivership for 

later disposition by the FDIC. In addition, the FDIC received equity appreciation rights in First 

Citizens BancShares, Inc., Raleigh, North Carolina, common stock with a potential value of up 

to $500 million. On March 28, 2023, the FDIC exercised these rights and received the maximum 

proceeds of $500 million. The FDIC and First-Citizens Bank & Trust Company entered into a 

shared-loss transaction on the commercial loans it purchased from the former Silicon Valley 

Bridge Bank, National Association. First-Citizens Bank & Trust Company also assumed all loanrelated Qualified Financial Contracts. The estimated cost of SVB’s failure is approximately 

$21.8 billion of which $19.2 billion will be recovered under the special assessment for a net 

estimated loss to the DIF of $2.6 billion. The exact cost will be determined when the FDIC 

terminates the receivership.

Signature Bank

Signature Bank, New York, New York, was closed by the New York State Department of 

Financial Services on March 12, 2023. The FDIC was appointed receiver. To protect depositors, 

the FDIC transferred the deposits and substantially all of the assets of Signature Bank to 

Signature Bridge Bank, National Association. The transfer of the deposits was completed 

under the systemic risk exception, as described above. Signature Bank had total assets of 

$110.4 billion and total deposits of $88.6 billion as of December 31, 2022.

On March 19, 2023, the FDIC entered into a purchase and assumption agreement for 

substantially all deposits and certain loan portfolios of Signature Bridge Bank, National 

Association, by Flagstar Bank, National Association, Hicksville, New York, a wholly owned 

subsidiary of New York Community Bancorp, Inc., Westbury, New York. The transaction 

included the purchase of about $38.4 billion of Signature Bridge Bank, National Association’s 

assets, including loans of $12.9 billion purchased at a discount of $2.7 billion. Approximately 

$60 billion in loans remained in the receivership for later disposition by the FDIC. By December 

31, 2023, the FDIC had disposed of substantially all of these retained loans. In addition, the 

FDIC received equity appreciation rights in New York Community Bancorp, Inc., common 

stock. On May 16, 2023, the FDIC received $392 million from the sale of the stock, which was 

received upon the FDIC exercising the rights noted above. The estimated cost of Signature 

Bank’s failure is approximately $1.8 billion of which $1.2 billion will be recovered under the 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 82 

special assessment for a net estimated loss to the DIF of $600 million. The exact cost will be 

determined when the FDIC terminates the receivership.

Signature Bank, New York, New York, was the 29th largest bank in the country, and its failure 

constituted the fourth largest bank failure in U.S. history. The FDIC was the primary federal 

regulator of Signature Bank and in late March, the FDIC Chairman commissioned an internal 

review of the agency’s supervision of Signature Bank, and asked the FDIC’s Chief Risk Officer 

(CRO) to produce a report to the FDIC Board of Directors for release to the public. The CRO 

issued the report on April 28, 2023. The report clearly identifies the root cause of Signature 

Bank’s failure as poor management; it also identifies areas where the FDIC’s supervisory 

efforts could have been more timely, forward looking, and forceful. Also, the report includes 

thoughtful recommendations on matters for further study by the FDIC related to examination 

guidance, processes, and resources. The FDIC continues to focus attention and action on 

these recommendations. 

First Republic Bank

First Republic Bank, San Francisco, California, was closed by the California Department 

of Financial Protection and Innovation on May 1, 2023. The FDIC was appointed receiver. 

To protect depositors, the FDIC entered into a purchase and assumption agreement with 

JPMorgan Chase Bank, National Association, Columbus, Ohio, to assume the deposits and 

substantially all of the assets of First Republic Bank. The FDIC and JPMorgan Chase Bank 

entered into two shared-loss transactions on the single family and commercial loans it 

purchased. As of April 13, 2023, First Republic Bank had approximately $229.1 billion in total 

assets and $103.9 billion in total deposits. The estimated cost to the DIF for this failure is about 

$16.7 billion. The final cost will be determined when the FDIC terminates the receivership. The 

resolution of First Republic Bank involved a highly competitive bidding process and resulted in 

a transaction consistent with the least-cost requirements of the FDI Act.

First Republic was the fourteenth largest bank in the country, and the second largest bank 

supervised by the FDIC, and its failure constituted the second largest bank failure in U.S. 

history. In May 2023 the FDIC Chairman commissioned an internal review of the agency’s 

supervision of First Republic led by the CRO. The CRO issued the report on September 8, 2023. 

The report cites a loss of market and depositor confidence, resulting in a bank run following 

the March 2023 failures of Silicon Valley Bank and Signature Bank as the primary cause of 

failure, but notes there were attributes of First Republic’s business model and management 

strategies that made it more vulnerable to interest rate changes and contagion that ensued 

following the failure of SVB. Also, the internal review identifies items for further study focusing 

on FDIC examiner guidance and processes. The FDIC continues to focus attention and action 

on these items.

Heartland Tri-State Bank

Heartland Tri-State Bank, Elkhart, Kansas, was closed by the Kansas Office of the State Bank 

Commissioner on July 28, 2023. The FDIC was appointed receiver. To protect depositors, the 

FDIC entered into a purchase and assumption agreement with Dream First Bank, National 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 83 

Association, of Syracuse, Kansas, to assume the deposits of Heartland Tri-State Bank. The FDIC 

and Dream First Bank entered into a shared-loss transaction agreement on the commercial 

loans it purchased. As of March 31, 2023, Heartland Tri-State Bank had approximately $139 

million in total assets and $130 million in total deposits. The estimated cost to the DIF for 

this failure is $54.2 million. The final cost will be determined when the FDIC terminates the 

receivership. Compared to other alternatives, Dream First Bank, National Association’s 

acquisition was the least costly resolution for the DIF.

Citizens Bank

Citizens Bank, Sac City, Iowa, was closed by the Iowa Division of Banking on November 3, 2023. 

The FDIC was appointed receiver. To protect depositors, the FDIC entered into a Purchase and 

Assumption Agreement with Iowa Trust & Savings Bank, Emmetsburg, Iowa, to assume the 

deposits and purchase essentially all of the assets of Citizens Bank. As of September 30, 2023, 

Citizens Bank had approximately $66 million in total assets and $59 million in total deposits. 

The estimated cost to the DIF for this failure is $14.8 million. The final cost will be determined 

when the FDIC terminates the receivership. Compared to other alternatives, Iowa Trust & 

Savings Bank’s acquisition was the least costly resolution for the DIF.

RECEIVERSHIP MANAGEMENT ACTIVITIES

As part of the receivership process, the FDIC as receiver manages failed IDIs and their 

subsidiaries with the goal of expeditiously winding up their affairs. Assets not sold to an 

assuming institution through the resolution process are retained by the receivership and 

promptly valued and liquidated through different sales channels – cash sales, securitizations, 

and joint venture transactions – to maximize the return to the receivership estate.

As a result of the large IDI failures in 2023, the book value of assets in inventory increased 

to a historical high of $202.3 billion. During 2023, the FDIC engaged in numerous activities 

to liquidate these retained assets. These activities included the exercise and sale of equity 

appreciation rights previously noted, as well as the significant sales of loans and securities 

resulting in total proceeds to the FDIC of over $108.4 billion. The cumulative effect of these 

activities resulted in a total book value of assets in liquidation of $84.6 billion at the end 

of 2023.16

Also, during 2023, for 95 percent of failed institutions, at least 90 percent of the book value 

of marketable assets was marketed for sale within 90 days of an institution’s failure for cash 

sales, and within 120 days for structured sales.

The following chart shows the year-end balances of assets in liquidation by asset type.

16 In January 2024, the FDIC, as receiver for Silicon Valley Bridge Bank, N.A. (SVBB), used structured transactions 

(structured sale of guaranteed notes (SSGNs) and a securitization or collectively, “trusts”) to sell $10.5 billion of 

Ginnie Mae Project Loan Securities and a $36.1 billion Purchase Money Note (PMN) issued by First-Citizens Bank & 

Trust Company (FCB), respectively.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 84 

Assets in Liquidation Inventory by Asset Type Dollars in Millions

Asset Type 12/31/23 12/31/22 12/31/21

Securities $12,917 $5 $7

Consumer Loans 0 0 0

Commercial Loans 10 1 2

Real Estate Mortgages 162 1 2

Other Assets/Judgments 4,237 6 18

Owned Assets 30 0 0

Net Investments in Subsidiaries 622 18 20

Structured and Securitized Assets 66,663 8 43

Total $84,641 $39 $92

Proceeds generated from asset sales and collections are used to pay receivership claimants, 

including depositors whose accounts exceeded the deposit insurance limit. During 2023, 

receiverships paid dividends of $289,519 to depositors whose total deposits were not assumed 

by an acquiring institution and whose accounts exceeded the deposit insurance limit.

Once the assets of a failed institution have been sold and liabilities extinguished, the final 

distribution of any proceeds is made, and the FDIC terminates the receivership. In 2023, 

a total of 65 receiverships were terminated, which resulted in a net decrease of 58 active 

receiverships under management. Further, the FDIC terminated at least 75 percent of 

receiverships that were at least two years old and were not subject to unresolved loss-share, 

structured transaction, environmental, legal, or tax impediments at the start of the year.

The following chart shows overall receivership activity for the FDIC in 2023.

Receivership Activity

Active Receiverships as of 12/31/22 132

New Failed Bank Receiverships17 7

Receiverships Terminated 65

Active Receiverships as of 12/31/23 74

Professional Liability and Financial Crimes Recoveries

The FDIC investigates IDI failures to identify potential claims against directors, officers, 

securities underwriters and issuers, financial institution bond carriers, appraisers, attorneys, 

accountants, mortgage loan brokers, title insurance companies, and other professionals 

who may have caused losses to IDIs that failed and FDIC receiverships. The FDIC pursues 

meritorious claims against these parties that are expected to be cost effective.

17 Silicon Valley Bank and Signature Bank are counted as both a Bridge Bank Receivership and a Failed Bank 

Receivership.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 85 

During 2023, the FDIC recovered $40.8 million from professional liability settlements. The 

FDIC authorized five professional liability lawsuits during 2023. As of December 31, 2023, the 

FDIC’s caseload included 24 professional liability lawsuits (up 9 from 15 at year-end 2022), 

and open investigations in 74 claim areas out of 8 institutions. The FDIC continued to conduct 

investigations of claims out of recently failed IDIs, but no investigations reached the 18-month 

point (an internal goal) after the institutions’ failure dates in 2023.

As part of the sentencing process, for those convicted of criminal wrongdoing against an 

insured institution that later failed, a court may order a defendant to pay restitution or to 

forfeit funds or property to the receivership. The FDIC, working with the Department of Justice 

in connection with criminal restitution and forfeiture orders issued by federal courts and 

independently in connection with restitution orders issued by the state courts, collected $5.1 

million in 2023. As of December 31, 2023, there were 1,601 active restitution and forfeiture 

orders (down 34 from 1,635 at year-end 2022). This includes 11 orders held by the Federal 

Savings and Loan Insurance Corporation (FSLIC) Resolution Fund (i.e., orders arising out of 

failed financial institutions in receivership or conservatorship by the FSLIC or the Resolution 

Trust Corporation).

Minority Depository Institutions and Community

Development Financial Institutions

MINORITY DEPOSITORY INSTITUTION ACTIVITIES

The preservation and promotion of minority depository institutions (MDIs) remains a longstanding, top priority for the FDIC. The FDIC’s research study, Minority Depository Institutions: 

Structure, Performance, and Social Impact, published in 2019, found that MDIs play a vital role 

in providing mortgage credit, small business lending, and other banking services to minority 

and LMI communities. MDIs are anchor institutions in their communities and play a key role in 

building a more inclusive financial system.

Since 2020, significant new sources of private and public funding have become available 

to support FDIC-insured MDIs and Community Development Financial Institutions (CDFIs), 

collectively known as “mission-driven banks.” During 2023, the FDIC pursued several 

strategies to support MDIs. These included: increasing engagement and representation; 

facilitating partnerships to provide new capital and other tools and resources; promoting the 

MDI sector through advocacy; providing outreach, technical assistance, and education and 

training for MDIs; and building internal capacity.

ENGAGEMENT AND REPRESENTATION

The FDIC’s MDI Subcommittee of CBAC is composed of nine diverse MDI executives 

representing all types of MDIs across the country with varying asset sizes and lines of business. 

The FDIC provides a venue for minority bankers to discuss key issues, share feedback on 

program initiatives, and showcase MDI best practices. Representatives from four MDIs 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 86 

also serve on the 18-member CBAC and one serves on the ComE-IN to further bring MDI 

perspectives and issues to the table.

In 2023, the MDI Subcommittee held two in-person meetings. The meetings included 

discussions on topics such as banking and economic conditions, supervisory issues, thirdparty risk guidance, cybersecurity, and an update on the DIF. The meetings also included an 

MDI Spotlight segment that featured three private funds that provide resources to MDIs and 

bank executives sharing experiences with new, unconventional growth opportunities. 

During 2023, the FDIC continued to engage with mission-driven bank trade groups and large 

and regional financial institutions to facilitate effective implementation of some of the new 

resources becoming available to mission-driven banks.

PARTNERSHIPS

The FDIC co-sponsored the biennial interagency MDI and CDFI Bank Conference in November 

2023, along with the FRB and OCC. The conference, MDI and CDFI Bank Partnership Exchange, 

featured opportunities for MDIs and CDFI banks to explore partnership opportunities with 

large and regional banks and other supporting resources. The conference included regulatory 

updates, a panel where various agencies and private sector representatives discussed 

programs and initiatives that could benefit MDIs and CDFI banks, opportunities for attendees 

to engage in one-on-one conversations with federal banking regulatory experts regarding 

supervisory topics, and an update on the modernization of CRA regulations. The conference 

concluded with a networking event where MDIs and CDFI banks had the opportunity to meet 

one-on-one with large and regional banks interested in exploring partnerships supportive of 

mission-driven banks. 

ADVOCACY

It is important to promote the visibility of MDIs, to tell their stories, and showcase the 

important role they play in their communities. In 2023, the FDIC recorded four videos of 

MDI executives sharing their institutions’ “Origin Stories,” highlighting the reasons their 

institutions were formed, and describing how they have served their communities over time. 

In addition, senior agency leaders emphasized the significance of mission-driven banks in 

numerous external speaking engagements and through posts on FDIC social media channels 

and its website.

OUTREACH, TECHNICAL ASSISTANCE, AND EDUCATION

During the year, the FDIC continued efforts to improve communication and interaction 

with MDIs and to respond to the concerns of minority bankers. The agency maintains active 

outreach with MDI trade groups and offers to arrange annual meetings between FDIC regional 

management and each MDI’s Board of Directors to discuss issues of interest. The FDIC 

conducts an annual survey to obtain feedback from MDIs and to help assess the effectiveness 

of the MDI program.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 87 

At the conclusion of each examination of an MDI supervised by the FDIC, the staff is available 

to return to the institution to provide technical assistance by reviewing areas of concern 

or topics of interest to the institution. The purpose of return visits is to assist management 

in understanding and implementing examination recommendations, not to identify new 

problems.

Through its public website (www.fdic.gov), the FDIC invites inquiries and provides contact 

information for any MDI to request technical assistance at any time.

In 2023, the FDIC provided 152 individual technical assistance sessions on approximately 38 

risk management, consumer compliance, and resolution topics, including:

 Applications for branch openings and closures,

 Anti-Money Laundering/Countering the Financing of Terrorism,

 Community Reinvestment Act,

 Compliance Management,

 Capital Planning and Management,

 Current Expected Credit Losses (CECL) accounting methodology,

 Corporate Governance and Strategic Planning,

 Fair Lending,

 Funding and liquidity,

 Home Mortgage Disclosure Act (HMDA),

 Information technology risk management and cybersecurity,

 Internal audit, and

 Unfair or Deceptive Acts or Practices (UDAP).

In response to questions raised by MDIs, the FDIC hosted two interagency technical assistance 

webinars along with the FRB and OCC to discuss supervisory expectations for MDIs and CDFI 

banks awarded funds from the U.S. Treasury Emergency Capital Investment Program and 

other new investments. The webinars addressed bank management’s questions regarding 

the FDIC’s examination approach for FDIC-supervised MDIs and CDFI banks deploying the 

funds. FDIC staff discussed several risk management practices institutions must consider 

when anticipating significant asset growth, expanding into new markets, and developing new 

product offerings. Staff also addressed questions regarding strategic and capital planning 

associated with new investments and awards.

The FDIC also held outreach, training, and educational programs for MDIs through conference 

calls and regional banker roundtables. In 2023, topics of discussion for these sessions included 

many of those listed above, as well as liquidity, interest rate risk and deposit monitoring 

practices, accounting, emerging risks and areas of concern, commercial real estate trends and 

activity, IT vendor management, and industry and customer reactions to bank failures. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 88 

BUILDING INTERNAL CAPACITY

In 2023, the FDIC continued an initiative that started in December 2022, training examiners of 

MDIs on the application of examination standards to the unique business models of MDIs. The 

training provides information and case studies on many of the new funding sources coming 

into MDIs and CDFI banks, as well as information regarding tools to help understand the 

communities served by MDIs. The FDIC also continued quarterly meetings of its interdivisional 

task force on MDIs to share information, identify new opportunities for supporting missiondriven banks, and ensure appropriate resources support program initiatives.

Diversity, Equity, Inclusion, and Accessibility

The FDIC continues its efforts to integrate diversity, equity, inclusion, and accessibility 

(DEIA) in all aspects of its work to support its important mission. Effective DEIA programs 

and initiatives enhance the FDIC’s work to preserve and promote public confidence in the 

U.S. financial system. The agency takes a broad view of diversity and prioritizes fostering an 

inclusive work environment built on mutual trust, respect, and dignity.

In 2023, it became apparent that the agency needed to do more to make employees feel safe, 

valued, and respected. On December 1, 2023, the FDIC issued and began to implement an 

Action Plan for a Safe, Fair, and Inclusive Work Environment that outlines steps the agency is 

taking to address harassment and discrimination in the workplace and support employees. 

The FDIC’s senior leaders are working with staff to execute each initiative in the plan.

In general, the Office of Minority and Women 

Inclusion (OMWI) spearheads the FDIC’s DEIA 

efforts, including implementation of its 2021-

2023 Diversity, Equity and Inclusion Strategic Plan, 

and is a resource to FDIC Divisions and Offices as 

they implement their own DEIA goals. 

Agency-wide, OMWI conducts workforce 

demographic analyses to identify any 

representation gaps and recommends

recruitment and retention strategies to support diverse applicant pools. OMWI also works with 

Divisions and Offices to maintain a model Equal Employment Opportunity (EEO) program by 

providing training and issuing notices to all employees about legal rights and responsibilities. 

In addition, the agency performs outreach and provides technical assistance to ensure the 

fair inclusion and utilization of minority- and women-owned businesses (MWOBs), minorityand women-owned law firms (MWOLFs), and investors in contracting and investment 

opportunities. Further, OMWI collects and evaluates self-assessment information that FDICsupervised institutions submit voluntarily about their diversity-related policies 

and procedures. 

In 2023, the FDIC made further progress in implementing agency DEIA initiatives under its 

DEI Strategic Plan. Specifically, OMWI provided training support, launched empathy training 

for all employees, and continued to work with the FDIC’s Divisions and Offices to help them 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 89 

execute their own DEIA operational plans tailored to their mission and needs. The agency also 

maintained its focus on three strategic areas: 1) implementing workforce DEIA initiatives; 2) 

enhancing Hispanic recruitment and retention; and 3) promoting financial institution diversity. 

WORKPLACE DEIA INITIATIVES

FDIC leadership promotes the vision and business 

case for DEIA by taking action to increase 

workforce diversity, providing avenues to hear 

from employee groups, maintaining equitable 

practices, and fostering an inclusive workforce. 

The FDIC continued to focus attention on 

recruitment and retention diversity initiatives,

support for first-generation professionals, and 

career development programs for the next 

generation of leaders, among several other initiatives designed to maintain a diverse and 

inclusive workforce. 

In 2023, the FDIC made small but promising progress in reducing the gap in its workforce 

participation by individuals who self-identify as Hispanic. Hispanics continue to have a 

lower-than-expected participation rate in the overall workforce and some mission-critical 

occupations as compared to the civilian labor force. The FDIC’s executive-level task force 

established to address challenges for Hispanic recruitment and retention continued to 

develop and implement outreach strategies to diversify the applicant pool for FDIC missioncritical positions. The agency also enhanced strategies designed to address female workforce 

participation, which in 2023 remained below female participation rates in the civilian labor 

force. The FDIC remains committed to recruiting strategically to reach all available talent in the 

labor market, providing advancement opportunities to all current employees, and enhancing 

employee engagement at all levels. 

FINANCIAL INSTITUTION DIVERSITY

Regularly assessing a financial institution’s diversity policies and practices pursuant to 

Section 342 of the Dodd-Frank Act supports a safer, fairer, and more inclusive banking system. 

Bringing together a variety of perspectives, experiences, and skills can foster innovation, 

improve decision making, and achieve better financial performance. Effective diversityrelated policies and programs can help financial institutions meet the diverse interests of 

shareholders, depositors, and the general public. 

In 2023, 157 FDIC-supervised financial institutions voluntarily participated in the diversity selfassessment (DSA) and submitted information for the 2022 reporting period. This represents 

an 8.7 percent decrease from the previous reporting period. Throughout the year, the FDIC 

continued its outreach to community banks and trade associations to increase awareness of 

and participation in the DSA. In support of this objective, the FDIC also launched a new office 

hours initiative to provide more hands-on technical assistance to the financial institutions.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 90 

MINORITY- AND WOMEN-OWNED BUSINESSES

The FDIC has focused on identifying barriers that underserved communities and individuals 

may face in taking advantage of FDIC procurement and contracting opportunities. In 2023, 

to promote economic inclusion, the FDIC conducted outreach to MWOBs on contracting 

opportunities and provided technical assistance to educate prospective vendors on FDIC 

programs, policies, and procedures. The FDIC continued to support increased participation of 

MWOBs by conducting market research and outreach to identify MWOBs eligible to compete 

for FDIC contracts. Further, the FDIC held Pitch Days to give MWOBs the opportunity to 

highlight their business capabilities, which helped connect MWOBs to OMWI. 

MWOB participation in 2023 FDIC contracting opportunities was strong. The FDIC awarded 

197 contracts (31.1 percent) to MWOBs out of a total of 634 issued. Total awarded contracts 

had a combined value of $1,331.2 million, of which $376.0 million (28.2 percent) went to 

MWOBs. The FDIC paid $171.4 million of its total contract payments (24.5 percent) to MWOBs 

under 317 contracts.

DIVERSE LEGAL SERVICE PROVIDER OUTREACH

The FDIC Legal Division had several major accomplishments relating to increasing diversity 

in legal contracting in 2023. This year the Legal Division hosted a Pitch Day to afford diverse 

MWOLFs, diverse attorneys at majority firms, and legal support services providers an 

opportunity to share their legal expertise and support capabilities. Legal support services 

providers assist in e-discovery, court reporting, trial preparation, expert consultation and 

testimony, and other areas in support of the Legal Division’s mission. 

In addition, the FDIC promoted meaningful relationship building between outside counsel and 

in-house attorneys responsible for engaging outside counsel through outreach events held 

by affinity organizations and bar associations. In particular, the Legal Division partnered with 

the National Association of Minority and Women Owned Law Firms (NAMWOLF) to reach out 

to prospective MWOLFs to match those firms to the FDIC’s anticipated need for outside legal 

services. The Legal Services and Special Contracts Group (LSSCG) also periodically provided a 

reference list of newly available legal services providers, highlighting MWOLFs and MWOBs for 

Legal Division personnel. 

Further, the Legal Division published an internal monthly newsletter, In the Spotlight, to 

encourage referrals of legal contracting opportunities to MWOLFs and other diverse legal 

services providers. Each issue of In the Spotlight highlighted the expertise of an individual 

diverse legal services provider. Recruitment and utilization of diverse legal services providers 

remained a prominent part of the periodic training that LSSCG provided to Legal Division 

personnel.

As a result of these initiatives, the FDIC made 21 referrals to MWOLFs, which accounted for 

almost 7 percent of all legal referrals. The FDIC paid more than $960,000 in legal fees to 

MWOLFs and paid more than $4.9 million to diverse attorneys. Although the Legal Division 

does not pay diverse attorneys directly, they are credited with the amount they bill on behalf 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 91 

of their firms. Taken together, the FDIC paid more than $5.9 million to MWOLFs and diverse 

attorneys out of more than $24.3 million spent on outside counsel services. This represents an 

aggregate 24 percent diversity participation rate in outside legal contracting.

HISTORICALLY BLACK COLLEGES AND UNIVERSITIES ENGAGEMENT

In 2023, the FDIC continued to implement a plan for outreach to HBCUs and their students 

focused on three long-term goals: 1) develop and promote free, high-quality financial 

education to strengthen consumer financial capability and sustainable banking relationships; 

2) inform HBCU students and graduates about career opportunities within the FDIC’s 

workforce, including paid internships and leadership positions; and 3) build and strengthen 

positive connections between insured financial institutions and HBCUs. 

The Consumer and Community Affairs Section of DCP strengthened its connections with 

HBCUs through in-person events on HBCU campuses and webinars. Through these events, 

the FDIC promoted homeownership opportunities, financial education, and economic 

development. Several events provided a forum for HBCU students and administrators to 

engage with financial institutions and featured presentations by HBCU officials.

The FDIC regularly engaged 

with HBCU students at career 

and recruitment fairs hosted 

by individual HBCUs. Also, to 

highlight economics career 

pathways, the FDIC hosted a 

Careers and Networking Event 

for students in the American 

Economic Association Summer 

Program held at Howard 

University. 

Attendees included students 

from Howard University, North 

Carolina Agricultural & Technical 

State University, and Spelman College. A panel of FDIC leaders shared insights on the mission 

of their respective economics-related section, available career opportunities, and desirable 

skills. A networking lunch provided a forum for students to engage with FDIC personnel who 

are in the early stages of their careers.

FDIC participation in the 2023 National HBCU Week Conference addressed all three of the 

agency’s HBCU outreach goals. A Money Smart exhibit highlighted the newly updated Money 

Smart for Young Adults curriculum for ages 16-24, the How Money Smart Are You? suite of 14 

online interactive financial capability games, and other resources. HBCU representatives were 

able to request a special organization account to use for their financial education initiatives at 

no charge. The FDIC also participated in the 2023 National HBCU Week Conference Career and 

Recruitment Fair, where HBCU students and alumni engaged with recruiters.

Aerial view of Howard University
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 92 

At the HBCU conference, the FDIC convened a panel with the directors of the Offices of 

Minority and Women Inclusion of several agencies and a Small Business Administration 

official. The panel presented information to entrepreneurs about doing business with the 

agencies and discussed ways to highlight company capabilities and successfully compete for 

agency contracts. In addition, agency personnel provided one-on-one technical assistance 

and shared practical information with the entrepreneurs.

Information Technology Modernization

Information Technology is an essential component in virtually all FDIC business processes. The 

integration of IT and business processes provides opportunities for efficiencies and requires 

both an awareness and mitigation of potential risks. 

MIGRATION TO THE CLOUD 

In 2023, the FDIC made progress on its Cloud Infrastructure Migration project, which is 

composed of Cloud Setup, Back-Up Data Center (BDC) Phase Out, Cloud Data Management 

and Analytics (CDMA), and Data Orchestration and Integration for Applications (DOIA). 

Cloud Set-up 

The Cloud Platform project is comprised of the foundational components that will deliver both 

infrastructure and application services, and will support the migration of the BDC applications 

to the cloud. The Platform team is responsible for creating the cloud platform, while the BDC 

Phase Out teams are responsible for onboarding critical applications onto the cloud platform. 

In tandem with the DOIA and CDMA teams, the cloud Platform/BDC Phase Out projects will 

deliver the foundational components to better support 

the computing, services, and business needs of the FDIC. 

During 2023, the Chief Information Officer Organization 

(CIOO) developed a Database Platform Licensing Strategy 

white paper to outline a cost savings approach and 

alternative cloud technologies. The CIOO conducted 

a Cloud Infrastructure Migration project strategy 

workshop to redefine the program’s overall strategy, 

vision, objectives, scope, and outcomes and identify four strategic work streams: Program 

Governance, Outreach and Adoption, Capability and Capacity Building, and Onboarding and 

Operations. 

Back-Up Data Center Phase Out 

The BDC provides failover/back-up capabilities for the IT assets required to support the 

FDIC Primary Mission Essential Function (PMEF) responsibilities. The primary goal of the 

phase-out program is to remove the dependency of on-premises infrastructure that host 

the PMEF applications. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 93 

During 2023, the FDIC successfully demonstrated that mission-essential and mission-critical 

services remained available on Azure platforms during failover activities. A full test of the 

FDIC’s Business Continuity and Disaster Recovery capabilities was conducted in October, one 

result of which was to strengthen the back-up plan to recover systems, infrastructure, and 

data after a potential catastrophic event. Some applications reduced failover/failback activity 

from 12 hours to 1 hour. Additionally, a policy was developed and successfully implemented 

to shut down non-production servers after hours and weekends, resulting in material cost 

savings.

Cloud Data Management and Analytics 

The CDMA Program will establish a strategic, enterprise data management and data analytic 

capability for the FDIC with secure, modern, data technologies in the cloud. CDMA is a 

comprehensive, multi-year program led by the 

FDIC’s Chief Data Officer Staff, and includes services 

that span Data Strategy, Cloud Technology, Modern 

Data Architecture, Innovation to Production, Data 

Governance, Education Coordination, and FDIC 

Business Division Partnership. 

In 2023, the CIOO completed the initial design, 

architecture, and development of the new Machine 

Learning (ML) and Natural Language Processing 

(NLP) capability in the CDMA Enterprise Data Lake Capability Development environment. With 

the use of CDMA, FDIC Divisions and Offices data management and data analytics information 

was migrated to enable them to create new business capabilities that will improve FDIC data 

and mission delivery decisions.

Data Orchestration and Integration for Application 

DOIA provides engineering support to the Cloud Infrastructure Migration project and other 

efforts involving migrating applications, data, and workloads to the cloud. It also involves 

mitigating dependencies for on-premises infrastructure, and developing modern processes to 

manage data throughout the organization. In 2023, DOIA continued to support the movement 

of data and applications to the cloud, which resulted in easy access to data and advanced data 

analysis of Mission Essential/Mission Critical (ME/MC) applications. CIOO continues to work 

with the Divisions and Offices to modernize data analytic platforms.

MODERNIZING OBSOLETE SYSTEMS

In 2023, the FDIC published its 2027 Target State Architecture to strengthen the resilience of

its IT infrastructure through intelligent automation and use of cloud-smart technologies, 

proactively reducing the risk of cyber-attacks against the FDIC IT infrastructure, increasing 

staff access to the corporate data, and delivering new/modernized capabilities with speed 

and scale. 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 94 

To meet the demands of an ever-evolving regulatory environment, the FDIC envisions 

operationalizing an Adaptive IT Architecture that can be redesigned by the business lines 

to meet changing needs. This year, comprehensive multi-year business roadmaps were 

compiled to facilitate effective IT investment decisions by identifying strategic objectives 

with high impact for appropriately prioritizing the use of limited IT resources. An analysis 

of the complete application portfolio was also initiated to identify the need to retire or 

replace legacy and unsupported technology platforms. In addition, the FDIC established a 

standardized framework and guidance to streamline development and implementation of 

custom web-based applications which will reduce the number of supported infrastructure 

configurations.

RMS Business Process Modernization (BPM)

RMS BPM is a program whose goal is to provide RMS users and external stakeholders with a 

streamlined solution that will focus on delivering automated, end-to-end supervision business 

processes using a cloud-based, business process management platform. The planned solution 

will improve the efficiency and effectiveness of RMS supervision programs by delivering a 

single cloud-based solution that captures end-to-end business processes, improves data 

quality and security, improves internal and external information sharing, and facilitates 

greater use of AI/ML. In 2023, the FDIC completed its effort to define the business, technical, 

and compliance requirements for this project, and to procure funding. CIOO and RMS will 

continue to work together to begin development in 2024.

Enhancing Data Governance 

In 2023, the FDIC established its cloud-based Enterprise Data Lake Capability, which serves as 

the foundation for modernizing enterprise data management and data-driven mission delivery

using new cloud-based advanced data analytics capabilities. The FDIC’s Enterprise Data 

Lake Capability establishes cloud-based capabilities that enable its data to be managed and 

used as an enterprise resource. The Enterprise Data Lake Capability also provides advanced 

self-service data analytics to support modernizing data-based decision making and improve 

mission delivery.

Also in 2023, the FDIC’s Failed Bank Data System developed and deployed new technologies 

and capabilities to support the resolution of three large complex financial institutions. 

The program expanded the current FDIC boundary to incorporate a Government Cloud 

Component, enabling increased scalability options, particularly for hardware and both longterm and short-term storage. In addition, it supported FDIC Legal with over 300 cases and 

subpoenas related to open bank matters and receiverships.

In addition, the FDIC advanced its artificial intelligence program in 2023. Specifically, it 

established an AI Use Case Inventory (as required by the National Defense Authorization Act 

of 2023) as a central repository for FDIC AI use cases to provide visibility on AI activities across 

the Corporation. In response to evolving technology, the FDIC established a cross-functional 

Generative AI Working Group to evaluate Generative AI benefits and risks as an integral part 

of the FDIC AI Governance framework. The program also published the FDIC NIST AI Risk 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 95 

Management Framework (RMF) Evaluation with recommendations on managing AI risks, 

collaborating with more than 20 volunteers across FDIC Divisions and Offices to perform 

evaluations and identify recommendations that can help the FDIC manage AI risks.

Adoption of Agile Software Development 

The FDIC subscribes to “agile” practices when it comes to software development, which 

involves an ongoing process of continuous software code releases and customer feedback. 

In 2023, the CIOO made significant progress to adopt agile software development methods, 

including the formation of the Agile Working Group (AWG) whose goal is to accelerate the 

movement from projects to products. The AWG identified key incremental and iterative steps 

(change management, process, development experience, metrics, and product management) 

to aid in product completion. In addition, the AWG has made substantial progress in training 

leadership and staff, communicating change, establishing key metrics, identifying areas of 

opportunity, and highlighting successes. 

Also in 2023, the CIOO conducted its first Product Management Workshop to educate agile 

teams on the future adoption of a product model18; three of these teams were successful in 

moving to the product model. Starting in 2024, two of the Agile teams’ products will be piloted 

using the product management model. CIOO plans to onboard additional teams depending on 

agile maturity and team stability. CIOO is also creating of a product management playbook, 

which will allow agile teams to reference their journey from project to product management.

DEVSECOPS: Integration of Security Throughout Development Lifecycle 

The FDIC’s DevSecOps initiative is focused on providing product teams with a development 

platform that allows them to quickly implement enhancements; to support small, frequent 

releases; to minimize defects; and to quickly resolve any issues in the production environment. 

Successful milestones were achieved when the source code tool was implemented on the 

FDIC’s Azure Cloud Computing Platform. Along with this, the tool the FDIC uses to curate, 

secure, and deliver software code was migrated to Azure. The application which proactively 

scans the software code for vulnerabilities was deployed to production at the same time. 

The migration to these tools and applications has allowed several teams to have projects in 

the FDIC’s cloud-based service for software development and version control platform. In 

addition, a native DevSecOps tool for Salesforce platform to manage releases and deployment 

was migrated and deployed.

INFORMATION TECHNOLOGY SECURITY

Zero Trust 

Zero Trust is an IT security model that requires identity verification for every person and 

device trying to access resources on a private network, regardless of whether they are sitting 

within or outside of the network perimeter. It provides security against ransomware and 

cybersecurity threats, and all federal agencies are required to adopt a Zero Trust Architecture 

18 A Product Model is a foundational organizing framework to align the technology team with business strategy and 

objectives.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 96 

per Executive Order.19 In 2023, FDIC achieved significant milestones in the adoption of Zero 

Trust principles to safeguard its operations and the critical data it manages. By advancing 

foundational Zero Trust capabilities, the FDIC continues to improve its enterprise security 

posture and enhance process and capabilities to provide secure and accurate data access. 

Identity, Credential, and Access Management (ICAM)

In 2023, the FDIC made advancements in ICAM technologies that contributed to our success in 

adopting Zero Trust principles. Our progress with respect to ICAM technologies will enable the 

FDIC to have a comprehensive view of all users, centralize the verification of user identities, 

and provide expanded identity proofing for business entities and public users. These 

technologies will help reduce burden on the FDIC to manage identities and credentials, 

allow quick detection of irregular behavior, and provide public users a secure way to access 

FDIC systems.

International Outreach

The FDIC takes a leadership role in supporting the global development of deposit insurance, 

bank supervision, and bank resolution systems. In 2023, this included working closely with 

regulatory and supervisory authorities from around 

the world, as well as international standard-setting 

bodies and multilateral organizations, such as the 

International Association of Deposit Insurers (IADI), 

the Association of Supervisors of Banks of the 

Americas (ASBA), the Basel Committee on Banking 

Supervision (BCBS), the Financial Stability Board 

(FSB), the International Monetary Fund (IMF), and 

the World Bank. The FDIC engaged with foreign 

regulatory counterparts by hosting foreign officials, 

conducting training seminars, delivering technical assistance, and fulfilling the commitments 

of FDIC membership in international organizations. The FDIC also advanced policy objectives 

with key jurisdictions by participating in high-level interagency dialogues.

International Association of Deposit Insurers

The FDIC continued its leadership at IADI in 2023. FDIC officials and experts continued to 

support IADI programs, including reviewing and providing input on the Core Principles 

for Effective Deposit Insurance Systems (Core Principles). The FDIC serves as a member of 

IADI’s Executive Council, Core Principles and Research Council Committee, Reimbursement 

Technical Committee, and the Regional Committee of North America. Additionally, the FDIC 

chairs the Training and Technical Assistance Council Committee and the Capacity Building 

Technical Committee.

19 In May of 2021, the President issued Executive Order (EO) 14028, Improving the Nation’s Cybersecurity, initiating 

a sweeping Government-wide effort to ensure that baseline security practices are in place, to migrate the Federal 

Government to a Zero Trust architecture, and to realize the security benefits of cloud-based infrastructure while 

mitigating associated risks.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 97 

During the year, the FDIC contributed to IADI’s second thematic review – a high-level view of 

the membership’s self-reported compliance with four of the 16 Core Principles. The Capacity 

Building Technical Committee provided support for developing and facilitating virtual and inperson workshops for the Africa, Asia-Pacific, Caribbean, European, Eurasian, Latin American, 

and North American regions of IADI, among other activities. With FDIC support, IADI technical 

assistance and training activities reached more than 1,298 participants.

During 2023, the FDIC supported IADI’s Governance Working Group, which realigned IADI’s 

structure. Additionally, the FDIC participated in a joint IADI – FSB Resolution Steering Group 

(ReSG) meeting. Finally, FDIC Chairman Gruenberg provided a keynote speech at the IADI 

Annual Conference in September in Boston, MA.

Association of Supervisors of Banks of the Americas

The FDIC continues to support ASBA’s mission to promote sound banking supervision and 

financial stability by actively supporting ASBA’s leadership and contributing to its training 

and research programs. Committed to strengthening ASBA’s leadership, in 2023 the FDIC 

was represented on ASBA’s board of directors with the FDIC Director of International Affairs 

beginning a two-year term as the North America Director. The FDIC also serves on the Training 

Committee and Working Groups on Financial Technology and climate-related financial risk.

Basel Committee on Banking Supervision

The FDIC supports and contributes to the development of international standards, guidelines, 

and sound practices for prudential regulation and supervision of banks through its 

longstanding membership in the BCBS. The FDIC’s contributions include actively participating 

in many of the committee groups, working groups, and task forces established by the BCBS 

to carry out its work, which focuses on policy development, supervision and implementation, 

accounting, and consultation. Particular areas of focus are capital policy, accounting, 

operational risk, stress testing, and anti-money laundering.

International Deposit Insurance and Resolution Capacity Building

The FDIC’s direct assistance programs to enhance global understanding of best practices in 

deposit insurance, bank supervision, and bank resolution were provided both virtually and 

in person during the year. In 2023, FDIC officials and staff were able to share their expertise 

with more than 325 individuals, representing more than 60 jurisdictions. The FDIC provided 

technical assistance to multiple ASBA members through virtual courses on Operational Risk 

and Model Risk and an in-person course on Banking Crisis and Resolution.

Outreach included hosting two virtual training programs, Virtual FDIC 101, which provides a 

high-level overview of the Corporation’s key activities as a bank supervisor, deposit insurer, 

and resolution authority for 150 participants representing 57 organizations and a new 

program on Setting a Deposit Insurance Fund Target for 25 participants representing 

25 jurisdictions.
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 98 

Effective Management of Strategic Resources

The FDIC must effectively manage its human, financial, and technological resources to 

successfully carry out its mission and meet the performance goals and targets set forth in its 

annual performance plan. The FDIC must align these strategic resources with its mission and 

goals and deploy them where they are most needed to enhance its operational effectiveness 

and minimize potential financial risks to the DIF.

HUMAN CAPITAL MANAGEMENT

The FDIC’s human capital management programs are designed to attract, develop, reward, 

and retain a highly skilled, diverse workforce. In 2023, the FDIC’s workforce planning initiatives 

emphasized the need for enhanced succession management strategies to reduce the risk of 

vacancies in key positions and ensure the Corporation has a talent pipeline with the capability 

to successfully deliver the FDIC’s mission today and into the future.

STRATEGIC WORKFORCE AND SUCCESSION MANAGEMENT

The FDIC faces a steady stream of projected retirements over the next five to ten years. In 

addition, the banking industry is experiencing rapid and significant change, which impacts 

the knowledge and skills needed within the FDIC’s future workforce. The FDIC is proactively 

preparing for these shifts in talent requirements. The FDIC understands that effective strategic 

workforce and succession planning are critical to ensure that gaps in employee aspiration, 

engagement, and readiness for senior leadership and technical positions are identified 

and addressed.

In 2023, the FDIC formally established a Human Capital Strategic Planning and Analysis unit 

within the Division of Administration with dedicated resources to identify a Corporate-wide, 

sustainable approach to address its talent pipeline challenges. The FDIC has re-confirmed 

its leadership competencies and has begun to develop content for leadership role profiles 

that will provide the basis for selection, assessment, and development of the talent pipeline, 

aligned with the Corporation’s strategic direction. This initiative will produce robust career 

paths that illustrate options for job movement within the FDIC and developmental options 

to be competitive for different positions, which will create more transparency and empower 

employees to effectively plan their career development. Over time, the enhancements to

assessments, development, and selection processes will result in more qualified candidates 

in our talent pools and more objective hiring practices for leadership positions. This effort will 

help the Corporation develop and maintain a talent pipeline with the skills, experience, and 

motivation to lead.

The FDIC also implemented a corporate-wide Career Aspirations Survey to understand 

employees’ aspiration levels and the factors that influence their pursuit of leadership roles. 

The results are being used to inform additional succession strategies. To gain insights into 

retention issues, the FDIC implemented a new Corporate Exit Survey and also developed a 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 99 

retention management dashboard that provides enhanced analyses of workforce data. The 

FDIC’s data-driven, research-based approach to succession management will give leaders a 

more accurate understanding of strengths and weaknesses in the talent pool.

Through these efforts, the FDIC workforce will be even better positioned to respond to 

dynamic financial and technological challenges, now and in the future.

EMPLOYEE LEARNING AND DEVELOPMENT

The FDIC has a robust program to train and develop its employees throughout their careers 

to enhance technical proficiency and leadership capacity, supporting career progression 

and succession management. In 2023, the FDIC leveraged its modernized training center and 

learning management system to fully support the return to in-person classroom training and 

an increase in examiner hiring.

The FDIC develops and implements comprehensive curricula for its business lines to prepare 

employees to meet new challenges. Employees working to become commissioned examiners 

or resolutions and receiverships specialists attend 

a prescribed set of specialized, internally developed 

and instructed courses. Post-commission, employees 

continue to further their knowledge in specialty areas 

with more advanced courses. The FDIC is revising 

examiner classroom training to better support 

an on-the-job application and has developed a 

wide-ranging resolution and receivership training 

curriculum to support readiness.

The FDIC also offers a comprehensive leadership development program that combines core 

courses, electives, and other enrichment opportunities to develop employees at all levels, 

and support succession planning and diversity, equity, inclusion, and accessibility goals. From 

new employees to new executives, the FDIC provides employees with targeted opportunities 

that align with key leadership competencies. In addition to offering a broad array of internally 

developed and administered courses, the FDIC provides its employees with funds to 

participate in external training to support their career development.

In 2023, the FDIC’s Corporate University delivered nearly 140 in-person course offerings to 

more than 2,700 participants, as well as more than 155 virtual course offerings to more than 

8,000 participants.

EMPLOYEE ENGAGEMENT

Employee engagement plays an important role in empowering employees and helps maintain, 

enhance, and institutionalize a positive workplace environment. The FDIC strives to be an 

employer of choice, and continually evaluates its human capital programs and strategies to 

ensure that all of its employees are fully engaged and aligned with the mission. The FDIC uses 
MANAGEMENT’S DISCUSSION AND ANALYSIS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 100 

the Federal Employee Viewpoint Survey mandated 

by Congress to solicit feedback from employees, 

and takes an agency-wide approach to address key 

issues identified in the survey. 

The FDIC engages employees through the Workplace 

Excellence (WE) Program and other formal channels 

such as the Chairman’s Diversity Advisory Councils 

and Employee Resource Groups; and informally 

through working groups, team discussions, 

listening sessions, and daily employee-supervisor interactions. In addition, the FDIC-National 

Treasury Employees Union (NTEU) Labor Management Forum (LMF) serves as a mechanism 

for the union and employees to have pre-decisional input on workplace matters. WE and LMF 

enhance communication, provide additional opportunities for employee input, and improve 

employee engagement. 
II.

PERFORMANCE RESULTS

SUMMARY
PAGE INTENTIONALLY LEFT BLANK
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 103 

Insurance Program Results

Strategic Goal: Insured deposits are protected from loss without recourse to taxpayer funding.

ANNUAL PERFORMANCE 

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

1. Respond promptly to all IDI failures and related emerging issues.

Depositors have access to 

insured funds within one 

business day if the failure 

occurs on a Friday.

ACHIEVED.

SEE PG. 80.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES.

ACHIEVED. ACHIEVED. N/A – NO 

FAILURES.

Depositors have access to 

insured funds within two 

business days if the failure 

occurs on any other day of 

the week. 

ACHIEVED.

SEE PG. 80.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES.

N/A – ALL 

FAILURES 

ON 

FRIDAYS.

ACHIEVED. N/A – NO 

FAILURES.

Depositors do not incur any 

losses on insured deposits. 

ACHIEVED.

SEE PG. 80.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES.

ACHIEVED. ACHIEVED. N/A – NO 

FAILURES.

No appropriated funds are 

required to pay insured 

depositors. 

ACHIEVED.

SEE PG. 80.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES.

ACHIEVED ACHIEVED. N/A – NO 

FAILURES.

Performance Results by Program and Strategic Goal

The Annual Performance Goals and Targets shown in the table below reflect the 2023 version. The 

language in prior years’ reports might be slightly different for the same goals and targets. Refer to the 

respective full Annual Report of prior years, located on the FDIC’s website for more information on 

performance results for those years. Shaded areas indicate no such performance target existed for 

that respective year.

Summary of 2023 Performance Results by Program

The FDIC successfully achieved 50 of the 54 annual performance targets established in its 2023 Annual 

Performance Plan. Two targets were substantially achieved, one target was not achieved, and one 

target was not applicable for 2023. There were no instances in which 2023 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.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 104 

Insurance Program Results (continued)

Strategic Goal: Insured deposits are protected from loss without recourse to taxpayer funding.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

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.

Disseminate results of research 

and analyses in a timely manner 

through regular publications, ad 

hoc reports, and other means. 

ACHIEVED.

SEE PGS. 

51-53.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Undertake industry outreach 

activities, as needed, to inform 

bankers and other stakeholders 

about current trends, concerns, 

available resources, and FDIC 

performance metrics. 

ACHIEVED.

SEE PGS. 

51-54.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

3. Monitor the status of the DIF reserve ratio and analyze the factors that affect fund growth. Adjust 

assessment rates, as necessary, to achieve a DIF reserve ratio of at least 1.35 percent of estimated insured 

deposits by September 30, 2028.

Provide updated fund balance 

projections to the FDIC Board of 

Directors semiannually. 

ACHIEVED.

SEE PGS. 

28-30.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Recommend changes to deposit 

insurance assessment rates to 

the FDIC Board of Directors, as 

necessary. 

ACHIEVED.

SEE PGS. 

28-30.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Issue for comment by May 

2023 a Notice of Proposed 

Rulemaking to implement a 

special assessment on insured 

institutions to recover the costs 

incurred by the DIF due to 

the systemic risk exception to 

protect uninsured deposits in 

banks that failed in early 2023. 

ACHIEVED.

SEE PG. 29.

Provide progress reports to 

the FDIC Board of Directors 

semiannually, in accordance 

with the Restoration Plan. 

ACHIEVED.

SEE PGS. 

29-30.

ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 105 

Insurance Program Results (continued)

Strategic Goal: Insured deposits are protected from loss without recourse to taxpayer funding.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Complete a comprehensive 

review of the deposit insurance 

system and release by May 1, 

2023, a report that identifies 

policy options for consideration 

related to deposit insurance 

coverage levels, excess deposit 

insurance, and the implications 

for risk based pricing and 

deposit insurance fund 

adequacy.

ACHIEVED.

SEE PG. 30.

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, 2018, and 

December 31, 2018.

ACHIEVED.

Provide progress reports to 

the FDIC Board of Directors 

by June 30, 2018, and 

December 31, 2018.

ACHIEVED.

Recommend changes to deposit 

insurance assessment rates to 

the FDIC Board of Directors as 

necessary.

ACHIEVED.

5. Expand and strengthen the FDIC’s participation and leadership role in supporting robust and effective

deposit insurance programs, resolution strategies, and banking systems worldwide.

Foster strong relationships with 

international banking regulators, 

deposit insurers, and other 

relevant authorities by engaging 

with strategically important 

jurisdictions and organizations 

on international financial safety 

net issues. 

ACHIEVED.

SEE PGS. 

96-97.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 106 

Insurance Program Results (continued)

Strategic Goal: Insured deposits are protected from loss without recourse to taxpayer funding.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Provide leadership and 

expertise to key international 

organizations and associations 

that promote sound deposit 

insurance and effective bank 

supervision and resolution 

practices. 

ACHIEVED.

SEE PGS. 

96-97.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Promote international standards 

and expertise in financial 

regulatory practices and 

stability through the provision of 

technical assistance and training 

to global financial system 

authorities. 

ACHIEVED.

SEE PGS. 

96-97.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

6. Ensure timely consideration and efficient processing of de novo deposit insurance applications.

Provide feedback on 75 percent 

of draft community bank 

deposit insurance applications 

no later than 60 days after 

receipt to facilitate the 

ultimate submission of a 

formal application. 

ACHIEVED.

SEE PG. 56.

NOT

ACHIEVED.

NOT

ACHIEVED.

NOT

ACHIEVED.

Conduct six regional roundtable 

discussions to explain and 

solicit feedback on the de 

novo application process, and 

implement additional changes, 

as appropriate, based on 

that feedback.

ACHIEVED.

Ensure the de novo deposit 

insurance application process is 

streamlined and transparent.

ACHIEVED.

7. Market failing IDIs to a targeted pool of qualified and interested potential bidders.

Contact a targeted pool of 

qualified and interested bidders. 

ACHIEVED.

SEE PG. 80.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES. ACHIEVED. ACHIEVED. N/A – NO 

FAILURES.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 107 

Insurance Program Results (continued)

Strategic Goal: Insured deposits are protected from loss without recourse to taxpayer funding.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

8. Provide educational information to IDIs 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.

SEE PG. 79. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Conduct at least four virtual or 

in-person seminars for bankers 

on deposit insurance coverage. 

ACHIEVED.

SEE PGS. 

56-57.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 108 

Supervision Program Results

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE 

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

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 determine whether identified problems are corrected and take other actions 

as appropriate.

Conduct all required risk 

management examinations 

within the timeframes 

prescribed by statute and 

FDIC policy. 

ACHIEVED.

SEE PG. 32.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

For at least 90 percent of IDIs 

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 determine 

whether all MRBAs are being 

addressed. 

ACHIEVED.

SEE PG. 33.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Complete by May 1, 2023, a 

comprehensive review of the 

FDIC’s supervision of Signature 

Bank prior to its failure. Evaluate 

and take appropriate actions 

in response to the matters 

identified for further study.

ACHIEVED.

SEE PGS. 

81-82.

2. Assist in protecting the infrastructure of the U.S. banking system against terrorist financing, money 

laundering, and other financial crimes.

Conduct all AML/CFT 

examinations within the 

timeframes prescribed by 

statute and FDIC policy. 

ACHIEVED.

SEE PGS. 

31-32.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 109 

Supervision Program Results (continued)

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

3. Establish regulatory capital standards that require institutions to have sufficient loss-absorbing capacity 

to remain resilient under stress while reducing complexity and maximizing efficiency.

Issue a Notice of Proposed 

Rulemaking (NPR) to implement 

the final Basel III standards to 

strengthen capital requirements 

applicable to large banks into 

the U.S. regulatory capital 

framework. 

ACHIEVED.

SEE PG. 46.

NOT

ACHIEVED.

NOT

ACHIEVED.

NOT

ACHIEVED.

Issue an interagency final rule on 

holdings of total loss- absorbing 

capacity.

ACHIEVED.

Issue a final rule to implement 

the Net Stable Funding Ratio 

(NSFR).

ACHIEVED. NOT

ACHIEVED.

Complete, by September 

30, 2019, rulemaking for a 

community bank leverage ratio 

and conforming changes to the 

deposit insurance assessment 

process.

ACHIEVED.

Finalize aspects of the 

interagency capital 

simplification proposal issued 

in September 2017, including 

changes to the regulatory 

capital treatment of mortgage 

servicing assets, deferred tax 

assets, investment in the capital 

instruments of other financial 

institutions, and minority 

interest.

ACHIEVED.

Issue interagency final rules to 

adopt the statutory definition of 

high volatility commercial real 

estate for risk-based capital.

ACHIEVED.

Reevaluate and take appropriate 

actions on Basel III requirements 

for small banks that do not 

meet or are not eligible for the 

community bank leverage ratio.

ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 110 

Supervision Program Results (continued)

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Issue interagency final rules to 

tailor capital requirements for 

large financial institutions.

ACHIEVED.

Issue interagency rulemaking 

to remove certain central bank 

deposits from the denominator 

of the supplementary leverage 

ratio for custodial banks.

ACHIEVED.

4. Ensure that regulatory capital standards promote banks’ resilience under stress and the confidence of 

their counterparties.

Finalize a Notice of Proposed 

Rulemaking (NPR) for a 

simplified risk-based capital 

framework for community 

banks.

NOT

ACHIEVED.

Finalize the Basel III Net Stable 

Funding Ratio (NSFR).

NOT

ACHIEVED.

5. Implement strategies to promote enhanced cybersecurity and business continuity within the banking 

industry.

Continue to conduct horizontal 

reviews that focus on the IT risks 

in large, complex institutions 

and service providers. 

ACHIEVED.

SEE PGS. 

35-36 & 

58-59.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Continue to conduct service 

provider examinations using 

the Cybersecurity Examination 

Program. 

ACHIEVED.

SEE PGS. 

35-36.

ACHIEVED.

Conduct IT examinations as 

part of every FDIC safety and 

soundness examination of 

FDIC-insured institutions. 

ACHIEVED.

SEE PGS. 

35-36.

Amplify cybersecurity threat 

information as needed. 

ACHIEVED.

SEE PGS. 

35-36.

Strengthen administration of the 

IT examination program. 

ACHIEVED.

SEE PGS. 

35-36.

Implement a computer security 

incident notification final rule. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 111 

Supervision Program Results (continued)

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Continue to use the 

Cybersecurity Examination 

Program for service provider 

examinations, including the 

most significant service provider 

examinations.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Improve the analysis and 

sharing of cybersecurity-related 

threat information with financial 

institutions.

ACHIEVED. ACHIEVED.

6. Update rules, regulations, and other guidance to promote the safety and soundness of the financial 

system.

Review and, as appropriate, 

amend the FDIC’s regulations, 

Statement of Policy, and internal 

procedures related to financial 

institution mergers. 

NOT 

ACHIEVED.

SEE PG. 48.

SUBSTANTIALLY

ACHIEVED.

Finalize principles for large 

institutions and continue to 

engage with industry and other 

stakeholders on consideration 

of appropriate guidance to help 

banks prudently manage the 

financial risks posed by climate 

change. 

ACHIEVED.

SEE PGS. 

48-49.

ACHIEVED.

Issue statements and take 

other actions, as appropriate, 

regarding crypto asset-related 

activities. 

ACHIEVED.

SEE PGS. 

50-51.

ACHIEVED.

Continue efforts related to 

rulemaking on Suspicious 

Activity Report (SAR) 

requirements. 

ACHIEVED.

SEE PG. 45. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 112 

Supervision Program Results (continued)

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Based on lessons learned 

from the bank failures in early 

2023, and in coordination 

with the OCC and FRB, review 

the prudential regulation of 

regional banks with respect to 

capital, liquidity, and interest 

rate risk (including the capital 

treatment of unrealized losses) 

and consider whether changes 

or updated guidance are 

appropriate. 

ACHIEVED.

SEE PGS. 

41-43.

Solicit public comment on the 

development of guidance to 

help banks prudently manage 

the financial risks posed by 

climate change.

ACHIEVED.

Issue a final rule related to 

the exemption for Suspicious 

Activity Reports (SARs).

NOT

ACHIEVED.

Issue a final interagency rule on 

the use of supervisory guidance.

ACHIEVED.

Clarify the use of Model Risk 

Management Guidance related 

to systems or models used by 

banks to assist in complying 

with the BSA/AML requirements.

ACHIEVED.

Issue a final rule on 

brokered deposits.

ACHIEVED.

Issue a final rule on stress 

testing guidance.

NOT

ACHIEVED.

Issue a final rule to codify and 

amend the FDIC’s Statement 

of Policy on Section 19 of the 

Federal Deposit Insurance Act 

(FDI Act).

ACHIEVED.

Issue a final rule clarifying the 

applicability of the “valid when 

made” rule.

ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 113 

Supervision Program Results (continued)

Strategic Goal: FDIC-insured institutions are safe and sound.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Issue an interagency final rule to 

modify the treatment of covered 

funds under the Volcker Rule.

ACHIEVED.

Issue a final rule amending the 

swap margin requirements.

ACHIEVED.

7. Increase engagement and collaboration to preserve and promote FDIC-insured minority depository 

institutions (MDIs) and mission-driven institutions.

Convene meetings of the MDI 

Subcommittee of the Advisory 

Committee on Community 

Banking (CBAC) to gain insight 

into industry needs, seek input 

on program operations, and 

share best practices. 

ACHIEVED.

SEE PGS. 

85-86.

ACHIEVED. ACHIEVED.

Host an interagency conference 

for FDIC-insured MDIs and 

Community Development 

Financial Institutions. 

ACHIEVED.

SEE PG. 86.

Promote creation of new MDIs. 

ACHIEVED.

SEE PGS. 

85-88.

ACHIEVED. ACHIEVED.

Establish the Mission-Driven 

Bank Fund as an independent 

funding source for FDICinsured MDIs and Community 

Development Financial 

Institutions (CDFIs).

ACHIEVED.

Conduct a media campaign 

to promote the visibility and 

benefit of FDIC-insured MDIs 

and other mission-driven 

institutions.

ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 114 

Supervision Program Results (continued)

Strategic Goal: FDIC-supervised institutions are compliant with federal consumer protection laws, including fair 

lending laws, and the Community Reinvestment Act (CRA).

ANNUAL PERFORMANCE 

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

1. Conduct on-site CRA and consumer compliance examinations to assess compliance with applicable laws 

and regulations by FDIC-supervised institutions. When violations are identified, promptly implement 

appropriate corrective programs/actions and follow up until the violations are fully corrected.

Conduct all required 

examinations within the 

timeframes established. 

ACHIEVED.

SEE PGS. 

37-38.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

SUBSTANTIALLY 

ACHIEVED.

Conduct visits and/or follow-up 

examinations in accordance 

with established FDIC processes 

and timeframes to determine 

whether institutions have 

implemented the requirements 

of any corrective program and 

have fully addressed identified 

violations. 

SUBSTANTIALLY 

ACHIEVED.

SEE PGS. 

37-38.

SUBSTANTIALLY 

ACHIEVED.

ACHIEVED. ACHIEVED. ACHIEVED.

SUBSTANTIALLY 

ACHIEVED.

Publish an interagency final rule 

to modernize and strengthen 

CRA regulations. 

ACHIEVED.

SEE PGS. 

44-45.

ACHIEVED.

2. 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 timeframes 

established by policy, with 

all complaints and inquiries 

receiving at least an initial 

acknowledgment within 

two weeks. 

ACHIEVED.

SEE PG. 77.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Publish on the FDIC’s public 

website (https://www.fdic.gov) 

and regularly update metrics on 

requests from the public for FDIC 

assistance. 

ACHIEVED.

SEE PG. 77.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Publish, through the Consumer 

Response Center (CRC), an 

annual report regarding the 

nature of the FDIC’s interactions 

with consumers and depositors.

ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 115 

Supervision Program Results (continued)

Strategic Goal: FDIC-supervised institutions are compliant with federal consumer protection laws, including fair 

lending laws, and the Community Reinvestment Act (CRA).

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

3. Promote economic inclusion and access to responsible financial services through supervisory, research, 

policy, and consumer/community affairs initiatives.

Conduct the 2023 National 

Survey of Unbanked and 

Underbanked Households. 

ACHIEVED.

SEE PG. 53.

Develop and publish an 

updated, multi-year Economic 

Inclusion Strategic Plan. 

ACHIEVED.

SEE PG. 68.

Complete identification and 

evaluation of outcome-based 

measures that could potentially 

demonstrate the effectiveness 

of economic inclusion strategies 

and initiatives. 

SUBSTANTIALLY

ACHIEVED.

SEE PG. 68.

SUBSTANTIALLY

ACHIEVED.

Publish the results of the 2021 

National Survey of the Unbanked 

and Underbanked Households.

ACHIEVED.

Complete the second phase 

of #GetBanked, a public 

awareness campaign to 

encourage unbanked and 

underbanked individuals to 

establish sustainable banking 

relationships in three additional 

markets.

ACHIEVED.

Identify and begin tracking 

and reporting outcome-based 

measures that demonstrate the 

success of economic inclusion 

strategies to inform future 

programmatic decisions.

SUBSTANTIALLY

ACHIEVED.

Field the 2021 Survey of 

Household Use of Banking and 

Financial Services and begin 

analysis to support publication 

of the report in 2022.

ACHIEVED.

Complete a public awareness 

campaign to encourage 

unbanked individuals to 

establish sustainable banking 

relationships in two markets.

ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 116 

Supervision Program Results (continued)

Strategic Goal: FDIC-supervised institutions are compliant with federal consumer protection laws, including fair 

lending laws, and the Community Reinvestment Act (CRA).

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Issue rules and guidance to 

ensure that FDIC-supervised 

institutions meet the credit 

needs of their communities.

NOT

ACHIEVED.

NOT

ACHIEVED.

Launch How Money Smart Are 

You? an online, interactive 

learning game.

ACHIEVED. NOT

ACHIEVED.

Publish the results of the 2019 

Survey of the Unbanked and 

Underbanked Households.

ACHIEVED. ACHIEVED. ACHIEVED.

Strengthen connections 

between small businesses and 

FDIC-insured institutions.

ACHIEVED. ACHIEVED. ACHIEVED.

Increase engagement and 

collaboration to preserve and 

promote Minority Depository 

Institutions (MDIs).

ACHIEVED. ACHIEVED. ACHIEVED.

Conduct outreach to institutions 

and the public to expand 

the availability and usage of 

low-cost transaction accounts 

tailored to the needs of 

unbanked and underbanked 

households.

ACHIEVED.

Expand the reach of the new 

Money Smart for Adults through 

online resources, translating the 

curriculum into other languages, 

and outreach.

ACHIEVED.

Publish the results of the 

2017 FDIC National Survey of 

Unbanked and Underbanked 

Households.

ACHIEVED.

Complete planning for the 

2019 FDIC National Survey of 

Unbanked and Underbanked 

Households.

ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 117 

Supervision Program Results (continued)

Strategic Goal: FDIC-supervised institutions are compliant with federal consumer protection laws, including fair 

lending laws, and the Community Reinvestment Act (CRA).

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Continue to promote broader 

access to and use of lowcost transaction and savings 

accounts to build banking 

relationships that will meet 

the needs of unbanked and 

underbanked households 

by increasing the current 

level of engagement from 10 

communities to 15 communities.

ACHIEVED.

Launch the revised Money Smart 

for Adults curriculum. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 118 

Supervision Program Results (continued)

Strategic Goal: Large, complex financial institutions are resolvable in an orderly manner.

ANNUAL PERFORMANCE 

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

1. Identify and address risks in LCFIs, including those designated as systemically important.

In collaboration with the FRB, 

begin the review of resolution 

plans submitted in July 2023 

pursuant to Section 165(d) of the 

Dodd-Frank Act for conformance 

to statutory and other regulatory 

requirements, including testing 

certain capabilities the firms 

need in order to successfully 

implement their strategies. 

ACHIEVED.

SEE PGS.

59-60.

ACHIEVED.

SUBSTANTIALLY

ACHIEVED.

ACHIEVED. ACHIEVED. ACHIEVED.

Following up on the joint 

Advance Notice of Proposed 

Rulemaking (ANPR) 

on resolution resource 

requirements for large banks, 

issue an NPR to solicit public 

comment on a requirement 

for LCFIs to issue long-term 

debt to enhance options for 

their resolution in the event of 

financial distress. 

ACHIEVED.

SEE PG. 61.

Continue a review of resolution 

plans submitted pursuant to 

the IDI Rule for conformance to 

regulatory requirements. 

ACHIEVED.

SEE PG. 60.

ACHIEVED.

NOT 

APPLICABLE.

NOT 

APPLICABLE.ACHIEVED. ACHIEVED.

Continue to improve the 

utility of IDI resolution plan 

requirements to the FDIC by 

building on the lessons learned, 

from prior reviews and the three 

large regional bank failures in 

early 2023. 

ACHIEVED.

SEE PGS. 

59-62.

Conduct ongoing risk analysis 

and monitoring of LCFIs to better 

understand and assess their 

structure, business activities, 

risk profiles, and recovery and 

resolution plans. 

ACHIEVED.

SEE PGS. 

57-58.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 119 

Supervision Program Results (continued)

Strategic Goal: Large, complex financial institutions are resolvable in an orderly manner.

ANNUAL PERFORMANCE

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

Publish further information on 

the approach to IDI resolution 

planning.

ACHIEVED.

Issue an NPR and, following a 

review of comments, a final rule 

to tailor and make adjustments 

to the FDIC’s resolution planning 

requirements for IDIs.

NOT

ACHIEVED.

NOT

ACHIEVED.

Complete interagency 

rulemaking with the FRB to 

tailor application of resolution 

planning requirements under 

Section 165(d) of the DoddFrank Act.

ACHIEVED.

Issue an ANPR to tailor and 

make adjustments to the 

FDIC’s resolution planning 

requirements for IDIs.

ACHIEVED.

2. Continue to build the FDIC’s operational readiness to administer the resolution of LCFIs, including those 

designated as systemically important.

Continue to refine plans and 

strategic options to ensure the 

FDIC’s operational readiness to 

administer a resolution of LCFIs.

ACHIEVED.

SEE PGS. 

59-61.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

Continue to deepen 

and strengthen working 

relationships with key 

foreign jurisdictions, both on 

a bilateral basis and through 

multilateral fora. 

ACHIEVED.

SEE PGS. 

63-64.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.
PERFORMANCE RESULTS SUMMARY

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 120 

Receivership Management Program Results

Strategic Goal: Resolutions are orderly and receiverships are managed effectively.

ANNUAL PERFORMANCE 

GOALS AND TARGETS 2023 2022 2021 2020 2019 2018

1. Value, manage, and market assets of failed institutions and their subsidiaries in a timely manner to 

maximize net return.

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, 

120 days of the date for pools 

of similar assets of appropriate 

size to bring to market for joint 

venture, or 180 days for assets 

identified for securitization. 

ACHIEVED.

SEE PG. 83.

N/A – NO 

FAILURES.

N/A – NO 

FAILURES.

ACHIEVED. ACHIEVED. N/A – NO 

FAILURES.

2. Manage the receivership estate and its subsidiaries toward an orderly termination.

Terminate at least 75 percent 

of receiverships that were at 

least two years old and were 

not subject to unresolved lossshare, structured transaction, 

environmental, legal, or tax 

impediments at the start of 

the year. 

ACHIEVED.

SEE PGS. 

83-84.

ACHIEVED. N/A – NO 

FAILURES.* ACHIEVED. ACHIEVED. ACHIEVED.*

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.

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 IDI.

NOT

APPLICABLE.

SEE PGS. 

84-85.

ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED. ACHIEVED.

*This corrects performance results erroneously reported in prior annual reports.
III.

FINANCIAL HIGHLIGHTS
PAGE INTENTIONALLY LEFT BLANK
FINANCIAL HIGHLIGHTS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 123 

In its role as insurer of bank and savings association deposits, the FDIC promotes the public’s 

trust in the safety and soundness of insured depository institutions. The following financial 

highlights address the performance of the Deposit Insurance Fund.

Deposit Insurance Fund Performance

The DIF balance was $121.8 billion at December 31, 2023, a decrease of $6.4 billion from the 

year-end 2022 balance. In 2023, DIF’s comprehensive loss totaled $6.4 billion compared to 

comprehensive income of $5.1 billion in 2022. The year-over-year change of $11.5 billion was 

primarily due to a $41.0 billion increase in provision for insurance losses and a $2.3 billion 

realized loss on sale of U.S. Treasury (UST) securities, partially offset by $24.9 billion increase 

in assessment revenue, a $5.8 billion increase in UST securities market valuation adjustments 

and $1.5 billion increase in interest revenue from UST securities. 

The provision for insurance losses was $41.0 billion for 2023, primarily resulting from 

approximately $40.4 billion in estimated losses for the five failures that occurred in 2023. 

Of the $40.4 billion, $20.4 billion represents estimated losses resulting from the coverage 

of uninsured deposits pursuant to two separate systemic risk determinations for SVB and 

Signature Bank, which by law must be recovered through a special assessment (and not 

charged to the DIF). Hence, the net estimated loss impacting the DIF is $20.0 billion.

Assessment revenue was $33.2 billion for 2023, compared to $8.3 billion for 2022. As noted 

above, the $24.9 billion year-over-year increase was primarily related to the $20.4 billion of 

special assessments associated with the protection of uninsured depositors along with a 

2 basis point increase in assessment rates beginning with the first quarter 2023 insurance 

coverage as mandated by the amended Restoration Plan. 

In 2023, the FDIC sold UST securities for total proceeds of $79.8 billion resulting in a total net 

realized loss of $2.3 billion.

The DIF’s interest revenue on UST securities for 2023 was $2.7 billion, compared to $1.2 billion 

in 2022. The $1.5 billion year-over-year increase resulted from maturities being reinvested in 

higher yielding securities and overnight investment vehicles. 

The DIF’s cash, cash equivalents, and UST investment portfolio balances decreased by 

$101.2 billion during 2023 to $23.8 billion at year-end 202320, from $125.0 billion at year-end 

2022. This decrease was primarily due to disbursements for resolutions of $158.0 billion, 

partially offset by recoveries from resolutions of $43.1 billion and assessment collections of 

$11.7 billion.

20 On January 11, 2024, DIF received approximately $41.5 billion in dividends from the Silicon Valley Bridge Bank, N.A. 

The DIF’s cash and investments balance as of close of business on January 11, 2024 was $65.5 billion.
ESTIMATED DIF INSURED DEPOSITS

FINANCIAL HIGHLIGHTS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 124 

DEPOSIT INSURANCE FUND RESERVE RATIOS

3/31/13

9/30/13

3/31/14

9/30/14

3/31/15

9/30/15

3/31/16

9/30/16

3/31/17

9/30/17

3/31/18

9/30/18

3/31/19

9/30/19

3/31/20

9/30/20

3/31/21

9/30/21

3/31/22

9/30/22

3/31/23

9/30/23

Dollars in Billions

$10,000

$12,000

$8,000

$6,000

$4,000

$2,000

0

3/31/13

9/30/13

3/31/14

9/30/14

3/31/15

9/30/15

3/31/16

9/30/16

3/31/17

9/30/17

3/31/18

9/30/18

3/31/19

9/30/19

3/31/20

9/30/20

3/31/21

9/30/21

3/31/22

9/30/22

3/31/23

9/30/23

Fund Balance as a Percent 

of Estimated Insured Deposits

0.40

0.60

0.80

1.20

1.60

1.40

1.00

0.20

0.0

Reserve Ratio Statutory Minimum Reserve Ratio

Source: Commercial Bank Call and Thrift Financial Reports
FINANCIAL HIGHLIGHTS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 125 

Deposit Insurance Fund Selected Statistics

Dollars in Millions

For the years ended December 31

2023 2022 2021

Financial Results

Revenue $35,996 $9,607 $8,153 

Operating Expenses 2,126 1,883 1,843 

Insurance and Other Expenses 

(includes provision for losses and realized loss 

on sale of investment securities)

43,249 (79) (137)

Net (Loss) Income (9,379) 7,803 6,448

Comprehensive (Loss) Income (6,440) 5,077 5,244 

Insurance Fund Balance $121,778 $128,218 $123,141

Fund as a Percentage of Insured Deposits 

(reserve ratio) 1.13%1 1.25% 1.24%

Selected Statistics

Total DIF-Member Institutions2 4,6141 4,706 4,839

Problem Institutions 441 39 44

Total Assets of Problem Institutions $53,5141 $47,463 $170,172

Institution Failures 5 0 0

Total Assets of Failed Institutions in Year3 $532,228 $0 $0

Number of Active Failed Institution Receiverships 74 132 191

1 As of September 30, 2023.

2 Commercial banks and savings institutions. Does not include U.S. insured branches of foreign banks.

3 Total Assets data are based upon the last Call Report filed by the institution prior to failure.
PAGE INTENTIONALLY LEFT BLANK
IV.

BUDGET AND SPENDING
BUDGET AND SPENDING

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 128 

2023 FDIC Operating Budget

The FDIC segregates its corporate operating budget and expenditures into three separate 

components: ongoing operations, receivership funding, and the Office of Inspector General 

(OIG). The receivership funding component represents expenditures resulting from financial 

institution failures. It is, therefore, largely driven by external forces and is less controllable 

and estimable. FDIC operating expenditures totaled $2.8 billion in 2023, including $2.1 billion 

in ongoing operations, $684 million in receivership funding, and $47 million for the OIG. This 

represented approximately 91 percent of the approved budget for ongoing operations, 83 

percent of the approved budget for receivership funding, and 98 percent of the approved 

budget for the OIG for the year.

The approved 2024 FDIC Operating Budget of approximately $3.0 billion consists of $2.6 billion 

for ongoing operations, $350 million for receivership funding, and $51 million for the OIG. 

The approved ongoing operations budget for 2024 is approximately $275 million (12 percent) 

higher than the 2023 ongoing operations budget, while the approved receivership funding 

budget is approximately $475 million (58 percent) lower than the 2023 receivership funding 

budget. The 2024 OIG budget is $2 million (5 percent) higher than the 2023 OIG budget.

As in prior years, the 2024 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 approved 2024 FDIC Operating Budget is approximately $198 million 

(six percent) lower than the 2023 FDIC Operating Budget. The Receivership Funding budget 

is $475 million (58 percent) lower, while the Ongoing Operations budget is $275 million 

(12 percent) higher due to an increase in authorized staffing in 2024 and scheduled employee 

salary and benefit increases needed to recruit, hire, and retain the diverse pool of highly 

qualified people the agency relies upon to carry out its mission.

FDIC EXPENDITURES

0

500

1000

1500

2000

2500

3000

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Dollars in Millions
BUDGET AND SPENDING

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 129 

2023 BUDGET AND EXPENDITURES BY PROGRAM

Receivership

Management

Program

Insurance

Program

Supervision

and Consumer

Protection 

Program

General and

Administrative

$1,200

$1,500

Budget

$900

$600

$300

$0

Expenditures

The FDIC’s Strategic Plan and Annual Performance Plan provide the basis for annual 

budgeting for needed resources. The original 2023 aggregate budget (for ongoing operations, 

receivership funding, OIG, and investment spending) was $2.4 billion. The budget was 

increased by $750 million in the Receivership component in May 2023 to provide the resources 

necessary to respond to three large regional bank failures. This brought the 2023 budget to 

$3.2 billion, while actual expenditures for the year were $2.8 billion, about $875 million higher 

than 2022 expenditures. 

2023 Budget and Expenditures by Program

(EXCLUDING INVESTMENTS)

The FDIC’s $3.2 billion 2023 corporate operating budget was allocated by program as follows: 

$1.3 billion or 40 percent, to the Supervision and Consumer Protection program; $1.1 billion 

or 35 percent, to the Receivership Management program; $392 million, or 12 percent, to the 

Insurance program; and $407 million, or 13 percent, to Corporate General and Administrative 

expenditures. 

Actual expenditures for the year totaled $2.8 billion. Actual expenditures occurred as 

follows: $1.27 billion, or 46 percent, to the Supervision and Consumer Protection program; 

$930 million, or 33 percent, to the Receivership Management program; $333 million, or 12 

percent, to the Insurance program; and $261 million, or 9 percent, to Corporate General and 

Administrative expenditures.

Dollars in Millions
BUDGET AND SPENDING

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 130 

Investment Spending

The FDIC instituted a separate Investment Budget in 2003 to provide enhanced governance 

of major multi-year 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 agency’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 2014-2023 investment spending totaled $107 million, and is estimated at 

$14 million for 2024.

INVESTMENT SPENDING

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

$25

$15

$5

$10

$20

$0

Dollars in Millions
V.

FINANCIAL SECTION
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 132 

Federal Deposit Insurance Corporation

Deposit Insurance Fund Balance Sheet 

As of December 31

(Dollars in Thousands)

ASSETS

 Cash and cash equivalents $ 4,872,657 $ 2,599,206

 Investment in U.S. Treasury securities (Amortized Cost of 

 $18,958,454 and $125,427,772) (Note 3) 18,928,885 122,442,357

 Assessments receivable (Note 12) 3,235,766 2,159,249

 Special assessments receivable (Note 5) 20,423,184 0

 Interest receivable on investments and other assets, net 145,780 688,061

 Receivables from resolutions, net of allowances of 

 $69,361,715 and $40,047,224 (Note 4) 97,778,346 520,555

 Property and equipment, net (Note 6) 319,733 360,141

 Operating lease right-of-use assets (Note 7) 80,747 92,406

Total Assets $ 145,785,098 $ 128,861,975

LIABILITIES

 Accounts payable and other liabilities (Note 8) $ 410,515 $ 268,216

 Operating lease liabilities (Note 7) 101,617 111,205

 Liabilities due to resolutions (Note 9) 22,513,085 846

 Postretirement benefit liability (Note 16) 255,574 231,781

 Contingent liabilities:

 Anticipated failure of insured institutions (Note 10) 725,877 31,233

 Litigation losses (Note 10) 450 800

Total Liabilities 24,007,118 644,081

 Off-balance-sheet exposure (Note 17)

FUND BALANCE

 Accumulated Net Income 121,797,208 131,176,093

ACCUMULATED OTHER COMPREHENSIVE INCOME

 Unrealized (loss) on U.S. Treasury securities, net (Note 3) (29,569) (2,985,415)

 Unrealized postretirement benefit gain (Note 16) 10,341 27,216

Total Accumulated Other Comprehensive (Loss) (19,228) (2,958,199)

Total Fund Balance 121,777,980 128,217,894

Total Liabilities and Fund Balance $ 145,785,098 $ 128,861,975

The accompanying notes are an integral part of these financial statements.

2023 2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 133 

Federal Deposit Insurance Corporation

Deposit Insurance Fund Statement of Income and Fund Balance 

For the Years Ended December 31

(Dollars in Thousands)

REVENUE

 Assessments (Note 12) $ 33,188,017 $ 8,310,816

 Interest on U.S. Treasury securities 2,735,999 1,246,302

 Return of unclaimed insured deposits (Note 13) 16,714 37,913

 Other revenue 55,057 11,635

Total Revenue 35,995,787 9,606,666

EXPENSES AND LOSSES

 Operating expenses (Note 14) 2,125,978 1,882,884

 Provision for insurance losses (Note 15) 40,950,768 (82,964)

 Realized loss on sale of investments, net (Note 3) 2,291,859 0

 Insurance and other expenses 6,067 3,531

Total Expenses and Losses 45,374,672 1,803,451

Net (Loss) Income (9,378,885) 7,803,215

OTHER COMPREHENSIVE INCOME

 Unrealized gain (loss) on U.S. Treasury securities, net 2,955,846 (2,836,300)

 Unrealized postretirement benefit (loss) gain (Note 16) (16,875) 109,939

Total Other Comprehensive Gain (Loss) 2,938,971 (2,726,361)

Comprehensive (Loss) Income (6,439,914) 5,076,854

Fund Balance - Beginning 128,217,894 123,141,040

Fund Balance - Ending $ 121,777,980 $ 128,217,894

The accompanying notes are an integral part of these financial statements.

2023 2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 134 

Federal Deposit Insurance Corporation

Deposit Insurance Fund Statement of Cash Flows

For the Years Ended December 31

(Dollars in Thousands)

OPERATING ACTIVITIES

Provided by:

 Assessments $ 11,684,277 $ 7,862,116

 Interest on U.S. Treasury securities 2,719,799 3,127,123

 Recoveries from financial institution resolutions 43,143,054 470,381

 Return of unclaimed insured deposits 17,583 37,913

 Miscellaneous receipts 5,437 1,833

Used by:

 Operating expenses (2,086,522) (1,806,647)

 Disbursements for financial institution resolutions (157,962,304) (3,568)

 Miscellaneous disbursements (5,847) (802)

Net Cash (Used) Provided by Operating Activities (102,484,523) 9,688,349

INVESTING ACTIVITIES

Provided by:

 Maturity of U.S. Treasury securities 37,625,000 48,400,000

 Sale of U.S. Treasury securities 79,819,109 0

Used by:

 Purchase of U.S. Treasury securities (12,671,211) (60,978,672)

 Purchase of property and equipment (14,924) (73,412)

Net Cash Provided (Used) by Investing Activities 104,757,974 (12,652,084)

Net Increase (Decrease) in Cash and Cash Equivalents 2,273,451 (2,963,735)

Cash and Cash Equivalents - Beginning 2,599,206 5,562,941

Cash and Cash Equivalents - Ending $ 4,872,657 $ 2,599,206

The accompanying notes are an integral part of these financial statements.

2023 2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 135 

DEPOSIT INSURANCE FUND 

NOTES TO THE FINANCIAL STATEMENTS 

December 31, 2023 and 2022 

1 

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. Federally chartered IDIs are supervised by the

Office of the Comptroller of the Currency; state chartered IDIs

that are members of the Federal Reserve are supervised by

the Federal Reserve and their state supervisors; and state

chartered IDIs that are not members of the Federal Reserve

are supervised by the FDIC and their state supervisors.

In addition to being the administrator of the DIF, the FDIC is

the administrator of the Federal Savings and Loan Insurance

Corporation (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 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. This systemic risk

determination is distinct from the systemic risk

determination discussed in Note 5.

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 a

liquidity event determination 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 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

supervised by the Federal Reserve Board. 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 FDIC, as administrator of the DIF, insures the deposits of 

IDIs and resolves failed IDIs upon appointment of the FDIC as 

receiver in a manner that will result in the least possible cost 

to the DIF.

The DIF is primarily funded from deposit insurance

assessments and interest earned on investments in U.S. 

Treasury securities. 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 (Agreement) with 

the FFB to enhance the DIF’s ability to fund deposit insurance.

Under the FFB Agreement, the maximum principal amount of

any Note that is offered for purchase by the FDIC to the FFB 

shall not cause the FDIC to exceed the Maximum Obligation

Limitation (MOL).

The MOL is a statutory formula that 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 $210.0 billion and $227.5 billion as of December

31, 2023 and 2022, respectively.
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 136 

DEPOSIT INSURANCE FUND

2 

OPERATIONS OF RESOLUTION ENTITIES 

The FDIC, as receiver, is responsible for managing and

disposing of the assets of failed institutions in an orderly and

efficient manner. The assets held by receiverships,

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, as

administrator of the DIF, 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 and other contingencies. 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 special

assessments receivable and associated revenue; the

allowance for credit losses on receivables from resolutions

(including shared-loss agreements); guarantee obligations; 

the postretirement benefit obligation; and the estimated

losses for anticipated failures.

CASH EQUIVALENTS

Cash equivalents are short-term, highly liquid investments 

consisting primarily of U.S. Treasury Overnight Certificates. 

INVESTMENT IN U.S. TREASURY SECURITIES

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 based on market prices exclusively through 

the Treasury’s Bureau of the Fiscal Service’s Government

Account Series program.

The DIF’s investments in U.S. Treasury securities are classified

as available-for-sale (AFS). Securities designated as AFS are

presented at fair value and disclosed at amortized cost.

Unrealized gains and losses are reported as other

comprehensive income. Any 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 straight-line method 

(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 regular risk-based assessment

rate and assessment base for the prior quarter adjusted for

certain changes in supervisory examination ratings for larger 

institutions, 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 12).

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 6).

LEASES

The Balance Sheet presents operating leases in the

“Operating lease right-of-use assets” and “Operating lease

liabilities” line items. Operating lease liabilities and right-of-
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 137 

 

 

NOTES TO THE FINANCIAL STATEMENTS

3 

use (ROU) assets are recognized based on the present value of 

the future minimum lease payments over the lease term at

the commencement date. The FDIC has elected to use its riskfree rate at the commencement date in determining the

present value of future payments for all classes of underlying

assets, unless the rate implicit in the lease is readily 

determinable.

The operating lease ROU asset also includes lease 

prepayments and excludes lease incentives received. The

lease term includes options to extend or terminate the lease

when it is reasonably certain that the FDIC will exercise that 

option. For the DIF, the FDIC recognizes lease expense on a

straight-line basis over the lease term. For lease

arrangements that contain both lease and nonlease

components, the FDIC has elected to account for them as a

single lease component for all classes of underlying assets

(see Note 7).

ALLOWANCE FOR CREDIT LOSSES

The allowance for credit losses on receivables from

resolutions includes management’s estimate of all expected

credit losses based on past events, current conditions, and

reasonable and supportable forecasts about the future, as 

applicable (see Note 4).

PROVISION FOR INSURANCE LOSSES 

The provision for insurance losses primarily represents

changes in the allowance for credit losses on receivables from 

resolutions and the contingent liability for anticipated failure 

of insured institutions (see Note 15).

REPORTING ON VARIABLE INTEREST ENTITIES 

The FDIC conducts a qualitative assessment of its relationship

with variable interest entities (VIEs) as required by the

Financial Accounting Standards Board Accounting Standards

Codification (FASB ASC) Topic 810, Consolidation. This

assessment is conducted to determine if the FDIC, in its 

corporate capacity, has (1) the 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 tests, 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 the VIE is 

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, management

considers which, if any, activities were significant to the VIE. 

In 2023, the receivership related to the failure of First Republic

Bank engaged in a structured transaction, which resulted in

the issuance of a note obligation that the FDIC guaranteed, in 

its corporate capacity. As the guarantor of this note

obligation for the structured transaction, the FDIC, in its 

corporate capacity, holds an interest in a VIE. It was 

determined that the structured transaction did not include

significant activities and that the design of the entity was the

best indicator of which party was the primary beneficiary. As

such, the conclusion of the qualitative assessment of the

FDIC’s relationship with the VIE as required by ASC Topic 810 

is 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 the VIE with which it was involved as 

of December 31, 2023. Therefore, consolidation is not

required for the December 31, 2023 DIF financial statements. 

Note 8, under FDIC Guaranteed Debt of a Structured

Transaction, fully describes the FDIC’s involvement with the

VIE. 

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 notes.

APPLICATION OF RECENT ACCOUNTING STANDARDS

In June 2016, the FASB issued Accounting Standards Update

2016-13, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments. The

guidance replaces the incurred loss impairment model with a

new expected credit loss model for financial assets measured

at amortized cost and for off-balance-sheet credit exposures.

The guidance also amends the AFS debt securities

impairment model by requiring the use of an allowance to 

record estimated credit losses (and subsequent recoveries) 

related to AFS debt securities when their fair value is less than 

their amortized cost basis due to credit losses.

Topic 326 was effective for the DIF on January 1, 2023 and did

not have a material impact on the DIF. However, presentation 

changes were required to the “Investment in U.S. Treasury

securities” and “Receivables from resolutions, net” line items 

on the Balance Sheet.

Other recent accounting standards have been deemed not

applicable or material to the financial statements as 

presented.
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 138 

DEPOSIT INSURANCE FUND

4 

RECLASSIFICATION

In 2023, the FDIC reclassified amounts out of “Accounts

payable and other liabilities” into a new line item “Liabilities 

due to resolutions” on the Balance Sheet due to materiality. 

For comparative purposes, the FDIC conformed 2022 to the 

new presentation. 

3. Investment in U.S. Treasury Securities 

The “Investment in U.S. Treasury securities” line item on the Balance Sheet consisted of the following components by maturity 

(dollars in thousands). 

December 31, 2023

Yield at

Maturity Purchase

Within 1 year 4.66% $ 19,100,000 $ 18,958,454 $ 8,541 $ (38,110) $ 18,928,885

Total $ 19,100,000 $ 18,958,454 $ 8,541 $ (38,110) (a) $ 18,928,885

Value

Face Carrying

Amount

Net Unrealized

Holding

Gains

Fair

Value

Unrealized

Holding

Losses

U.S. Treasury notes and bonds

(a) These unrealized losses occurred as a result of 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 

recovery of their amortized cost basis. However, the $38 million reported as total unrealized losses occurred over a period of 12 months or longer, with an aggregate related fair value 

of $5.5 billion applied to the affected securities. The aggregate related fair value of all securities with unrealized losses was $5.5 billion as of December 31, 2023. 

December 31, 2022

Yield at

Maturity Purchase

Within 1 year 0.67% $ 62,125,000 (a) $ 62,596,907 $ 0 $ (1,214,092) $ 61,382,815

After 1 - 5 years 2.81% 64,150,000 62,830,865 16,308 (1,787,631) 61,059,542

Total $ 126,275,000 $ 125,427,772 $ 16,308 $ (3,001,723) (b) $ 122,442,357

U.S. Treasury notes and bonds

Fair

Value

Unrealized

Holding

Losses

Carrying

Amount

Net Unrealized

Holding

Value Gains

Face

(a) Includes three securities totaling $3.0 billion, which matured on Saturday, December 31, 2022. Settlements occurred the next business day, January 3, 2023. 

(b) These unrealized losses occurred as a result of changes in market interest rates. As of December 31, 2022, the FDIC does not intend to sell the securities and is not likely to be required 

to sell them before recovery of their amortized cost basis. However, $2.2 billion of the $3.0 billion reported as total unrealized losses occurred over a period of 12 months or longer, with 

an aggregate related fair value of $62.8 billion applied to the affected securities. The aggregate related fair value of all securities with unrealized losses was $112.9 billion as of December 

31, 2022. 

In 2023, the FDIC sold securities designated as AFS for total 

proceeds of $79.8 billion. The gross realized gains and losses 

on these sales were $135 million and $2.4 billion, respectively, 

which resulted in a total net loss of $2.3 billion. The cost of 

the sold securities was determined based on specific 

identification. The net loss was recognized in the “Realized 

loss on sale of investments, net” line item on the Statement 

of Income and Fund Balance. The FDIC reclassified the $2.3 

billion out of accumulated other comprehensive income to 

the “Realized loss on sale of investments, net” line item, 

representing net unrealized losses recorded as of December 

31, 2022 ($2.2 billion) and net holding losses arising during the 

current period ($76 million). The reclassification of net losses 

had no net effect on the 2023 comprehensive loss on the DIF 

Statement of Income and Fund Balance. 

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 credit losses 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 resolution entities (including structured transactionrelated assets from current and prior year failures) are the 

main source of repayment of the DIF’s receivables from 

resolutions. 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 139 

 

 

NOTES TO THE FINANCIAL STATEMENTS

5 

As of December 31, 2023, the FDIC, as receiver, managed 74 

active receiverships, including 7 receiverships established in 

2023. The resolution entities held assets with a total book 

value of $115.2 billion as of December 31, 2023 and $943

million as of December 31, 2022. Of these assets, cash,

investments, and other receivables total $30.6 billion and 

$909 million, respectively. Other assets held by resolution 

entities are assets in liquidation of $84.6 billion as of 

December 31, 2023 and $34 million as of December 31, 2022.

Estimated cash recoveries from the management and

disposition of assets in liquidation that are used to determine

the allowance for credit losses are based on asset recovery 

rates from several sources, which may include the following:

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 2007.

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 asset recoveries are then 

used to derive the allowance for credit losses on the

receivables from these resolutions.

For failed institutions resolved using a purchase and

assumption transaction with an accompanying SLA, the 

projected future shared-loss payments and the end of

agreement true-up recoveries on the covered residential and

commercial loan assets sold to the acquiring institution under

the agreement are considered in determining the allowance

for credit losses on the receivables from these resolutions.

True-up recoveries are projected to be received at expiration 

in accordance with the terms of the SLA. 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. The shared-loss cost projections were

primarily based on third-party valuations estimating the

cumulative loss of covered assets.

Note that estimated asset recoveries on assets in liquidation

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.

PURCHASE AND ASSUMPTION TRANSACTIONS WITH

SHARED-LOSS AGREEMENTS

During 2023, the FDIC resolved three failures using purchase 

and assumption resolution transactions with accompanying

SLAs on total assets of $229.3 billion purchased by financial 

institution acquirers. The acquirers assumed all of the 

deposits and purchased most of the assets of the failed

institutions. The majority of the commercial and residential

loan assets were purchased under an SLA, where the FDIC

agrees to share in future losses and recoveries experienced by 

the acquirer on those assets covered under the agreement.

SLAs are used by the FDIC to keep assets in the private sector 

and to minimize disruptions to loan customers. 

Losses on the covered assets are shared between the acquirer

of the failed institution and the FDIC, in its receivership

capacity, of the failed institution when losses occur through 

the sale, foreclosure, loan modification, or write-down of

loans in accordance with the terms of the SLA. The

agreements cover a seven- to eight-year period with the

receiver covering 50 to 95 percent of the losses incurred by the

acquiring bank. As mentioned above, the estimated sharedloss liability is accounted for by the receiver and is included in

the calculation of the DIF’s allowance for credit losses against

the corporate receivable from the resolution. As shared-loss

claims are asserted and proven, 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 9). 

As of December 31, 2023, no shared-loss payments have been

made. In addition, the receiverships are estimated to pay $2.4

billion over the duration of these SLAs. 

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 receiverships and payments on 

covered assets under SLAs. The majority of the remaining

assets in liquidation ($84.6 billion) and current shared-loss 

covered assets ($229.3 billion), which together total $314

billion, are primarily concentrated in commercial loans

($122.7 billion), residential loans ($106.8 billion), structured 

transaction-related assets ($66.7 billion), and securities

($12.9 billion). 




FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 140 

DEPOSIT INSURANCE FUND

6 

5. Special Assessments Receivable 

In accordance with Section 13(c)(4)(G) of the FDI Act, on March 

12, 2023, the Secretary of the Treasury, acting on the 

recommendation of the FDIC Board of Directors and the 

Board of Governors of the Federal Reserve System and after 

consultation with the President of the United States, invoked 

the statutory systemic risk exception to allow the FDIC to 

complete its resolution of both Silicon Valley Bank, Santa 

Clara, CA, and Signature Bank, New York, NY, in a manner that 

protected uninsured depositors. Section 13(c)(4)(G) of the 

FDI Act also provides the FDIC with discretion in the design of 

a time period for any special assessments to recover the 

losses to the DIF as a result of the systemic risk 

determination. Accordingly, in November 2023, the FDIC 

Board issued a final rule to impose a special assessment on 

applicable IDIs to recover the loss to the DIF arising from the 

protection of uninsured depositors in connection with the 

systemic risk determination. 

The assessment base for the special assessments will be 

equal to an IDI’s estimated uninsured deposits, reported as of 

December 31, 2022, adjusted to exclude the first $5 billion in 

estimated uninsured deposits from the IDI, or for IDIs that are 

part of a holding company with one or more subsidiary IDIs, 

at the banking organization level. This special assessment 

will be collected at an annual rate of approximately 13.4 basis 

points, over eight quarterly assessment periods beginning 

with the first quarterly assessment period of 2024. 

As of December 31, 2023, the DIF recorded a receivable of 

$20.4 billion, representing the estimated loss arising from the 

full coverage of uninsured deposits. No allowance for credit 

losses is recognized for the special assessments receivable 

because historical credit loss information, adjusted for 

current conditions and reasonable and supportable 

forecasts, results in an expectation that the receivable will be 

paid. In addition, the DIF recognized assessment revenue of 

$20.4 billion that fully offset the estimated losses arising from 

the full coverage of uninsured deposits; therefore, there was 

no impact to the Fund Balance of the DIF. Because the 

estimated loss pursuant to the systemic risk determination 

will be periodically adjusted, the FDIC retains the ability to: 

cease collection early, 

extend the special assessment collection period one or 

more quarters beyond the initial eight-quarter 

collection period to collect the difference between 

actual or estimated losses and the amounts collected, 

and 

 impose a final shortfall special assessment on a onetime basis after the receiverships for Silicon Valley

Bank and Signature Bank terminate.

6. Property and Equipment, Net 

Depreciation expense was $35 million and $39 million for 2023 

and 2022, respectively. The “Property and equipment, net” 

line item on the Balance Sheet consisted of the following 

components (dollars in thousands). 

Land $ 37,352 $ 37,352

Buildings (including building and

leasehold improvements) 384,381 385,151

Application software (includes work-inprocess) 84,679 111,172

Furniture, fixtures, & equipment 34,263 33,108

Accumulated depreciation (220,942) (206,642)

Total $ 319,733 $ 360,141

December 31

2023

December 31

2022

7. Leases

The FDIC has operating leases for office space, a data center, 

and certain equipment. The lease agreements generally 

contain escalation clauses resulting in upward adjustments in 

lease payments, usually on an annual basis. Many leases 

contain one or more options to extend, with renewal terms 

that can extend the lease term from one to five years, and 

some leases may include options to terminate. The following 

table provides relevant information regarding FDIC operating 

leases for the years ended December 31, 2023 and 2022 

(dollars in thousands). 

Operating lease cost $ 37,874 $ 39,782

Cash paid for amounts included in the 

measurement of operating leases $ 37,945 36,099

ROU assets obtained in exchange for new

operating lease liabilities $ 23,612 40,046

Weighted Average

 Remaining lease term (in years) 4.38 5.15

 Discount rate 2.57% 2.05%

December 31

2023

December 31

2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 141 

 

 

NOTES TO THE FINANCIAL STATEMENTS

7 

The following table provides a maturity analysis of the FDIC’s

operating lease liabilities as of December 31, 2023 (dollars in 

thousands).

2024 $ 34,379

2025 25,653

2026 11,932

2027 10,161

2028 7,238

2029/Thereafter 20,669

Total future minimum lease payments $ 110,032

Less: Imputed interest (8,415)

Total operating lease liabilities $ 101,617

2023

December 31

As of December 31, 2023, the FDIC has additional operating

leases with future payments totaling $2 million for office

space, which commence after December 31, 2023, and are not

included in the amounts presented above.

8. Other Liabilities 

FDIC GUARANTEED DEBT OF A STRUCTURED TRANSACTION 

In 2023, the FDIC, as receiver, used a structured transaction (a

Securitization and, hereafter, trust) to sell a $50 billion 

Purchase Money Note (PMN) issued by JP Morgan Chase Bank,

N.A. (JP Morgan), which is supported by a pool of mortgage 

loans (underlying collateral) acquired by JP Morgan through 

the related receivership and sale of First Republic Bank to JP 

Morgan. This resulted in the issuance of a single note (Note)

issued by the trust and sold to the FFB. This transaction with

FFB is not associated with the FFB Agreement that is

described in Note 1. In exchange for a fee, the FDIC, in its

corporate capacity, guarantees the timely payment of the

principal and interest due on the Note, with the guarantee

expected to terminate in 2028 when the Note matures. If the

FDIC is required to perform under its guarantee, it acquires an

interest in the cash flows of the trust equal to the amount of 

guarantee payments made plus accrued interest. Moreover,

the trust has established an interest reserve (reserve account)

to pay any interest shortfalls (the difference between the

coupon rate collected on the PMN and the anticipated coupon 

rate on the Note) and the Note may be paid prior to maturity.

In exchange for its guarantee, the FDIC, in its corporate 

capacity, received a $125 million fee which is recorded as 

deferred revenue included in the “Accounts payable and

other liabilities” line item and recognized as revenue on a

straight-line basis over the term of the Note. As of December

31, 2023, the amount of deferred revenue recorded was $117

million.

As of December 31, 2023, the maximum loss exposure is the

total outstanding Note of $50 billion. The FDIC’s exposure as

guarantor is protected by (1) JP Morgan’s strength as a

counterparty and commitment under the PMN, (2) overcollateralization of the PMN’s underlying collateral, (3) the 

funded reserve account to cover interest shortfalls, and (4) an

option to prepay the Note at par prior to maturity. As such,

the FDIC considers the likelihood of having to fund the Note

as remote and has estimated no credit losses over the life of 

the guarantee; therefore, no liability is required to be

recorded.

Except as discussed above, the DIF recorded no other

structured transaction-related assets or liabilities on its

balance sheet. 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 the structured

transaction that it was not previously contractually required

to provide.

9. Liabilities Due to Resolutions

As of December 31, 2023 and 2022, the DIF recorded liabilities

totaling $20.2 billion and $85 thousand, respectively, to

resolution entities representing the agreed-upon value of

assets transferred from the receiverships, at the time of

failure, to the acquiring institutions for use in funding the

deposits assumed by the acquiring institutions. The DIF

satisfies these liabilities by sending cash directly to a

receivership to pay claims, liabilities, and other expenses of 

the receiverships or by offsetting receivables from resolutions

when a receivership declares a dividend.

In addition, there were $2.3 billion and $761 thousand in

unpaid deposit claims related to multiple receiverships as of 

December 31, 2023 and 2022, respectively. The DIF pays these 

liabilities when the claims are proven.

10. 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
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 142 

DEPOSIT INSURANCE FUND

8 

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 remained resilient through the third 

quarter of 2023 amidst rising interest rates and economic

uncertainty. Five financial institutions failed during 2023,

with total assets of $532.2 billion, and an estimated loss on 

insured deposits to the DIF at December 31, 2023 of $20.0

billion. According to the third quarter 2023 financial data

submitted by FDIC-insured institutions, the banking industry

reported year-to-date net income of $218.6 billion, an

increase of 11.7 percent from the same period a year ago. The

increase in net income resulted from an increase in net

interest income exceeding growth in provision expenses and

noninterest expenses.

Provisions for credit losses reported by the banking industry 

for the first nine months of 2023 were $61.7 billion, versus 

$30.9 billion reported for the same time period a year ago. 

This change reflects loan growth as well as new economic

uncertainties. Despite these uncertainties, credit quality

metrics remained stable. The total noncurrent loan rate was 

0.82 percent as of September 30, 2023, up 10 basis points from

the same quarter in 2022 but well below the most recent high 

of 5.47 percent in March 31, 2010. 

The rising interest-rate environment has improved bank

margins. As of third quarter 2023, the quarterly net interest

margin (NIM) rose to 3.30 percent, up 16 basis points from a

year ago and up 74 basis points since the Federal Reserve 

began to increase the federal funds rate in first quarter 2021.

Growth in interest income outpaced growth in interest

expense, pushing net interestincome for the first nine months

of 2023 up $67.4 billion (14.8 percent) from the same period a

year ago. 

Due to the increase in net income and modest decline in riskweighted assets, risk-based capital ratios improved in the

third quarter 2023 from the same quarter in 2022. Total riskbased capital improved 53 basis points to 15.36 percent.

The contingent liability increased to $726 million as of 

December 31, 2023, compared to $31 million as of December

31, 2022. The increase reflects deterioration in financial 

conditions at a small number of troubled institutions. 

In addition to the recorded contingent liability, 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 $4.0 billion as of December 31, 2023,

compared to $273 million at December 31, 2022. The actual 

losses, if any, will largely depend on future economic and

market conditions and could differ materially from this

estimate.

Elevated inflation and interest rates, along with ongoing

geopolitical uncertainties may cause bank profitability, credit

quality, and loan growth to weaken. The FDIC continues to

evaluate 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 $450 thousand and $800 thousand for the DIF as of 

December 31, 2023 and 2022, respectively. In addition, the 

FDIC has identified no reasonably possible losses from 

unresolved cases as of December 31, 2023 and 2022.

11. Other Contingencies

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 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

2023 and 2022, 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.




FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 143 

 

 

NOTES TO THE FINANCIAL STATEMENTS

9 

12. 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 (12 CFR Part 327). The riskbased 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 longterm fund management 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. The DIF reserve ratio, 

which is the ratio of the DIF balance to estimated insured 

deposits, is a key measure of fund adequacy. Summarized 

below are key longer-term provisions of the plan. 

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 November 

2023, the FDIC published a notice maintaining the DRR 

at 2 percent for 2024. 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 

goal for the reserve ratio. 

The FDIC suspended dividends indefinitely, and, in lieu 

of dividends, prescribes progressively lower 

assessment rates when the reserve ratio exceeds 2 

percent and 2.5 percent. 

The Dodd-Frank Act increased the minimum reserve ratio for 

the DIF to 1.35 percent, up from the previous statutory 

minimum of 1.15 percent. If the reserve ratio falls below 1.35 

percent, or the FDIC projects that it will within six months, the 

FDIC generally must implement a Restoration Plan that will 

return the DIF to 1.35 percent within eight years. In 

September 2020, the FDIC established a Restoration Plan, 

maintaining the assessment rate schedules in place at the 

time, when the reserve ratio fell below 1.35 percent, to 1.30 

percent as of June 30, 2020, due to extraordinary insured 

deposit growth in the first and second quarters of 2020. In 

June 2022, the FDIC adopted an Amended Restoration Plan 

that would increase assessment rates because the reserve 

ratio was at risk of not reaching the statutory minimum of 1.35 

percent by the statutory deadline of September 30, 2028. 

In October 2022, the FDIC Board issued a final rule related to

increasing assessment rates. Under the rule, the FDIC

increased the initial base deposit insurance assessment rates 

for all IDIs by 2 basis points, beginning with the first quarterly 

assessment period of 2023. The increase in the assessment

rates will remain in effect unless and until the reserve ratio

meets or exceeds 2 percent in order to support progress 

towards the 2 percent DRR. 

ASSESSMENT REVENUE 

Annual assessment rates averaged approximately 6.1 cents 

and 4.0 cents per $100 of the assessment base in 2023 and 

2022, respectively. The assessment base is generally defined 

as average consolidated total assets minus average tangible 

equity (measured as Tier 1 capital) of an IDI during the 

assessment period. 

The “Assessments receivable” line item on the Balance Sheet 

of $3.2 billion and $2.2 billion represents the estimated 

premiums due from IDIs for the fourth quarter of 2023 and 

2022, respectively. No allowance for credit losses is 

recognized for Assessments Receivable because historical 

credit loss information, adjusted for current conditions and 

reasonable and supportable forecasts, results in an 

expectation that the receivable will be paid. The actual 

deposit insurance assessments for the fourth quarter of 2023 

will be billed and collected at the end of the first quarter of 

2024. The DIF recognized $33.2 billion and $8.3 billion as 

assessment revenue from institutions during 2023 and 2022, 

respectively. The year-over-year increase of $24.9 billion was 

primarily due to special assessments of $20.4 billion. 

PENDING LITIGATION FOR UNDERPAID ASSESSMENTS 

On January 9, 2017, the FDIC filed suit in the United States 

District Court for the District of Columbia (and amended this 

complaint on April 7, 2017), alleging that Bank of America, 

N.A. (BoA) underpaid its insurance assessments for multiple 

quarters based on the underreporting of counterparty 

exposures. In total, the FDIC alleges that BoA underpaid 

insurance assessments by $1.12 billion, including interest for 

the quarters ending March 2012 through December 2014. The 

FDIC invoiced BoA for $542 million and $583 million 

representing claims in the initial suit and the amended 

complaint, respectively. BoA has failed to pay these past due 

amounts. Pending resolution of this matter, BoA has fully 

pledged security with a third-party custodian pursuant to a 

security agreement with the FDIC. As of December 31, 2023, 

the total amount of unpaid assessments (including accrued 

interest) was $1.26 billion. For the years ending December 31, 

2023 and 2022, the impact of this litigation is not reflected in 

the financial statements of the DIF.
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 144 

DEPOSIT INSURANCE FUND

10 

RESERVE RATIO 

As of September 30, 2023 and December 31, 2022, the DIF 

reserve ratio was 1.13 percent and 1.25 percent, respectively. 

13. Return of Unclaimed Insured Deposits

The Unclaimed Deposits Amendments Act of 1993 (UDAA), 

Public Law 103-44, amended the FDI Act effective June 28, 

1993 (codified as 12 U.S.C. § 1822 (e)). In accordance with the 

UDAA, the FDIC delivers to the appropriate states insured 

bank deposits not claimed within 18 months of the date when 

the FDIC initiates payment of insured deposits as a part of a 

bank failure, unless the appropriate state declines to accept 

custody. After receipt, states have custody of the deposits for 

10 years, during which time a state treats deposits as 

unclaimed property. At the end of the 10 years, states are 

required to transfer any remaining unclaimed deposits to the 

FDIC and those deposits become the FDIC’s property. As of 

December 31, 2023 and 2022, states have returned $17 million 

and $38 million, respectively, of unclaimed insured deposits 

to the FDIC, which the DIF recognized as revenue. 

14. Operating Expenses 

The “Operating expenses” line item on the Statement of 

Income and Fund Balance consisted of the following

components (dollars in thousands). 

Salaries and benefits $ 1,488,361 $ 1,343,042

Outside services 306,070 269,741

Travel 53,409 20,528

Buildings and leased space 86,360 75,649

Software/Hardware maintenance 154,511 119,780

Depreciation of property and equipment 35,094 38,858

Other 25,843 22,993

Subtotal 2,149,648 1,890,591

Less: Expenses billed to resolution 

entities and others (23,670) (7,707)

Total $ 2,125,978 $ 1,882,884

December 31

2023

December 31

2022

15. Provision for Insurance Losses 

The “Provision for insurance losses” line item on the Statement of Income and Fund Balance is impacted by the Balance Sheet 

line item activity depicted in the table below. The table primarily analyzes the changes in estimated losses for actual and 

anticipated failures (dollars in millions). 

December 31, 2023

Balance at January 1, 2023 $ 0 $ 40,568 $ (40,047) $ (31) $ (1) $ (1)

 Estimated losses on insured and uninsured deposits for 

current year failures 40,370 (40,370)

 Change in contingent liability for anticipated failures, net 1 695 (695)

 Adjustments to estimated losses for prior year failures (105) 105

 Disbursements for failures 2 393,148 (277,988)

 Recoveries from resolutions 3 (257,953) 257,763

 Write-offs for inactivated receiverships (4) (10,533) 10,537

 Other (5) 1,910 413 1 (2,287)

Balance at December 31, 2023 $ 40,951 $ 167,140 $ (69,362) $ (726) $ 0 $ (22,513)

for Insurance

Losses

from

Resolutions

Liabilities

due to

Resolutions

Allowance

for Credit

Losses

Provision Receivables

Anticipated 

 Failures 

Contingent Liabilities for:

Litigation 

Losses

1

Represents institutions that were added or removed from the contingent liability, as well as the change in the contingent liability for institutions that remained in the liability year-overyear. 

2

Includes $278 billion of non-cash transactions from receiverships (see Note 9). 

3

Includes $257.8 billion of non-cash dividends from receiverships (see Note 9). 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 145 

 

 

NOTES TO THE FINANCIAL STATEMENTS

11 

December 31, 2022

Balance at January 1, 2022 $ 0 $ 56,228 $ (55,343) $ (21) $ 0 $ (1)

 Change in contingent liability for anticipated failures, net 1 10 (10)

 Adjustments to estimated losses for prior year failures (87) 87

 Disbursements for prior year failures 10

 Recoveries from resolutions (459) 0

 Write-offs for inactivated receiverships (3) (13,719) 13,722

 Other (3) (1,492) 1,487 (1) 0

Balance at December 31, 2022 $ (83) $ 40,568 $ (40,047) $ (31) $ (1) $ (1)

Provision Receivables Allowance Contingent Liabilities for:

for Insurance from for Credit Anticipated 

Losses Resolutions Losses Failures 

Liabilities

due to

Resolutions

Litigation 

Losses

1

Represents institutions that were added or removed from the contingent liability, as well as the change in the contingent liability for institutions that remained in the liability year-overyear. 

16. 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. In addition, under an FDIC-sponsored pre-tax 

and after-tax 401k savings plan, eligible FDIC employees are 

provided with an automatic contribution of 4 percent of pay, 

regardless of their participation in the plan, and an additional 

matching contribution up to 1 percent of pay. The expenses 

for these plans are presented in the table below (dollars in 

thousands). 

Civil Service Retirement System $ 499 $ 286

Federal Employees Retirement System (Basic Benefit) 173,957 159,473

Federal Thrift Savings Plan 43,978 39,851

FDIC Savings Plan 45,905 40,259

Total $ 264,339 $ 239,869

December 31

2023

December 31

2022

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 OPM. In addition, OPM pays the 

employer share of the retiree’s health insurance premiums. 

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 for converting optional coverage to directpay 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 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 146 

DEPOSIT INSURANCE FUND

12 

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 (dollars

in thousands). 

Accumulated postretirement benefit obligation

recognized in Postretirement benefit liability $ 255,574 $ 231,781

Cumulative net actuarial gain recognized in

accumulated other comprehensive income: Unrealized

postretirement benefit gain $ 10,341 $ 27,216

Amounts recognized in other comprehensive income:

Unrealized postretirement benefit (loss) gain

Actuarial (loss) gain $ (16,875) $ 109,939

Net periodic benefit costs recognized in Operating

expenses

 Service cost $ 3,446 $ 6,208

 Interest cost 11,666 8,122

 Net amortization out of other comprehensive

 income (280) 3,521

 Total $ 14,832 $ 17,851

December 31

2022

December 31

2023

The year-over-year increase in the accumulated

postretirement benefit obligation (APBO) of $24 million is 

primarily attributable to net periodic benefit costs of $15

million and a decrease in the discount rate that increased the

APBO by $9 million. The discount rate, used to present value

expected benefit payments, decreased from 5.27 percent to

5.04 percent at year-end 2023 to reflect changes in the

economic environment.

The annual postretirement contributions and benefits paid

are included in the table below (dollars in thousands).

Employer contributions $ 7,913 $ 7,731

Plan participants' contributions $ 1,229 $ 1,197

Benefits paid $ (9,142) $ (8,928)

December 31

2022

December 31

2023

The expected contributions for the year ending December 31,

2024 are $11 million. Expected future benefit payments for

each of the next 10 years are presented in the following table

(dollars in thousands).

2024 2025 2026 2027 2028 2029-2033

$10,311 $10,985 $11,649 $12,223 $12,656 $69,408

Assumptions used to determine the amount of the

accumulated postretirement benefit obligation and the net

periodic benefit costs are summarized as follows.

December 31 December 31

2023 2022

Discount rate for future benefits (benefit obligation) 5.04% 5.27%

Rate of compensation increase 6.95% 7.79%

Discount rate (benefit cost) 5.27% 2.82%

Dental health care cost-trend rate

 Assumed for next year 3.50% 3.50%

 Ultimate 3.50% 3.50%

 Year rate will reach ultimate 2024 2023

17. 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, 2023 and December 31, 2022, estimated

insured deposits for the DIF were $10.6 trillion and $10.3

trillion, respectively.

18. Fair Value of Financial Instruments

As of December 31, 2023 and 2022, financial assets recognized

and measured at fair value on a recurring basis include cash

equivalents (see Note 2) of $4.9 billion and $2.6 billion,

respectively, and the investment in U.S. Treasury securities

(see Note 3) of $18.9 billion and $122.4 billion, respectively.

The valuation is considered a Level 1 measurement in the fair

value hierarchy, representing quoted prices in active markets

for identical assets. Other financial assets and liabilities,

measured at amortized cost, are the receivables from

resolutions, assessments receivable, interest receivable on 

investments, other short-term receivables, and accounts

payable and other liabilities.
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 147 

 

 

NOTES TO THE FINANCIAL STATEMENTS

13 

19. Information Relating to the Statement of Cash Flows

The following table presents a reconciliation of net income to

net cash from operating activities (dollars in thousands).

Operating Activities

Net (Loss) Income: $ (9,378,885) $ 7,803,215

Adjustments to reconcile net (loss) income to net

cash (used) provided by operating activities:

Amortization of U.S. Treasury securities (595,440) 1,851,255

Depreciation on property and equipment 35,095 38,858

Retirement of property and equipment 3,799 1,540

Adjustment for cloud computing assets 16,440 0

Provision for insurance losses 40,950,768 (82,964)

Realized loss on sale of securities, net 2,291,859 0

Unrealized (loss) gain on postretirement benefits (16,875) 109,939

Change in Assets and Liabilities:

(Increase) in assessments receivable, net (1,076,517) (448,700)

(Increase) in special assessments receivable (20,423,184) 0

Decrease in interest receivable and other assets 542,816 30,667

(Increase) Decrease in receivables from resolutions (137,514,801) 458,420

Decrease (Increase) in operating lease right-of-use assets 11,659 (7,168)

Increase in accounts payable and other liabilities 142,299 12,811

(Decrease) Increase in operating lease liabilities (9,588) 20,248

Increase in liabilities due to resolutions 22,512,239 46

Increase (Decrease) in postretirement benefit liability 23,793 (99,818)

Net Cash (Used) Provided by Operating Activities $ (102,484,523) $ 9,688,349

December 31

2023

December 31

2022

20. Subsequent Events 

Subsequent events have been evaluated through February 

15, 2024, the date the financial statements are available to be 

issued. 

FDIC GUARANTEED DEBT OF STRUCTURED TRANSACTIONS

In January 2024, the FDIC, as receiver for Silicon Valley Bridge

Bank, N.A. (SVBB), used structured transactions to sell $10.5 

billion of Ginnie Mae Project Loan Securities and a $36.1 

billion Purchase Money Note (PMN) issued by First-Citizens

Bank & Trust Company (FCB). The PMN is supported by a pool 

of loans acquired by FCB through the receivership and sale of

SVBB. The trusts facilitating these structured transactions

issued Notes totaling $43.3 billion that were sold to the FFB. 

Estimated asset recoveries from these structured-transaction 

assets were used to derive the allowance for credit loss on the

DIF’s receivable from the SVBB resolution and the related

special assessments receivable as of December 31, 2023.

These transactions with FFB are not associated with the FFB 

Agreement that is described in Note 1. 

In exchange for fees received in January 2024 of $147 million,

the FDIC, in its corporate capacity, guaranteed the timely

payment of the principal and interest due on the Notes, with 

the guarantees expected to terminate in 2033 and 2028 when 

the Notes mature. 

The FDIC’s exposure as guarantor is protected by (1) the overcollateralization of the Notes’ underlying collateral, (2) the

option to prepay or terminate the Notes at par prior to 

maturity, (3) funded reserve accounts for the PMN to cover 

interest shortfalls, (4) full recourse obligation of FCB to pay

interest and principal on the PMN through maturity, and (5)

FCB’s capacity to meet its financial obligations. As such, the

FDIC considers the likelihood of having to fund the Notes as

remote.

DIVIDENDS FROM RECEIVERSHIPS 

In January 2024, DIF received approximately $43.5 billion in

dividends from the SVBB and Signature Bridge Bank

receiverships ($41.5 billion and $2.0 billion, respectively) as 

repayment of the DIF’s receivables from resolutions (see Note

4).
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 148 

Federal Deposit Insurance Corporation

FSLIC Resolution Fund Balance Sheet 

As of December 31

(Dollars in Thousands)

ASSETS

 Cash and cash equivalents $ 969,142 $ 922,224

 Other assets, net 161 161

Total Assets $ 969,303 $ 922,385

LIABILITIES

 Accounts payable and other liabilities $ 11 $ 6

Total Liabilities 11 6

RESOLUTION EQUITY (NOTE 5)

 Contributed capital 125,469,317 125,469,317

 Accumulated deficit (124,500,025) (124,546,938)

Total Resolution Equity 969,292 922,379

Total Liabilities and Resolution Equity $ 969,303 $ 922,385

The accompanying notes are an integral part of these financial statements.

2023 2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 149 

Federal Deposit Insurance Corporation

FSLIC Resolution Fund Statement of Income and Accumulated Deficit

For the Years Ended December 31

(Dollars in Thousands)

REVENUE

 Interest on U.S. Treasury securities $ 46,777 $ 14,524

 Other revenue 419 352

Total Revenue 47,196 14,876

EXPENSES AND LOSSES

 Operating expenses 322 250

 Losses related to thrift resolutions (39) 65

Total Expenses and Losses 283 315

Net Income 46,913 14,561

Accumulated Deficit - Beginning (124,546,938) (124,561,499)

Accumulated Deficit - Ending $ (124,500,025) $ (124,546,938)

The accompanying notes are an integral part of these financial statements.

2023 2022
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 150 

Federal Deposit Insurance Corporation

FSLIC Resolution Fund Statement of Cash Flows

For the Years Ended December 31

(Dollars in Thousands)

OPERATING ACTIVITIES

Provided by:

Interest on U.S. Treasury securities $ 46,777 $ 14,524

Recoveries from thrift resolutions 472 351

Used by:

Operating expenses (331) (276)

Net Cash Provided by Operating Activities 46,918 14,599

Net Increase in Cash and Cash Equivalents 46,918 14,599

Cash and Cash Equivalents - Beginning 922,224 907,625

Cash and Cash Equivalents - Ending $ 969,142 $ 922,224

The accompanying notes are an integral part of these financial statements.

2023 2022
FSLIC RESOLUTION FUND 









FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 151 

NOTES TO THE FINANCIAL STATEMENTS 

December 31, 2023 and 2022 

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 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 Federal Savings and Loan Insurance 

Corporation (FSLIC) Resolution Fund (FRF). As such, the FDIC 

is responsible for the sale of remaining assets and 

satisfaction of liabilities associated with the former 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 by authorizing REFCORP to issue debt 

obligations. The REFCORP issued debt obligations in the 

form of long-term bonds ranging in maturity from 2019 to 

2030. 

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. 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 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 FRFFSLIC. 

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 

16 years remaining to enforce); 

collections of judgments obtained against officers

and directors and other professionals responsible

for causing or contributing to thrift losses (generally

have up to 10 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; and

Affordable Housing Disposition Program monitoring

(the last agreement expires no later than 2045; see

Note 4). 

The FRF could realize recoveries from 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, on 

behalf of the FRF, when the last active receivership was 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 152 

NOTES TO THE FINANCIAL STATEMENTS

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 that could not be liquidated during the

life of the receiverships due to restrictive clauses and other 

impediments. 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, as administrator of the FRF, 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 

estimate for the Affordable Housing Disposition Program 

indemnifications is considered significant (see Note 4).

CASH EQUIVALENTS

Cash equivalents are short-term, highly liquid investments

consisting primarily of U.S. Treasury Overnight Certificates. 

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 notes.

APPLICATION OF RECENT ACCOUNTING STANDARDS

Recent accounting standards have been deemed not 

applicable or material to the financial statements as 

presented.

3. 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,

1501A-20), 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. 

All known goodwill cases have been litigated, including the 

last remaining goodwill case that was resolved in 2015.

However, a determination regarding the continued need for 

the appropriation will be made as the FRF winds up its

operations. 

4. 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-
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 153 

FSLIC RESOLUTION FUND 

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 34 

monitoring agencies to oversee these LURAs. As of December 

31, 2023, 20 monitoring agencies oversee these LURAs. The 

FDIC, through the FRF, has agreed to indemnify the

monitoring agencies for all losses related to LURA legal

enforcement proceedings.

From 2006 through 2018, two lawsuits against property

owners resulted in $23 thousand in legal expenses, which

were fully reimbursed due to successful litigation. In 2019, 

new litigation against two property owners has thus far 

resulted in legal expenses of $46 thousand. In 2022, one of

the litigation cases was settled and the FDIC was reimbursed 

$7 thousand. 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, 2023 and 2022, no contingent liability for 

this indemnification has been recorded.

5. Resolution Equity

As stated in the Overview section of Note 1, the FRF is 

composed of two distinct pools: the FRF-FSLIC and the FRFRTC. The FRF-FSLIC consists of the assets and liabilities of

the former FSLIC. The FRF-RTC 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

(dollars in thousands).

December 31, 2023

Contributed capital $ 43,864,980 $ 81,604,337 $ 125,469,317

Accumulated deficit (42,921,160) (81,578,865) (124,500,025)

Total Resolution Equity $ 943,820 $ 25,472 $ 969,292

FRF

FRF-FSLIC FRF-RTC Consolidated

December 31, 2022

Contributed capital $ 43,864,980 $ 81,604,337 $ 125,469,317

Accumulated deficit ($42,968,050) ($81,578,888) (124,546,938)

Total Resolution Equity $ 896,930 $ 25,449 $ 922,379

FRF 

FRF-FSLIC FRF-RTC Consolidated

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 FRF-FSLIC 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. Through December 31, 2023, the FRF-FSLIC

received a total of $2.3 billion in goodwill appropriations, the

effect of which increased contributed capital. 

Through December 31, 2023, the FRF-RTC had returned $4.6

billion to the U.S. Treasury and made payments of $5.2 billion

to the REFCORP. The most recent payment to the REFCORP 

was in July of 2020 for $20 million. In addition, the FDIC 

returned $2.6 billion to the U.S. Treasury on behalf of the FRFFSLIC 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 FRF-FSLIC

accumulated deficit increased by $13.1 billion, whereas the

FRF-RTC accumulated deficit decreased by $6.3 billion. 

6. Fair Value of Financial Instruments

At December 31, 2023 and 2022, the FRF’s financial assets

measured at fair value on a recurring basis are cash

equivalents (see Note 2) of $944 million and $897 million,

respectively. Cash equivalents are Special U.S. Treasury

Certificates with overnight maturities valued at prevailing

interest rates established by the U.S. Treasury’s Bureau 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.
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 154 

NOTES TO THE FINANCIAL STATEMENTS

7. Information Relating to the Statement of Cash Flows

The following table presents a reconciliation of net income to

net cash from operating activities (dollars in thousands).

Operating Activities

Net Income: $ 46,913 $ 14,561

Change in Assets and Liabilities:

Decrease in other assets, net 0 40

Increase (Decrease) in accounts

payable and other liabilities 5 (2)

Net Cash Provided by Operating

Activities $ 46,918 $ 14,599

2023

December 31

2022

December 31

8. Subsequent Events

Subsequent events have been evaluated through February

15, 2024, the date the financial statements are available to be

issued. Based on management’s evaluation, there were no

subsequent events requiring disclosure. 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 155 

441 G St. N.W. 

Washington, DC 20548 

Independent Auditor’s Report 

To the Board of Directors of the Federal Deposit Insurance Corporation 

In our audits of the 2023 and 2022 financial statements of the Deposit Insurance Fund (DIF) and 

of the Federal Savings and Loan Insurance Corporation (FSLIC) Resolution Fund (FRF), both of 

which the Federal Deposit Insurance Corporation (FDIC) administers,1 we found 

• the financial statements of the DIF and of the FRF as of and for the years ended 

December 31, 2023, and 2022, are presented fairly, in all material respects, in accordance 

with U.S. generally accepted accounting principles; 

• FDIC maintained, in all material respects, effective internal control over financial reporting 

relevant to the DIF and to the FRF as of December 31, 2023; and 

• with respect to the DIF and to the FRF, no reportable noncompliance for 2023 with 

provisions of applicable laws, regulations, contracts, and grant agreements we tested. 

The following sections discuss in more detail (1) our report on the financial statements and on 

internal control over financial reporting and other information included with the financial 

statements;2 (2) our report on compliance with laws, regulations, contracts, and grant 

agreements; and (3) agency comments. 

Report on the Financial Statements and on Internal Control over Financial Reporting 

Opinions on the Financial Statements 

In accordance with Section 17 of the Federal Deposit Insurance Act, as amended,3 and the 

Government Corporation Control Act,4 we have audited the financial statements of the DIF and 

of the FRF, both of which FDIC administers. The financial statements of the DIF comprise the 

balance sheets as of December 31, 2023, and 2022; the related statements of income and fund 

balance and of cash flows for the years then ended; and the related notes to the financial 

statements. The financial statements of the FRF comprise the balance sheets as of 

December 31, 2023, and 2022; the related statements of income and accumulated deficit and of 

cash flows for the years then ended; and the related notes to the financial statements. In our 

opinion, 

1A third fund managed by FDIC, the Orderly Liquidation Fund, established by Section 210(n) of the Dodd-Frank Wall 

Street Reform and Consumer Protection Act, Pub. L. No. 111-203, 124 Stat. 1376, 1506 (2010), is unfunded and did 

not have any transactions from its inception in 2010 through 2023. 

2Other information consists of information included with the financial statements, other than the auditor’s report. 

3Act of September 21, 1950, Pub. L. No. 797, § 2[17], 64 Stat. 873, 890, classified as amended at 12 U.S.C. § 1827. 

431 U.S.C. §§ 9101-9110. 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 156 

• the DIF’s financial statements present fairly, in all material respects, the DIF’s financial 

position as of December 31, 2023, and 2022, and the results of its operations and its cash 

flows for the years then ended, in accordance with U.S. generally accepted accounting 

principles, and 

• the FRF’s financial statements present fairly, in all material respects, the FRF’s financial 

position as of December 31, 2023, and 2022, and the results of its operations and its cash 

flows for the years then ended, in accordance with U.S. generally accepted accounting 

principles. 

Opinions on Internal Control over Financial Reporting 

We also have audited FDIC’s internal control over financial reporting relevant to the DIF and to 

the FRF as of December 31, 2023, based on criteria established under 31 U.S.C. § 3512(c), (d), 

commonly known as the Federal Managers’ Financial Integrity Act of 1982 (FMFIA). 

In our opinion, 

• FDIC maintained, in all material respects, effective internal control over financial reporting 

relevant to the DIF as of December 31, 2023, based on criteria established under FMFIA, 

and 

• FDIC maintained, in all material respects, effective internal control over financial reporting 

relevant to the FRF as of December 31, 2023, based on criteria established under FMFIA. 

FDIC made progress during 2023 in addressing a significant deficiency5 that we reported in our 

prior year audits.6 Specifically, FDIC sufficiently addressed the deficiencies in contract

documentation and payment review process controls such that we no longer consider the 

remaining control deficiencies in this area, individually or collectively, to represent a significant 

deficiency as of December 31, 2023. 

During our 2023 audit, we identified other deficiencies in FDIC’s internal control over financial 

reporting that we do not consider to be material weaknesses or significant deficiencies. 

Nonetheless, these deficiencies warrant FDIC management’s attention. We have communicated 

these matters to FDIC management and, where appropriate, will report on them separately. 

Basis for Opinions 

We conducted our audits in accordance with U.S. generally accepted government auditing 

standards. Our responsibilities under those standards are further described in the Auditor’s 

Responsibilities for the Audits of the Financial Statements and Internal Control over Financial 

Reporting section of our report. We are required to be independent of FDIC and to meet our 

5A deficiency in internal control exists when the design or operation of a control does not allow management or 

employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, 

misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal 

control over financial reporting, such that there is a reasonable possibility that a material misstatement of the entity’s 

financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a 

deficiency, or combination of deficiencies, in internal control over financial reporting that is less severe than a material 

weakness, yet important enough to merit the attention by those charged with governance. 

6GAO, Financial Audit: Federal Deposit Insurance Corporation Funds’ 2022 and 2021 Financial Statements, GAO-23-

105570 (Washington, D.C.: Feb. 16, 2023). 
•

•

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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 157 

other ethical responsibilities, in accordance with the relevant ethical requirements relating to our 

audits. We believe that the audit evidence we have obtained is sufficient and appropriate to 

provide a basis for our audit opinions. 

Responsibilities of Management for the Financial Statements and Internal Control over Financial 

Reporting 

FDIC management is responsible for 

• the preparation and fair presentation of the financial statements in accordance with U.S. 

generally accepted accounting principles; 

preparing and presenting other information included in FDIC’s annual report, and ensuring 

the consistency of that information with the audited financial statements; 

• designing, implementing, and maintaining effective internal control over financial reporting 

relevant to the preparation and fair presentation of financial statements that are free from 

material misstatement, whether due to fraud or error; 

• assessing the effectiveness of internal control over financial reporting based on the criteria 

established under FMFIA; and 

its assessment about the effectiveness of internal control over financial reporting as of 

December 31, 2023, included in the accompanying Management’s Report on Internal 

Control over Financial Reporting in appendix I. 

In preparing the financial statements, management is required to evaluate whether there are 

conditions or events, considered in the aggregate, that raise substantial doubt about the DIF’s 

and the FRF’s ability to continue as going concerns for a reasonable period of time. 

Auditor’s Responsibilities for the Audits of the Financial Statements and Internal Control over 

Financial Reporting 

Our objectives are to (1) obtain reasonable assurance about whether the financial statements 

as a whole are free from material misstatement, whether due to fraud or error, and whether 

effective internal control over financial reporting was maintained in all material respects, and (2) 

issue an auditor’s report that includes our opinions. 

Reasonable assurance is a high level of assurance but is not absolute assurance and therefore 

is not a guarantee that an audit of the financial statements or an audit of internal control over 

financial reporting conducted in accordance with U.S. generally accepted government auditing 

standards will always detect a material misstatement or a material weakness when it exists. The 

risk of not detecting a material misstatement resulting from fraud is higher than for one resulting 

from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or 

the override of internal control. Misstatements, including omissions, are considered to be 

material if there is a substantial likelihood that, individually or in the aggregate, they would 

influence the judgment made by a reasonable user based on the financial statements. 

In performing an audit of financial statements and an audit of internal control over financial 

reporting in accordance with U.S. generally accepted government auditing standards, we: 

• Exercise professional judgment and maintain professional skepticism throughout the audits. 

• Identify and assess the risks of material misstatement of the financial statements, whether 

due to fraud or error, and design and perform audit procedures responsive to those risks. 
•

•

FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 158 

Such procedures include examining, on a test basis, evidence regarding the amounts and 

disclosures in the financial statements. 

• Obtain an understanding of internal control relevant to our audit of the financial statements 

in order to design audit procedures that are appropriate in the circumstances. 

Obtain an understanding of internal control relevant to our audit of internal control over 

financial reporting, assess the risks that a material weakness exists, and test and evaluate 

the design and operating effectiveness of internal control over financial reporting based on 

the assessed risk. Our audit of internal control also considered FDIC’s process for 

evaluating and reporting on internal control over financial reporting based on criteria 

established under FMFIA. We did not evaluate all internal controls relevant to operating 

objectives as broadly established under FMFIA, such as those controls relevant to preparing 

performance information and ensuring efficient operations. We limited our internal control 

testing to testing controls over financial reporting. Our internal control testing was for the 

purpose of expressing an opinion on whether effective internal control over financial 

reporting was maintained, in all material respects. Consequently, our audit may not identify 

all deficiencies in internal control over financial reporting that are less severe than a material 

weakness. 

• Evaluate the appropriateness of accounting policies used and the reasonableness of 

significant accounting estimates made by management, as well as evaluate the overall 

presentation of the financial statements. 

• Perform other procedures we consider necessary in the circumstances. 

Conclude whether, in our judgment, there are conditions or events, considered in the 

aggregate, that raise substantial doubt about the DIF’s and the FRF’s ability to continue as 

going concerns for a reasonable period of time. 

We are required to communicate with those charged with governance regarding, among other 

matters, the planned scope and timing of the audit, significant audit findings, and certain internal 

control-related matters that we identified during the financial statement audit. 

Definition and Inherent Limitations of Internal Control over Financial Reporting 

An entity’s internal control over financial reporting is a process effected by those charged with 

governance, management, and other personnel. The objectives of internal control over financial 

reporting are to provide reasonable assurance that 

• transactions are properly recorded, processed, and summarized to permit the preparation of 

financial statements in accordance with U.S. generally accepted accounting principles, and 

assets are safeguarded against loss from unauthorized acquisition, use, or disposition, and 

• transactions are executed in accordance with provisions of applicable laws, regulations, 

contracts, and grant agreements, noncompliance with which could have a material effect on 

the financial statements. 

Because of its inherent limitations, internal control over financial reporting may not prevent, or 

detect and correct, misstatements due to fraud or error. We also caution that projecting any 

evaluation of effectiveness to future periods is subject to the risk that controls may become 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 159 

inadequate because of changes in conditions, or that the degree of compliance with the policies 

or procedures may deteriorate. 

Other Information 

FDIC’s other information contains a wide range of information, some of which is not directly 

related to the financial statements. This information is presented for purposes of additional 

analysis and is not a required part of the financial statements. The other information comprises 

the following sections of FDIC’s 2023 agency financial report: Mission, Vision, and Values; 

Message from the Chairman; Message from the Chief Financial Officer; Management’s 

Discussion and Analysis; Performance Results Summary; Financial Highlights; Budget and 

Spending; Risk Management and Internal Controls; and Appendices. Management is 

responsible for the other information included in FDIC’s annual report. The other information 

does not include the financial statements and our auditor’s report thereon. Our opinion on the 

DIF’s and the FRF’s financial statements does not cover the other information, and we do not 

express an opinion or any form of assurance thereon. 

In connection with our audit of the financial statements, our responsibility is to read the other 

information and consider whether a material inconsistency exists between the other information 

and the financial statements, or the other information otherwise appears to be materially 

misstated. If, based on the work performed, we conclude that an uncorrected material 

misstatement of the other information exists, we are required to describe it in our report. 

Report on Compliance with Laws, Regulations, Contracts, and Grant Agreements 

In connection with our audits of the financial statements of the DIF and of the FRF, we tested 

compliance with selected provisions of applicable laws, regulations, contracts, and grant 

agreements consistent with our auditor’s responsibilities discussed below. 

Results of Our Tests for Compliance with Laws, Regulations, Contracts, and Grant Agreements 

Our tests for compliance with selected provisions of applicable laws, regulations, contracts, and 

grant agreements disclosed no instances of noncompliance for 2023 that would be reportable, 

with respect to the DIF and to the FRF, under U.S. generally accepted government auditing 

standards. However, the objective of our tests was not to provide an opinion on compliance with 

applicable laws, regulations, contracts, and grant agreements. Accordingly, we do not express 

such an opinion. 

Basis for Results of Our Tests for Compliance with Laws, Regulations, Contracts, and Grant 

Agreements 

We performed our tests of compliance in accordance with U.S. generally accepted government 

auditing standards. 

Responsibilities of Management for Compliance with Laws, Regulations, Contracts, and Grant 

Agreements 

FDIC management is responsible for complying with applicable laws, regulations, contracts, and 

grant agreements. 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 160 

 

Auditor’s Responsibilities for Tests of Compliance with Laws, Regulations, Contracts, and Grant 

Agreements 

Our responsibility is to test compliance with selected provisions of applicable laws, regulations, 

contracts, and grant agreements that have a direct effect on the determination of material 

amounts and disclosures in the financial statements of the DIF and of the FRF, and to perform 

certain other limited procedures. Accordingly, we did not test compliance with all provisions of 

laws, regulations, contracts, and grant agreements. We caution that noncompliance may occur 

and not be detected by these tests.

Intended Purpose of Report on Compliance with Laws, Regulations, Contracts, and Grant 

Agreements 

The purpose of this report is solely to describe the scope of our testing of compliance with 

selected provisions of applicable laws, regulations, contracts, and grant agreements, and the 

results of that testing, and not to provide an opinion on compliance. This report is an integral 

part of an audit performed in accordance with U.S. generally accepted government auditing 

standards in considering compliance. Accordingly, this report on compliance with laws, 

regulations, contracts, and grant agreements is not suitable for any other purpose.

Agency Comments 

In commenting on a draft of this report, FDIC stated that it was pleased to receive unmodified 

opinions for the 32nd consecutive year on the DIF’s and the FRF’s financial statements, and 

noted that we reported that FDIC had effective internal control over financial reporting and that 

there was no reportable noncompliance with tested provisions of applicable laws, regulations, 

contracts, and grant agreements. FDIC also stated that it was pleased to report that it effectively 

remediated a significant deficiency in internal control over contract documentation and contract 

payment review processes. FDIC stated that while its controls have improved, FDIC reiterated 

its commitment to sound financial management and will continue to look for opportunities to 

improve. The complete text of FDIC’s response is reprinted in appendix II. 

M. Hannah Padilla

Director 

Financial Management and Assurance 

February 15, 2024 
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 161 

APPENDIX I
FINANCIAL SECTION

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 162 

APPENDIX II

Federal Deposit Insurance Corporation

550 17th Street NW, Washington, D.C. 20429-9990 Deputy to the Chairman and CFO

February 15, 2024

Ms. M. Hannah Padilla

Director, Financial Management and Assurance

U.S. Government Accountability Office

441 G Street, NW

Washington, D.C. 20548

Re: FDIC Management Response to the 2023 and 2022 Financial Statements Audit Report

Dear Ms. Padilla:

Thank you for the opportunity to review and comment on the U.S. Government Accountability Office’s (GAO's)

draft report titled, Financial Audit: Federal Deposit Insurance Corporation Funds’ 2023 and 2022 Financial 

Statements, GAO-24-106490. We are pleased that the Federal Deposit Insurance Corporation (FDIC) has

received unmodified opinions for the thirty-second consecutive year on the financial statements of its funds:

the Deposit Insurance Fund (DIF) and the FSLIC Resolution Fund (FRF). GAO also reported the FDIC maintained,

in all material respects, effective internal control over financial reporting, and that there was no reportable

noncompliance with provisions of applicable laws, regulations, contracts, and grant agreements that were

tested.

The FDIC is pleased to report that we effectively remediated a significant deficiency in internal control over

contract documentation and contract payment review processes. In 2023, we created targeted training and 

procedures for reviewing and approving contractor invoices; implemented oversight to ensure contracting

policies and procedures are followed and contract documentation is complete and accurate; established the

Division of Administration’s quality assurance group, dedicated to quality review processes; and enhanced

overall the FDIC’s interdivisional monitoring capability. While our controls have improved, I want to reiterate

our commitment to sound financial management and we will continue to look for opportunities to improve.

In complying with audit standards that require management to provide a written assessment about the

effectiveness of its internal control over financial reporting, the FDIC has prepared Management’s Report on

Internal Control over Financial Reporting. The report acknowledges management’s responsibility for

establishing and maintaining internal control over financial reporting and provides the FDIC's conclusion

regarding the effectiveness of its internal control.

We want to thank the GAO staff for their professionalism and dedication during the audit and look forward to

the FDIC continuing our positive and productive relationship during the 2024 audit. If you have any questions or 

concerns, please do not hesitate to contact me.

Sincerely,

Bret D. Edwards

Deputy to the Chairman

 and Chief Financial Officer

BRET

EDWARDS

Digitally signed by 

BRET EDWARDS
VI.

RISK MANAGEMENT

AND INTERNAL CONTROLS
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 164 
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 165 

The FDIC uses several means to identify and address enterprise risks, maintain comprehensive 

internal controls, ensure the overall effectiveness and efficiency of operations, and otherwise 

comply as necessary with the following federal laws and 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 Modernization Act of 2014 (FISMA)

 OMB Circular A-123

 GAO’s Standards for Internal Control in the Federal Government

As a foundation for these efforts, the 

Office of Risk Management and Internal 

Controls (ORMIC) oversees a corporate-wide 

program of risk management and internal 

control activities and works closely with 

FDIC’s Division and Office management. 

The FDIC has made a concerted effort to 

identify and assess financial, reputational, 

and operational risks and incorporate 

corresponding controls into day-to-day 

operations. The program also requires that 

Divisions and Offices document comprehensive procedures, thoroughly train employees, and 

hold supervisors and their employees accountable for performance and results. Divisions 

and Offices monitor compliance through periodic management reviews and various activity 

reports distributed to all levels of management. The FDIC also takes seriously FDIC Office of 

Inspector General and GAO audit recommendations and strives to implement agreed-upon 

actions promptly. The FDIC has received unmodified opinions on its financial statement audits 

for 32 consecutive years, and these and other positive results reflect the effectiveness of the 

overall management control program.

In 2023, the FDIC strengthened acquisition-related controls, expanded internal control testing 

efforts, enhanced the Division of Finance’s internal control program, enhanced the fraud 

reporting structure, and matured our supply chain risk management program. ORMIC will 

continue these efforts in 2024 and will also implement an agency-wide enterprise change 

management program.
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 166 

In September 2023, Stacie Alboum (left) and Jill Lennox (right) spoke at the ERM Risk 

Awareness Symposium.

In September 2023, ORMIC held its second annual ERM Risk Awareness Symposium where FDIC 

risk management experts shared information about significant risks facing the FDIC and how 

the agency is managing and addressing these risks and planning for the future. Presenters 

discussed deposit insurance coverage, IT modernization efforts, the FDIC’s Intelligence and 

Threat Sharing Unit, and the Dodd-Frank Act’s requirements for certain financial firms to 

create “living wills” that describe their strategies for effecting a rapid and orderly resolution in 

the event of material financial distress or failure.

Program Evaluation

ORMIC periodically evaluates selected program areas responsible for achieving FDIC strategic 

objectives and annual performance goals. During 2023, ORMIC evaluated the Division of 

Complex Institution Supervision and Resolution (CISR) processes for achieving the following 

strategic objective and related performance goal from the FDIC’s 2023 Annual Performance 

Plan. The objective and goal evaluated and summary results follow.

Strategic Objective: In the event of the failure of a large, complex financial institution (LCFI), 

the FDIC carries out the resolution in an orderly manner in accordance with statutory 

mandates.

Performance Goal: Continue to build the FDIC’s operational readiness to administer the 

resolution of LCFIs, including those designated as systemically important.
1

RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 167 

Targets: 

) Continue to refine plans and strategic options to ensure the FDIC’s operational 

readiness to administer a resolution of LCFIs; 

2) Continue to deepen and strengthen working relationships with key foreign 

jurisdictions, both on a bilateral basis and through multilateral fora.

The objective of ORMIC’s evaluation was to determine if CISR has processes in place to achieve 

the performance goal and confirm that there is documentary support evidencing that the 

performance goal was met. 

ORMIC reviewed CISR’s 2023 Business Plan; the 2022-2024 FDIC Strategic Plan; output from 

tracking systems used for monitoring implementation of two strategic goals and objectives; 

the Corporate Performance Goal Reporting System; a number of materials supporting 

steps taken to strengthen operational readiness, including the schedule of International 

Engagements – including descriptions, key outputs, and deliverables; the Trilateral PrincipalLevel Exercise (TPLE) Overview Presentation, the TPLE 2023 Senior Staff Communications 

Exercise – Post Exercise Survey Results, and the TPLE 2022 Briefing materials; Financial 

Stability Board Resolution Steering Group (ReSG) membership and Schedule of Meetings 

– including main agenda items; and Risk Assessment Process Questionnaires for Central 

Counterparties (CCP) Survey Responses and Information Needs for CCP Resolution Planning.

ORMIC held meetings with senior officials and staff from CISR’s Operations Branch, and 

leveraged familiarity with CISR operations from ongoing risk management and internal 

control-related collaboration activities. 

ORMIC evaluated CISR’s processes related to this performance goal and noted that processes 

were in place to:

 Track goal milestones through completion;

 Track overall goals and objectives and CISR-led FDIC Performance Goals on a biweekly and quarterly basis, respectively;

 Continue to improve resolution planning by identifying and addressing gaps;

 Continue to engage with key stakeholders from domestic regulatory authorities, 

as well as foreign jurisdictions, and conduct simulation exercises to further 

support readiness;

 Hold TPLEs and information exchanges resulting in policy discussions, 

development of playbooks, and resolution strategies; and 

 Hold TPLE Senior Staff Communications Exercises – with Post Exercise Survey 

Results.

ORMIC validated the processes in place by reviewing a variety of documents and deliverables, 

including the ReSG schedule of meetings, schedule of international engagements, agendas 

and agenda items, lists of participants, and outputs from the tracking systems. ORMIC 
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 168 

concluded that CISR has effective processes in place to achieve this performance goal and 

related targets for building and maintaining the FDIC’s operational readiness to administer the 

resolution of LCFIs. 

Additionally, ORMIC reviewed the OIG’s recent evaluation entitled The FDIC’s Orderly 

Liquidation Authority. CISR is currently addressing recommendations made by the OIG in their 

evaluation report to supplement the FDIC’s resolution readiness capabilities. ORMIC tracks 

OIG recommendations and corrective actions through implementation and closure.

Internal Control Program – Fraud Risk Management

The FDIC’s enterprise risk management and internal control program considers the potential 

for fraud and incorporates elements of Principle 8—Assess Fraud Risk—from the GAO’s 

Standards for Internal Control in the Federal Government.

21 The FDIC implemented a Fraud Risk 

Assessment Framework as a basis for identifying potential financial fraud risks and schemes 

and ensuring that preventive and detective controls are present and working as intended. 

Examples of transactions more susceptible to fraud include contractor payments, wire 

transfers, travel card purchases, and cash receipts.

As part of the framework, management identifies potential fraud areas and implements and 

evaluates key controls as proactive measures to prevent fraud. Although no system of internal 

control provides absolute assurance, the FDIC’s system of internal control provides reasonable 

assurance that key controls are adequate and working as intended. Monitoring activities 

include supervisory approvals, management reporting, and exception reporting.

FDIC management performs due diligence in areas of suspected or alleged fraud. In addition, 

the FDIC promptly refers instances of suspected fraud to the Office of Inspector General for 

investigation. FDIC continues to maintain a robust internal control environment designed to 

deter and detect fraud.

Management Report on Final Actions

As required under the provisions of Section 5 of the Inspector General Act of 1978, as 

amended, 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 actions taken 

by management on audit reports for the federal fiscal year period October 1, 2022, through 

September 30, 2023.

21 GAO’s Standards for Internal Control in the Federal Government is available at https://www.gao.gov/products/gao14-704g.
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 169 

Table 1: 

Management Report on Final Action on Audits with Disallowed Costs 

for Fiscal Year 2023

(There were no audit reports in this category.)

Table 2: 

Management Report on Final Action on Audits with Recommendations to 

Put Funds to Better Use for Fiscal Year 2023

Dollars in Thousands

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 $1,500

C. Total reports pending final action during the period (A and B) 1 $1,500

D. Final action taken during the period: 0 $0

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 

(September 30, 2023)

* Note, the OIG closed this recommendation on 

December 4, 2023.

1 $1,500
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 170 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

EVAL-20-001

10/28/2019

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating 

Officer provide enhanced 

contract portfolio reports 

to FDIC executives, senior 

management, and the

Board Directors.

The Division of Administration 

(DOA)’s Acquisition Services

Branch (ASB) has identified 

the specific contract portfolio 

reporting enhancements

that would be useful to FDIC 

executives, senior management,

and the Board of Directors; 

and is determining the extent 

to which such reporting is 

producible using existing data 

and technology. DOA is working 

to identify reliable and efficient 

data sources to meet reporting 

needs.

Due Date: 6/30/2024

$0

EVAL-21-002

3/31/2021

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating Officer 

implement periodic reviews

for procured Critical

Functions, including for the

Basic Ordering Agreements

(BOAs) and task orders for 

Managed Security Services 

Provider and Security and 

Privacy Professional Services.

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating Officer 

determine when and how 

to assess for contractor 

overreliance as part of the 

management oversight 

strategy.

Status: Subsequently closed.

Status: Subsequently closed.

$0
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 171 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023 (continued)

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

EVAL-21-002

3/31/2021

(Continued)

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating Officer 

implement corrective actions

when the FDIC determines it 

is over-reliant on a contractor 

for a procured Critical 

Function.

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating Officer 

report to the Board about 

the Procurement Risk 

Assessments, Management

Oversight Strategies, 

and contract provisions 

that address identified 

risks for planned Critical

Functions during the 

procurement planning phase 

of the acquisition, for its 

consideration.

OIG recommends that the 

Deputy to the Chairman 

and Chief Operating Officer 

report to the Board about 

the Contract Award Profile 

Reports and corresponding 

status reports for procured

Critical Functions during

the contract management

phase of the acquisition 

process on an individual and 

aggregate contract basis, for 

its consideration.

Status: Subsequently closed.

DOA ASB implemented its 

template for essential contracts 

and revised its Acquisition

Procedures and Guidance 

Manual (APGM) accordingly. DOA 

ASB is working to incorporate 

essential contracts into its 

report to the Board. Efforts are 

being made to include essential 

contracts in the Board Report 

for the fourth quarter of 2023.

Due Date: 3/31/2024

DOA ASB implemented its 

template for essential contracts 

and revised its Acquisition

Procedures and Guidance 

Manual (APGM) accordingly. DOA 

ASB is working to incorporate 

essential contracts into its 

report to the Board. Efforts are 

being made to include essential 

contracts in the Board Report 

for the fourth quarter of 2023.

Due Date: 3/31/2024
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 172 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023 (continued)

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

REV-22-001

1/4/2022

We recommend that the 

Deputy to the Chairman, Chief 

Operating Officer, and Chief of 

Staff, in coordination with the 

General Counsel, develop and 

implement procedures for the 

FDIC to ensure contractors 

carry out their obligations 

under the Whistleblower 

Rights Notification Clause, 

including methods for

verification that (1) all 

contractor and subcontractor

employees of the FDIC are 

notified of their whistleblower 

rights and protections, and 

(2) clauses are appropriately

included in subcontracts.

DOA ASB issued its Procurement 

Administrative Bulletin (PAB) 

2022-07, Contractor Employee 

Whistleblower Rights, dated 

December 9, 2022. The PAB 

revises the clause to inform 

employees of Whistleblower 

Rights and requires the 

contractor and subcontractor to 

distribute a brochure pertaining

to whistleblower information to 

employees working in support 

of the contract. Additional time 

is needed to add a certification 

requirement, which must be 

submitted through a lengthy 

process involving posting it in 

the Federal Register.

Due Date: 8/31/2024

$0

AUD-22-003

1/18/2022

We recommend that the 

Director, RMS, coordinate with 

the Legal Division to establish

and implement procedures

for RMS threat information 

sharing activities.

RMS is addressing this corrective 

action together with a similar 

recommendation that was 

issued in the Sharing of Threat 

and Vulnerability Information

with Financial Institutions

report (EVAL-23-002) on 

August 29, 2023.

Due Date: 3/31/2024

$0
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 173 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023 (continued)

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

EVAL-22-003

3/1/2022

We recommend that the 

FDIC Senior Accountable 

Official for SCRM (Deputy 

to the Chairman and Chief 

Financial Officer) establish

and implement metrics and

indicators to continuously 

monitor and evaluate supply 

chain risks at the FDIC.

We recommend that the Chief 

Information Security Officer

implement SCRM controls of 

the NIST Risk Management 

Framework (RMF) for IT 

procurements.

Status: Recommendation 

closure package was submitted 

to the OIG.

Due Date: 12/31/2023

The FDIC has selected the 

appropriate security controls

from the SCRM control family 

from NIST SP 800-53 Rev 5. 

The SCRM team is coordinating 

across Divisions and Offices

to implement the controls. 

Additional time is needed 

for Divisions and Offices to

implement the selected SCRM 

controls, but staff anticipates 

this will be completed by the end 

of the first quarter of 2024.

Due Date: 3/31/2024

$0
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 174 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023 (continued)

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

EVAL-22-003

3/1/2022

(Continued)

We recommend that the FDIC 

Senior Accountable Official

for SCRM (Deputy to the 

Chairman and Chief Financial

Officer) in cooperation 

with the Deputy to the 

Chairman, Chief Operating

Officer, and Director, 

Division of Administration

develop and implement a 

process and procedures for 

conducting supply chain risk 

assessments.

We recommend that the FDIC 

Senior Accountable Official

for SCRM (Deputy to the 

Chairman and Chief Financial

Officer) in cooperation with 

the Deputy to the Chairman, 

Chief Operating Officer, 

and Director, Division of 

Administration: conduct 

supply chain risk assessments 

prior to entering into 

contracts with new

suppliers/vendors.

Status: Recommendation 

closure package was submitted 

to the OIG.

Due Date: 12/31/2023

Status: Recommendation 

closure package was submitted 

to the OIG.

Due Date: 12/31/2023
RISK MANAGEMENT AND INTERNAL CONTROLS

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 175 

Table 3: 

Audit Reports Without Final Actions but with Management Decisions 

over One Year Old for Fiscal Year 2023 (continued)

Report No. and 

Issue Date OIG Audit Recommendation Management Action

Disallowed 

Costs

EVAL-22-003

3/1/2022

(Continued)

We recommend that the FDIC 

Senior Accountable Official

for SCRM (Deputy to the 

Chairman and Chief Financial

Officer) in cooperation with 

the Deputy to the Chairman, 

Chief Operating Officer, 

and Director, Division of 

Administration: conduct 

supply chain risk assessments 

prior to substantive contract 

actions, including renewals,

extensions, and exercising

option periods.

Status: Recommendation 

closure package was submitted 

to the OIG.

Due Date: 12/31/2023

AUD-22-004

9/27/2022

We recommend that the CIO 

address the 31 Plan of Action 

and Milestones (POA&Ms) 

identified as of June 21, 2022, 

associated with NIST SP 800-

53 Rev. 5 control SI-2 (Flaw 

Remediation).

The Acceptance of Risk for 

eight POA&Ms expired. The 

FDIC decided not to renew 

the Acceptance of Risk and 

instead focus on remediation. 

Additional time is needed to 

address the remaining POA&Ms 

due to competing priorities. 

Due Date: 10/31/2024

$0
PAGE INTENTIONALLY LEFT BLANK
VII.

APPENDICES
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 178 

FDIC Actions on Financial Institutions Applications 

2023 2022 2021

Deposit Insurance 5 17 15

Approved1 5 17 15

Denied 0 0 0

New Branches 398 481 493

Approved 398 481 493

Denied 0 0 0

Mergers 116 133 187

Approved 116 133 187

Denied 0 0 0

Requests for Consent to Serve2 61 52 47

Approved 58 50 47

 Section 19 0 6 5

Section 32 58 44 42

Denied 3 2 0

 Section 19 0 0 0

Section 32 3 2 0

Notices of Change in Control 15 23 34

Letters of Intent Not to Disapprove 15 22 34

Disapproved 0 1 0

Brokered Deposit Waivers 11 1 1

Approved 11 0 1

Denied 0 1 0

Savings Association Activities3 0 0 0

Approved 0 0 0

Denied 0 0 0

State Bank Activities/Investments4 13 25 25

Approved 13 25 25

Denied 0 0 0

Conversion of Mutual Institutions 4 4 4

Non-Objection 4 4 4

Objection 0 0 0

1 Includes deposit insurance applications 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 28 of the FDI Act, in general, prohibits a federally-insured state savings association from engaging in an activity not 

permissible for a federal savings association and requires notices or applications to be filed with the FDIC.

4 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 or applications to be filed with the FDIC.

A. Key Statistics
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 179 

Combined Risk and Consumer Enforcement Actions 

2023 2022 2021

Total Number of Actions Initiated by the FDIC 117 118 99

Termination of Insurance 12 16 7

Involuntary Termination 0 0 0

 Sec. 8a for Violations, Unsafe/Unsound Practices or Conditions 0 0 0

Voluntary Termination 12 16 7

 Sec. 8a by Order Upon Request 0 0 0

 Sec. 8p No Deposits 11 14 6

 Sec. 8q Deposits Assumed 1 2 1

Sec. 8b Consent and Cease-and-Desist Actions 28 19 10

 Notices of Charges Issued 4 0 1

 Orders to Pay Restitution 0 0 0

 Consent and Cease and Desist Orders 22 17 8

 Personal Cease and Desist Orders 2 2 1

Sec. 8e Removal/Prohibition of Director or Officer 43 28 25

 Notices of Intention to Remove/Prohibit 4 3 4

 Consent Orders 39 25 21

Sec. 8g Suspension/Removal When Charged With Crime 0 0 0

Civil Money Penalty Actions 28 27 30

 Sec. 7a Call Report Penalty Orders 0 0 0

 Sec. 8i Flood Act Civil Money Penalty Orders 24 24 26

 Sec. 8i Civil Money Penalty Notices of Assessment 4 3 4

Sec. 10c Orders of Investigation 4 8 2

Sec. 19 Waiver Orders 1 20 24

 Approved Section 19 Waiver Orders 1 20 24

 Denied Section 19 Waiver Orders 0 0 0

Sec. 32 Notices Disapproving Officer/Director’s Request for Review 0 0 0

Truth-in-Lending Act Reimbursement Actions 31 41 44

 Denials of Requests for Relief 0 0 0

 Grants of Relief 0 0 0

 Banks Making Reimbursement1 31 41 44

Suspicious Activity Reports (Open and closed institutions)1 407,304 421,118 360,121

Other Actions Not Listed2 1 0 1

1 These actions do not constitute the initiation of a formal enforcement action and, therefore, are not included in the total 

number of actions initiated.

2 The Other Actions Not Listed were, in 2023: 1 Order Dismissing Notice of Assessment of Civil Money Penalty and Order to Pay; in 

2022: 0; in 2021: 1 Supervisory Prompt Corrective Action Directive.
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 180 

FDIC Insured Institutions Closed During 2023

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

Estimated 

Loss to 

the DIF2

Date of 

Closing or 

Acquisition

Receiver/

Assuming Bank 

and Location

Purchase and Assumption - All Deposits

Silicon Valley Bank

Santa Clara, CA

SM 165,226 $209,026,000 $175,378,000 $2,618,2393 3/10/2023 First–Citizens Bank & 

Trust Company

Raleigh, North Carolina.

Signature Bank

New York, NY

NM 175,044 $110,363,650 $88,612,911 $602,2753 3/12/2023 Flagstar Bank, 

National Association, 

Hicksville, New York 

Citizens Bank

Sac City, IA

NM 1,965 $60,448 $52,311 $14,804 11/3/2023 Iowa Trust & 

Savings Bank

Emmetsburg, Iowa

Whole Bank Purchase and Assumption - All Deposits

First Republic Bank

San Francisco, CA

NM 1,095,457 $212,638,872 $176,436,706 $16,657,086 5/1/2023 JPMorgan Chase Bank, 

National Association, 

Columbus, Ohio 

Heartland 

Tri-State Bank

Elkhart, KS

SM 5,404 $139,446 $130,110 $54,167 7/28/2023 Dream First Bank, 

National Association

Syracuse, Kansas

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, 2023. 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. 

3 The estimated losses for Silicon Valley Bank and Signature Bank exclude $20.4 billion of estimated losses for uninsured deposits pursuant to a systemic 

risk exception.
Estimated Insured Deposits and the Deposit Insurance Fund, 

December 31, 1934, through September 30, 20231

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

2023 $250,000 $17,213,780 $10,592,562 61.5 $119,339.0 0.69 1.13

2022 250,000 17,778,221 10,265,997 57.7 128,218.0 0.72 1.25

2021 250,000 18,237,236 9,923,221 54.4 123,141.0 0.68 1.24

2020 250,000 16,339,026 9,103,253 55.7 117,896.8 0.72 1.30

2019 250,000 13,262,843 7,828,163 59.0 110,346.9 0.83 1.41

2018 250,000 12,659,406 7,525,204 59.4 102,608.9 0.81 1.36 

2017 250,000 12,129,503 7,154,379 59.0 92,747.5 0.76 1.30 

2016 250,000 11,693,371 6,915,663 59.1 83,161.5 0.71 1.20

2015 250,000 10,952,922 6,518,675 59.5 72,600.2 0.66 1.11

2014 250,000 10,410,687 6,195,554 59.5 62,780.2 0.60 1.01

2013 250,000 9,825,479 5,998,238 61.0 47,190.8 0.48 0.79

2012 250,000 9,474,720 7,402,053 78.1 32,957.8 0.35 0.45

2011 250,000 8,782,291 6,973,483 79.4 11,826.5 0.13 0.17

2010 250,000 7,887,858 6,301,542 79.9 (7,352.2) (0.09) (0.12)

2009 250,000 7,705,354 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 6,229,753 3,890,930 62.5 48,596.6 0.78 1.25 

2004 100,000 5,724,621 3,622,059 63.3 47,506.8 0.83 1.31

2003 100,000 5,223,922 3,452,497 66.1 46,022.3 0.88 1.33 

2002 100,000 4,916,078 3,383,598 68.8 43,797.0 0.89 1.29 

2001 100,000 4,564,064 3,215,581 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

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 181 
Estimated Insured Deposits and the Deposit Insurance Fund, 

December 31, 1934, through September 30, 20231 (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 Domestic 

Deposits

Deposit

Insurance

Fund

Total

Domestic 

Deposits

Est. Insured

Deposits

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

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

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 182 
Estimated Insured Deposits and the Deposit Insurance Fund, 

December 31, 1934, through September 30, 20231

 (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 Domestic 

Deposits

Deposit 

Insurance

Fund

Total

Domestic 

Deposits

Est. Insured

Deposits

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 

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 2023, 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 2023, figures are for DIF. Amounts for 1989-2023 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 (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.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 183 
Income and Expenses, Deposit Insurance Fund, from Beginning of Operations, 

September 11, 1933, through December 31, 2023 

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 $323,111.6 $246,497.3 $12,157.2 $88,771.5 $201,599.9 $147,010.0 $42,807.4 $11,782.6 $139.5 $121,651.2

2023 35,995.8 33,188.03 0.0 2,807.8 0.0614% 45,374.7 40,950.83 2,126.0 2,297.9 0.0 (9,378.9)

2022 9,606.7 8,310.8 0.0 $1,295.9 0.0396% 1,803.5 (82.9) 1,882.9 3.5 0.0 7,803.2

2021 8,153.4 7,080.2 0.0 1,073.2 0.0356% 1,705.3 (143.7) 1,842.7 6.3 0.0 6,448.1

2020 8,796.5 7,153.9 60.7 $1,703.3 0.0395% 1,691.9 (157.3) 1,846.5 2.7 0.0 7,104.6

2019 7,095.3 5,642.7 703.6 2,156.2 0.0312% 513.2 (1,285.5) 1,795.6 3.1 0.0 6,582.1

2018 11,170.8 9,526.7 0.0 1,644.1 0.0626% 1,205.2 (562.6) 1,764.7 3.1 0.0 9,965.6

2017 11,663.7 10,594.8 0.0 1,068.9 0.0716% 1,558.2 (183.1) 1,739.4 2.0 0.0 10,105.5

2016 10,674.1 9,986.6 0.0 687.5 0.0699% 150.6 (1,567.9) 1,715.0 3.5 0.0 10,523.5

2015 9,303.5 8,846.8 0.0 456.7 0.0647% (553.2) (2,251.3) 1,687.2 10.9 0.0 9,856.7

2014 8,965.1 8,656.1 0.0 309.0 0.0663% (6,634.7) (8,305.5) 1,664.3 6.5 0.0 15,599.8

2013 10,458.9 9,734.2 0.0 724.7 0.0775% (4,045.9) (5,659.4) 1,608.7 4.8 0.0 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) 0.0 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) 0.0 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) 0.0 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 0.0 (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 0.0 (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 0.0 2,105.3

2006 2,643.5 31.9 0.0 2,611.6 0.0005% 904.3 (52.1) 950.6 5.8 0.0 1,739.2

2005 2,420.5 60.9 0.0 2,359.6 0.0010% 809.3 (160.2) 965.7 3.8 0.0 1,611.2

2004 2,240.3 104.2 0.0 2,136.1 0.0019% 607.6 (353.4) 941.3 19.7 0.0 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 0.0 2,241.3

2002 2,384.7 107.8 0.0 2,276.9 0.0023% 719.6 (243.0) 945.1 17.5 0.0 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 0.0 (393.3)

2000 2,570.1 64.3 0.0 2,505.8 0.0016% 945.2 28.0 883.9 33.3 0.0 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 0.0 369.7

1998 2,584.6 37.0 0.0 2,547.6 0.0010% 817.5 (5.7) 782.6 40.6 0.0 1,767.1

1997 2,165.5 38.6 0.0 2,126.9 0.0011% 247.3 (505.7) 677.2 75.8 0.0 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 0.0 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 0.0 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 0.0 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 0.0 14,098.9

1992 6,479.3 5,758.6 0.0 720.7 0.1815% (596.8) (2,274.7) 614.84 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)

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 184 
Income and Expenses, Deposit Insurance Fund, from Beginning of Operations, 

September 11, 1933, through December 31, 2023 (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)

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 0.0 (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 0.0 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) 0.0 296.4 

1985 3,385.5 1,433.5 0.0 1,952.0 0.0815% 1,957.9 1,569.0 179.2 209.7 0.0 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 0.0 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 0.0 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 0.0 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 0.0 1,226.6 

1980 1,310.4 951.9 521.1 879.6 0.0370% 83.6 (38.1) 118.2 3.5 0.0 1,226.8 

1979 1,090.4 881.0 524.6 734.0 0.0333% 93.7 (17.2) 106.8 4.1 0.0 996.7

1978 952.1 810.1 443.1 585.1 0.0385% 148.9 36.5 103.3 9.1 0.0 803.2 

1977 837.8 731.3 411.9 518.4 0.0370% 113.6 20.8 89.3 3.5 0.0 724.2

1976 764.9 676.1 379.6 468.4 0.0370% 212.3 28.0 180.45 3.9 0.0 552.6 

1975 689.3 641.3 362.4 410.4 0.0357% 97.5 27.6 67.7 2.2 0.0 591.8

1974 668.1 587.4 285.4 366.1 0.0435% 159.2 97.9 59.2 2.1 0.0 508.9

1973 561.0 529.4 283.4 315.0 0.0385% 108.2 52.5 54.4 1.3 0.0 452.8 

1972 467.0 468.8 280.3 278.5 0.0333% 65.7 10.1 49.6 6.06 0.0 401.3

1971 415.3 417.2 241.4 239.5 0.0345% 60.3 13.4 46.9 0.0 0.0 355.0 

1970 382.7 369.3 210.0 223.4 0.0357% 46.0 3.8 42.2 0.0 0.0 336.7

1969 335.8 364.2 220.2 191.8 0.0333% 34.5 1.0 33.5 0.0 0.0 301.3

1968 295.0 334.5 202.1 162.6 0.0333% 29.1 0.1 29.0 0.0 0.0 265.9 

1967 263.0 303.1 182.4 142.3 0.0333% 27.3 2.9 24.4 0.0 0.0 235.7

1966 241.0 284.3 172.6 129.3 0.0323% 19.9 0.1 19.8 0.0 0.0 221.1 

1965 214.6 260.5 158.3 112.4 0.0323% 22.9 5.2 17.7 0.0 0.0 191.7

1964 197.1 238.2 145.2 104.1 0.0323% 18.4 2.9 15.5 0.0 0.0 178.7

1963 181.9 220.6 136.4 97.7 0.0313% 15.1 0.7 14.4 0.0 0.0 166.8

1962 161.1 203.4 126.9 84.6 0.0313% 13.8 0.1 13.7 0.0 0.0 147.3

1961 147.3 188.9 115.5 73.9 0.0323% 14.8 1.6 13.2 0.0 0.0 132.5 

1960 144.6 180.4 100.8 65.0 0.0370% 12.5 0.1 12.4 0.0 0.0 132.1 

1959 136.5 178.2 99.6 57.9 0.0370% 12.1 0.2 11.9 0.0 0.0 124.4

1958 126.8 166.8 93.0 53.0 0.0370% 11.6 0.0 11.6 0.0 0.0 115.2 

1957 117.3 159.3 90.2 48.2 0.0357% 9.7 0.1 9.6 0.0 0.0 107.6

1956 111.9 155.5 87.3 43.7 0.0370% 9.4 0.3 9.1 0.0 0.0 102.5

1955 105.8 151.5 85.4 39.7 0.0370% 9.0 0.3 8.7 0.0 0.0 96.8 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 185 
Income and Expenses, Deposit Insurance Fund, from Beginning of Operations, 

September 11, 1933, through December 31, 2023 (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)

1954 99.7 144.2 81.8 37.3 0.0357% 7.8 0.1 7.7 0.0 0.0 91.9

1953 94.2 138.7 78.5 34.0 0.0357% 7.3 0.1 7.2 0.0 0.0 86.9 

1952 88.6 131.0 73.7 31.3 0.0370% 7.8 0.8 7.0 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 0.0 76.9

1950 84.8 122.9 68.7 30.6 0.0370% 7.8 1.4 6.4 0.0 0.0 77.0

1949 151.1 122.7 0.0 28.4 0.0833% 6.4 0.3 6.1 0.0 0.0 144.7

1948 145.6 119.3 0.0 26.3 0.0833% 7.0 0.7 6.37 0.0 0.0 138.6 

1947 157.5 114.4 0.0 43.1 0.0833% 9.9 0.1 9.8 0.0 0.0 147.6

1946 130.7 107.0 0.0 23.7 0.0833% 10.0 0.1 9.9 0.0 0.0 120.7

1945 121.0 93.7 0.0 27.3 0.0833% 9.4 0.1 9.3 0.0 0.0 111.6

1944 99.3 80.9 0.0 18.4 0.0833% 9.3 0.1 9.2 0.0 0.0 90.0 

1943 86.6 70.0 0.0 16.6 0.0833% 9.8 0.2 9.6 0.0 0.0 76.8

1942 69.1 56.5 0.0 12.6 0.0833% 10.1 0.5 9.6 0.0 0.0 59.0

1941 62.0 51.4 0.0 10.6 0.0833% 10.1 0.6 9.5 0.0 0.0 51.9

1940 55.9 46.2 0.0 9.7 0.0833% 12.9 3.5 9.4 0.0 0.0 43.0 

1939 51.2 40.7 0.0 10.5 0.0833% 16.4 7.2 9.2 0.0 0.0 34.8 

1938 47.7 38.3 0.0 9.4 0.0833% 11.3 2.5 8.8 0.0 0.0 36.4 

1937 48.2 38.8 0.0 9.4 0.0833% 12.2 3.7 8.5 0.0 0.0 36.0 

1936 43.8 35.6 0.0 8.2 0.0833% 10.9 2.6 8.3 0.0 0.0 32.9 

1935 20.8 11.5 0.0 9.3 0.0833% 11.3 2.8 8.5 0.0 0.0 9.5

1933-

34 7.0 0.0 0.0 7.0 N/A 10.0 0.2 9.8 0.0 0.0 (3.0)

1

 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 average assessment base. Figures represent only BIF-insured institutions prior 

to 1990, and BIF- and SAIF-insured institutions from 1990 through 2005. After 1995, all thrift closings became the responsibility of the FDIC and amounts are reflected in 

the SAIF. Beginning in 2006, figures are for the DIF.

The annualized assessment rate for 2023 is based on full year assessment income divided by a four quarter average of 2023 quarterly assessment base amounts. The 

assessment base for fourth quarter 2023 was estimated using the third quarter 2023 assessment base and an assumed quarterly growth rate of one percent.

Historical Assessment Rates:

1934 – 1949 The statutory assessment rate was 0.0833 percent.

1950 – 1984 The effective assessment rates varied from the statutory rate of 0.0833 percent due to assessment credits provided in those years.

1985 – 1989 The statutory assessment rate was 0.0833 percent (no credits were given).

1990 The statutory rate increased to 0.12 percent.

1991 – 1992 The statutory rate increased to a minimum of 0.15 percent. The effective rates in 1991 and 1992 varied because the FDIC exercised new authority to 

increase assessments above the statutory minimum rate when needed.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 186 
1993 – 2006 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.

2007 – 2008 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.

2009 – 2011 For the first quarter of 2009, assessment rates were increased to a range of 0.12 percent 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 insured 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 percent and 0.45 percent of assessable deposits. Initial rates were 

subject to further adjustments.

2011 – 2016 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 percent 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 shown in the table).

2016 Beginning July 1, 2016, initial assessment rates were lowered from a range of 5 basis points to 35 basis points to a range of 3 basis points to 30 basis 

points, and an additional surcharge was imposed on large banks (generally institutions with $10 billion or more in assets) of 4.5 basis points of their 

assessment base (after making adjustments).

2018 The 4.5 basis point surcharge imposed on large banks ended effective October 1, 2018. The annualized assessment rates averaged approximately 7.2 

cents per $100 of the assessable base for the first three quarters of 2018 and 3.5 cents per $100 of the assessment base for the last quarter of 2018. The 

full year annualized assessment rate averaged 6.3 cents per $100 (which is shown in the table).

2019 Assessment income for 2019 was reduced by small bank credits of $703.6 million.

2020 Assessment income for 2020 was reduced by small bank credits of $60.7 million.

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 128 of this report shows the aggregate (corporate and receivership) 

expenditures of the FDIC.

3 Assessment Income and Provision for Ins. Losses include revenue and estimated losses of $20.4 billion for coverage of uninsured deposits pursuant to systemic 

risk exceptions.

4 Includes $210 million for the cumulative effect of an accounting change for certain postretirement benefits (1992).

5 Includes a $106 million net loss on government securities (1976).

6 This amount represents interest and other insurance expenses from 1933 to 1972.

7 Includes the aggregate amount of $81 million of interest paid on capital stock between 1933 and 1948.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 187 
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 188 

Assets and Deposits of Failed or Assisted Insured Institutions and 

Losses to the Deposit Insurance Fund, 1934 - 2023

Dollars in Thousands

Bank and Thrift Failures1

Year2

Number 

of Banks/

Thrifts

Total 

Assets3

Total 

Deposits3

Losses to 

the Fund4

2,636 $1,479,535,581 $1,154,472,610 $124,416,688

2023 5 $532,228,416 $440,610,038 $19,946,5535

2022 0 0 0 0 

2021 0 0 0 0 

2020 4 454,986 437,138 91,011 

2019 4 208,767 $190,547 25,260

2018 0 0 0 0 

2017 8 5,081,737 4,683,360 1,078,967

2016 5 277,182 268,516 42,474 

2015 8 6,706,038 4,870,464 857,273

2014 18 2,913,503 2,691,485 378,362

2013 24 6,044,051 5,132,246 1,202,763 

2012 51 11,617,348 11,009,630 2,377,369

2011 92 34,922,997 31,071,862 6,389,947

20106 157 92,084,988 78,290,185 15,781,132

20096 140 169,709,160 137,835,208 25,863,181

20086 25 371,945,480 234,321,715 17,754,594 

2007 3 2,614,928 2,424,187 157,440

2006 0 0 0 0

2005 0 0 0 0

2004 4 170,099 156,733 3,917 

2003 3 947,317 901,978 62,647 

2002 11 2,872,720 2,512,834 413,989 

2001 4 1,821,760 1,661,214 292,465 

2000 7 410,160 342,584 32,138 

1999 8 1,592,189 1,320,573 586,027 

1998 3 290,238 260,675 221,606 

1997 1 27,923 27,511 5,026 

1996 6 232,634 230,390 60,615 

1995 6 802,124 776,387 84,472 

1994 13 1,463,874 1,397,018 179,051 

1993 41 3,828,939 3,509,341 632,646 

1992 120 45,357,237 39,921,310 3,674,149 

1991 124 64,556,512 52,972,034 6,001,595 

1990 168 16,923,462 15,124,454 2,771,489 

1989 206 28,930,572 24,152,468 6,195,286 

1988 200 38,402,475 26,524,014 5,377,497 

1987 184 6,928,889 6,599,180 1,862,492 

1986 138 7,356,544 6,638,903 1,682,538 

1985 116 3,090,897 2,889,801 648,179 

1934 - 1984 729 16,719,435 12,716,627 1,682,538
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 189 

Assistance Transactions

Assets and Deposits of Failed or Assisted Insured Institutions and 

Losses to the Deposit Insurance Fund, 1934 - 2023 (continued)

Dollars in Thousands

Year2

Number 

of Banks/

Thrifts

Total 

Assets3

Total 

Deposits3

Losses to 

the Fund4

154 $3,317,099,253 $1,442,173,417 $5,430,481

2010 - 2023 0 0 0 0

20097 8 1,917,482,183 1,090,318,282 0 

20087 5 1,306,041,994 280,806,966 0 

1993 - 2007 0 0 0 0 

1992 2 33,831 33,117 250 

1991 3 78,524 75,720 3,024 

1990 1 14,206 14,628 2,338 

1989 1 4,438 6,396 2,296 

1988 80 15,493,939 11,793,702 1,540,642 

1987 19 2,478,124 2,275,642 160,164 

1986 7 712,558 585,248 93,179 

1985 4 5,886,381 5,580,359 359,056 

1984 2 40,470,332 29,088,247 1,116,275 

1983 4 3,611,549 3,011,406 337,683 

1982 10 10,509,286 9,118,382 1,042,784 

1981 3 4,838,612 3,914,268 772,790 

1980 1 7,953,042 5,001,755 0 

1934 - 1979 4 1,490,254 549,299 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 2023, figures are for the DIF.

3 Assets and deposit data are based on the last Call Report or TFR filed before failure.

4 Losses to the fund include final and estimated losses. Final losses represent actual losses for unreimbursed subrogated claims 

of inactivated receiverships. Estimated losses generally 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. 

5 Excludes estimated losses of $20.4 billion for uninsured deposits pursuant to a systemic risk exception.

6 Includes amounts related to transaction account coverage under the Transaction Account Guarantee Program (TAG). The 

estimated losses as of December 31, 2023, for TAG accounts in 2010, 2009, and 2008 are $362 million, $1.1 billion, and $12 

million, respectively.

7

 Includes institutions where assistance was provided under a systemic risk determination.
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 190 

Martin J. Gruenberg 

Martin J. Gruenberg was sworn in as Chairman of the FDIC Board 

of Directors on January 5, 2023. He has been a member of the FDIC 

Board since August 2005 and previously served as Vice Chairman 

from August 2005 to July 2011 and as Chairman from November 

2012 to mid-2018. Mr. Gruenberg has also served as Acting 

Chairman on a number of occasions.

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. He also served as Staff Director of the Banking Committee’s 

Subcommittee on International Finance and Monetary Policy from 1987 to 1992.

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. In addition, Mr. 

Gruenberg served as Chairman of the Federal Financial Institutions Examination Council from 

April 2017 to June 2018.

Since June 2019, Mr. Gruenberg has served as Chairman of the Board of Directors of the 

Neighborhood Reinvestment Corporation (NeighborWorks America), and he has been a 

member of that Board since April 2018.

Beginning February 15, 2022, Mr. Gruenberg assumed the role of Chairman of the Resolution 

Steering Group (ResG) of the Financial Stability Board.

Mr. Gruenberg holds a J.D. from Case Western Reserve Law School and an A.B. from Princeton 

University, Princeton School of Public and International Affairs.

B. More About the FDIC

FDIC BOARD OF DIRECTORS
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 191 

Travis Hill

Travis Hill was sworn in as the Vice Chairman of the FDIC Board 

of Directors on January 5, 2023. Previously, he worked at the 

FDIC from 2018 to 2022, as Deputy to the Chairman for Policy 

and before that as Senior Advisor to the Chairman. In these 

roles, among other responsibilities, he oversaw and coordinated 

regulatory and policy initiatives at the agency and advised the 

Chairman on regulatory and policy matters.

Prior to joining the FDIC, Mr. Hill served as Senior Counsel at 

the United States Senate Committee on Banking, Housing, and 

Urban Affairs, where he worked from 2013 to 2018. In this role, he 

participated extensively in the drafting and negotiating of numerous bipartisan bills. Before 

working at the Senate, he worked as a policy analyst at Regions Financial Corporation from 

2011 to 2013.

Mr. Hill received a Bachelor of Science from Duke University, where he studied economics and 

political science, and a Juris Doctor from Georgetown University Law Center.

Jonathan McKernan

Jonathan McKernan was sworn in as a member of the FDIC Board 

of Directors on January 5, 2023. Mr. McKernan previously was a 

Counsel to Ranking Member Pat Toomey (R-PA) on the staff of the 

Senate Committee on Banking, Housing, and Urban Affairs from 

2021 to 2022. He also served as a Senior Counsel at the Federal 

Housing Finance Agency from 2019 to 2021, a Senior Policy 

Advisor at the Department of the Treasury from 2018 to 2019, and 

a Senior Financial Policy Advisor to Senator Bob Corker (R-TN) 

from 2017 to 2018.

Prior to his government service, from 2007 to 2017, Mr. McKernan 

was an attorney in private practice focused on matters under the banking and consumer 

financial laws.

Mr. McKernan holds a Bachelor of Arts and Master of Arts in economics from the University of 

Tennessee and a Juris Doctor with High Honors from the Duke University School of Law.
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 192 

Michael J. Hsu 

Michael Hsu became Acting Comptroller of the Currency on 

May 10, 2021.

As Acting Comptroller of the Currency, Mr. Hsu is the administrator 

of the federal banking system and chief executive officer of 

the Office of the Comptroller of the Currency (OCC). The OCC 

ensures that the federal banking system operates in a safe 

and sound manner, provides fair access to financial services, 

treats customers fairly, and complies with applicable laws and 

regulations. It supervises nearly 1,100 national banks, federal 

savings associations, and federal branches and agencies of 

foreign banks that serve consumers, businesses, and communities across the United States. 

These banks range from community banks to the nation’s largest, most internationally active 

banks.

The Comptroller also serves as a Director of the Federal Deposit Insurance Corporation and 

a member of the Financial Stability Oversight Council and the Federal Financial Institutions 

Examination Council.

Prior to joining the OCC, Mr. Hsu served as an Associate Director in the Division of Supervision 

and Regulation at the Federal Reserve Board of Governors. In that role, he chaired the 

Large Institution Supervision Coordinating Committee Operating Committee, which has 

responsibility for supervising the global systemically important banking companies operating 

in the United States.

His career also has included serving as a Financial Sector Expert at the International Monetary 

Fund, Financial Economist at the U.S. Department of the Treasury, and Financial Economist at 

the Securities and Exchange Commission.

Mr. Hsu holds of a Bachelor of Arts from Brown University, a Master of Science in finance 

from George Washington University, and Juris Doctor degree from New York University School 

of Law.

Rohit Chopra

Rohit Chopra is Director of the Consumer Financial Protection 

Bureau. The CFPB is a unit of the Federal Reserve System charged 

with protecting families and honest businesses from illegal 

practices by financial institutions, and ensuring that markets for 

consumer financial products and services are fair, transparent, 

and competitive. As Director, Mr. Chopra is also a member of the 

Board of Directors of the Federal Deposit Insurance Corporation 

and the Financial Stability Oversight Council.

In 2018, Mr. Chopra was unanimously confirmed by the U.S. Senate 

as a Commissioner on the Federal Trade Commission, where he 
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 193 

served until assuming office as CFPB Director. During his tenure at the FTC, he successfully 

worked to strengthen sanctions against repeat offenders, to reverse the agency’s reliance on 

no-money, no-fault settlements in fraud cases, and to halt abuses of small businesses. He also 

led efforts to revitalize dormant authorities, such as those to protect the Made in USA label 

and to promote competition.

The Director previously served at the CFPB from 2010 to 2015. In 2011, the Secretary of the 

Treasury designated him as the agency’s student loan ombudsman, where he led the Bureau’s 

efforts on student lending issues. Prior to his government service, Mr. Chopra worked at 

McKinsey & Company, the global management consultancy, where he worked in the financial 

services, health care, and consumer technology sectors.

Mr. Chopra holds a BA from Harvard University and an MBA from the Wharton School at the 

University of Pennsylvania.
A

PPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023

194 

FDIC Organizational Chart

Lo

DIVISION OF 

RESOLUTIONS AND 

RECEIVERSHIPS

Maureen Sweeney

DIVISION OF INSURANCE 

AND RESEARCH

Patrick Mitchell

DIVISION OF COMPLEX 

INSTITUTION 

SUPERVISION AND 

RESOLUTION

Arthur Murton

DEPUTY TO THE 

CHAIRMAN FOR 

FINANCIAL STABILITY

Arthur Murton

Director 

Director 

Director

Donna M. Saulnier

Director

Dr. Felita Boldin

Director and Chief 

Learning Officer

CORPORATE 

UNIVERSITY

DEPUTY TO THE 

CHAIRMAN FOR 

EXTERNAL AFFAIRS

DEPUTY TO THE 

CHAIRMAN AND 

CHIEF FINANCIAL OFFICER

DEPUTY TO THE 

CHAIRMAN AND CHIEF 

OPERATING OFFICER 

Dan Bendler

DIVISION OF 

INFORMATION 

TECHNOLOGY

Zachary Brown

CISO and 

Director of OCISO

OFFICE OF 

CHIEF INFORMATION 

SECURITY OFFICER

CHIEF INFORMATION 

OFFICER AND 

CHIEF PRIVACY OFFICER

Sylvia Burns Bret D. Edwards

OFFICE OF INSPECTOR GENERAL

Jennifer Fain*

INTERNAL OMBUDSMAN

Robert Harris

OFFICE OF FINANCIAL 

INSTITUTION ADJUDICATION

LEGAL DIVISION

*Sworn in on January 11, 2024

DIVISION OF DEPOSITOR 

AND CONSUMER 

PROTECTION

Mark E. Pearce Nikita Pearson

GENERAL COUNSEL

Harrel M. PettwayHarrel M. Pettway

OFFICE OF 

THE OMBUDSMAN

Jill Lennox

Ombudsman (Acting)

OFFICE OF RISK 

MANAGEMENT AND 

INTERNAL CONTROLS

Marshall Gentry

Director 

(1) Vacant

(2) Jennifer Whang

CHIEF OF STAFF

Kymberly Copa

BOARD OF DIRECTORS

Martin J. Gruenberg

FDIC

Chairman

Jonathan McKernan

FDIC

Board Member

Travis Hill

FDIC

Vice Chairman

Michael J. Hsu

Comptroller of 

the Currency (Acting)

Board Member

Rohit Chopra

CFPB Director

Board Member

DIVISION OF 

RISK MANAGEMENT 

SUPERVISION

Doreen Eberley

OFFICE OF MINORITY AND 

WOMEN INCLUSION 

Nikita Pearson

Director 

Andy Jimenez

Director 

OFFICE OF LEGISLATIVE AFFAIRS

DIVISION OF FINANCE OFFICE OF COMMUNICATIONS

Amy Thompson

Director General Counsel

OFFICE OF MINORITY 

AND COMMUNITY 

DEVELOPMENT BANKING

Betty Rudolph

Director

Administrative Law Judges

Dan Bendler

Director 

Sylvia Burns

Director 

DIVISION OF 

ADMINISTRATION
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 195 

CORPORATE STAFFING TRENDS

Note: 2014-2023 staffing totals reflect year-end full time equivalent staff. 

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

9,000

6,000

3,000

0

6,631 6,385 6,096 5,880 5,693 5,593 5,776 5,670 5,612 5,952

FDIC Year–End Staffing
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 196 

Number of Employees by Division/Office (Year-End)1

Total Washington Regional/Field

Division or Office: 2023 2022 2023 2022 2023 2022

Division of Risk Management Supervision 2,485 2,376 157 151 2,328 2,225

Division of Depositor and Consumer Protection 863 785 132 117 731 668

Legal Division 465 429 307 288 158 141

Division of Administration 412 395 301 289 111 106

Division of Resolutions and Receiverships 386 332 53 54 334 278

Division of Information Technology 304 292 177 165 127 127

Division of Complex Institution Supervision and Resolution 285 286 110 117 175 169

Division of Insurance and Research 196 190 168 153 28 37

Division of Finance 143 134 141 131 2 3

Executive Support Offices 2 88 88 77 76 11 12

Corporate University 75 65 59 53 16 12

Office of the Chief Information Security Officer 57 54 54 53 3 1

Office of Risk Management and Internal Controls 25 23 24 23 1 0

Executive Offices3 24 20 24 20 0 0

Office of Inspector General 144 143 92 92 52 51

Total 5,952 5,612 1,875 1,781 4,077 3,830

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 Legislative Affairs, Communications, Ombudsman, Financial Institution Adjudication, and Minority and Women 

Inclusion. 

3 Includes the Offices of the Chairman, Vice Chairman, Director (Appointive), Chief Operating Officer, Chief Financial Officer, Chief Information 

Officer, Consumer Protection and Innovation, External Affairs, Policy, and Financial Stability. 
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 197 

Sources of Information

FDIC WEBSITE

www.fdic.gov

A wide range of banking, consumer, and financial information is available on the FDIC’s publicfacing 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: 800-877-8339 

703-562-2289

The FDIC Call Center in Washington, D.C., 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 6:00 p.m., Eastern Time, Monday – Friday, 8:00 a.m. to 1:00 

p.m., Saturday, and closed 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 callers with over 40 different languages.
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 198 

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; walk-in service is available at the mailing address 

location. On-site visits are by appointment only.

OFFICE OF THE OMBUDSMAN

3501 Fairfax Drive

Suite VASQ E-2048

Arlington, VA 22226-3500

Phone: 1-877-275-3342 

E-mail: ombudsman@fdic.gov

Online Comment form: https://ask.fdic.gov/fdicinformationandsupportcenter/s/

Website: www.fdic.gov/ombudsman

A Resource for the Banking Industry 

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. OO representatives participate in all 

bank closings to provide accurate information to bank customers, bank employees, and the 

general public. 
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 199 

Regional Offices

ATLANTA REGIONAL OFFICE CHICAGO REGIONAL OFFICE

Timothy D. Rich, Regional Director Gregory Bottone, Regional Director 

10 Tenth Street, NE 300 South Riverside Plaza

Suite 900 Suite 1700

Atlanta, Georgia 30309 Chicago, Illinois 60606

(678) 916-2200 (312) 382-6000

States represented: States represented:

Alabama Illinois

Florida Indiana

Georgia Kentucky

North Carolina Michigan

South Carolina Ohio

Virginia Wisconsin

West Virginia
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 200 

DALLAS REGIONAL OFFICE KANSAS CITY REGIONAL OFFICE

Kristie K. Elmquist, Regional Director James D. LaPierre, Regional Director

600 North Pearl Street 1100 Walnut Street

Suite 700 Suite 2100

Dallas, Texas 75201 Kansas City, Missouri 64106

(214) 754-0098 (816) 234-8000

States represented: States represented:

Arkansas Iowa

Colorado Kansas

Louisiana Minnesota

Mississippi Missouri

New Mexico Nebraska

Oklahoma North Dakota

Tennessee South Dakota

Texas

NEW YORK REGIONAL OFFICE SAN FRANCISCO REGIONAL OFFICE

John Vogel, Regional Director Paul P. Worthing, Regional Director

350 Fifth Avenue 25 Jessie Street at Ecker Square

Suite 1200 Suite 2300

New York, New York 10118 San Francisco, California 94105

(917) 320-2500 (415) 546-0160

States and territories represented: States and territories represented:

Connecticut Alaska

Delaware American Samoa

District of Columbia Arizona

Maine California

Maryland Federated States of Micronesia

Massachusetts Guam

New Hampshire Hawaii

New Jersey Idaho

New York Montana

Pennsylvania Nevada

Puerto Rico Oregon

Rhode Island Utah

Vermont Washington

Virgin Islands Wyoming
Top Management and Performance Challenges

Facing the Federal Deposit Insurance Corporation

February 2024



Federal Deposit Insurance Corporation

Office of Inspector General

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 201


NOTICE 

Pursuant to Pub. L. 117-263, section 5274, non-governmental organizations and business

entities identified in this OIG Top Management and Performance Challenges Report have the

opportunity to submit a written response for the purpose of clarifying or providing additional

context to any specific reference. Comments must be submitted to comments@fdicoig.gov

within 30 days of the report publication date as reflected on our public website. Any

comments will be appended to this report and posted on our public website. We request that

submissions be Section 508 compliant and free from any proprietary or otherwise sensitive 

information.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 202
Date: February 22, 2024

Memorandum To: Board of Directors

 /Signed/

From: Jennifer L. Fain

Inspector General

Subject Top Management and Performance Challenges Facing the Federal

Deposit Insurance Corporation

The Office of Inspector General (OIG) presents its annual assessment of the Top Management

and Performance Challenges facing the Federal Deposit Insurance Corporation (FDIC). This

document summarizes the most serious challenges facing the FDIC and briefly assesses the 

Agency’s progress to address them.

This Challenges document is based on the OIG’s experience and observations from our

oversight work, reports by other oversight bodies, review of academic and relevant literature,

perspectives from Government agencies and officials, and information from private-sector

entities. In several instances, we discuss topic areas where the OIG had previously conducted 

work to evaluate, audit, and review the FDIC’s progress in these Challenge areas.

We identified nine Top Challenges facing the FDIC. The Challenges identify risks to FDIC

mission-critical activities and to FDIC internal programs and processes that support mission

execution. These Challenges include all aspects of the Challenges that we reported last year,

with important updates. Among these updates are the need for the FDIC to address increasing 

staff attrition--especially for examiners--and to focus on improving the FDIC’s workplace

environment. We also note that the failures of Signature Bank of New York and First Republic

Bank demonstrated the need for the FDIC to escalate supervisory actions when risks are 

identified, consistent with the FDIC’s forward-looking supervision initiative. Further, the FDIC

should consider emerging risks in its failure estimation process and ensure that the FDIC can

execute its orderly liquidation resolution authority.

The FDIC’s Top Challenges include:

1. Strategic Human Capital Management at the FDIC

2. Identifying and Addressing Emerging Financial Sector Risk

3. Ensuring Readiness to Execute Resolutions and Receiverships

4. Identifying Cybersecurity Risks in the Financial Sector

5. Assessing Crypto-Asset Risk

6. Protecting Consumer Interests and Promoting Economic Inclusion

7. Fortifying IT Security at the FDIC

8. Strengthening FDIC Contract and Supply Chain Management

9. Fortifying Governance of FDIC Programs and Data

We commend the FDIC for taking steps in some areas to address certain Challenges and we

note many of these actions in the attached document. This researched and deliberative analysis

guides our work and we believe it is beneficial and constructive for policy makers, including the 

FDIC and Congressional oversight bodies. We further hope that it is informative for the

American people regarding the programs and operations at the FDIC and the Challenges it

faces.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION

Federal Deposit Insurance Corporation

Office of Inspector General

ANNUAL REPORT 2023 203
 Strategic Human Capital Management at the FDIC 

Key Areas of Concern 

The primary areas of concern for this 

Challenge are:

• Addressing FDIC Staff Attrition

• Managing a Wave of Prospective

Retirements at the FDIC

• Sustaining a Work Environment Free

from Discrimination, Harassment, and

Retaliation

The FDIC relies on the talents and skills of 

its workforce of over 5,700 employees to 

accomplish its mission to maintain stability 

and public confidence in the Nation’s 

financial system. The FDIC’s strategic 

management of its human capital is 

important to ensure that the FDIC does not 

experience mission-critical skill and 

leadership gaps. Strategic human 

capital management involves a dynamic 

set of factors across multiple activities—

workforce planning, recruitment, hiring, 

orientation, compensation, engagement, 

succession planning, and retirement 

programs. These activities should occur 

within a workplace that proactively 

prevents and addresses discrimination, 

harassment, and retaliation, and that 

ensures workforce diversity, equity, 

inclusion, and accessibility. Further, 

strategic human capital management 

involves consideration of the trade-offs of 

hiring permanent, temporary, or 

contracted staff to perform the FDIC’s 

work. 

The Government Accountability Office

(GAO) continues to recognize strategic 

human capital management as a 

Government-wide high-risk area, and we 

have included human capital risk as an 

FDIC Top Management and Performance 

Challenge since 2018. The FDIC has also 

included human capital management as a 

risk in the FDIC’s Enterprise Risk 

Management (ERM) Risk Portfolio and in 

2023 elevated the issue to the highest 

Enterprise Risk at the FDIC.

Addressing FDIC Staff Attrition 

Attrition—through resignations and 

retirements—can create opportunities for 

employees and allow organizations to 

restructure, but if turnover is not 

strategically monitored and managed, gaps 

can develop in an organization’s institutional 

knowledge and leadership. 

The FDIC has faced increasing staff attrition 

rates, and the FDIC has been unable to 

close the attrition gap through hiring. As 

shown in Figure 1, the 2022 FDIC staff 

attrition rate remained higher than the 

pre-pandemic rates of 6.3 percent in 2018 

and 7 percent in 2019. In part, the attrition 

increased in 2021 and 2022 because of the 

FDIC’s Voluntary Early Retirement and 

Separation Incentive Program, which began 

in early March 2020, was suspended in midMarch 2020 as a result of the pandemic, 

and reintroduced in February 2021 for 

certain positions.

Further, the FDIC attrition rate has generally 

been lower than that of the Federal 

Source: FDIC Retention Management: Baseline Organizational 

Assessment 

Figure 1: Workforce Attrition Rates for FDIC and Federal 

Government-wide 2018-2022

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 204
Government, but in 2022 the FDIC attrition 

rate was beginning to close that gap. 

According to the FDIC’s analysis of surveys 

from employees departing the FDIC, more 

than 41 percent of those departing were 

retiring, and about 25.5 percent were 

resigning to take positions at banks or within 

the private sector. Nearly 16 percent of 

employees transferred to other Federal 

agencies, and 17.5 percent did not provide 

a reason for departure. 

FDIC staff hiring has not kept pace with 

FDIC attrition in all FDIC Divisions. We 

computed the FDIC’s 

net gain or loss for 

staff hiring and 

attrition for the 5-year 

period between 

January 1, 2018, and 

January 1, 2023. As 

shown in Figure 2, 

despite hiring, 

important FDIC 

Divisions had 

cumulative net 

employee losses over 

that 5-year period. In 

other words, the FDIC 

lost more employees 

during that period 

than it was able to 

hire. 

The FDIC’s largest component, the Division 

of Risk Management Supervision (RMS), 

responsible for safety and soundness 

examinations and bank supervision, had a 

net loss of nearly 200 staff (about 9 percent 

of RMS employees). The FDIC’s second 

largest component, the Division of Depositor 

and Consumer Protection (DCP), which 

conducts bank consumer compliance 

examinations, had a net loss of more than 

100 personnel (or about 14 percent of DCP 

employees); the Division of Resolutions and 

Receiverships (DRR), responsible for

marketing and resolving failed banks, 

paying deposit insurance, and managing 

bank receiverships, had net employee 

losses of over 50 staff (or about 20 percent

of employees). The Legal Division, which 

provides legal support for all FDIC

Divisions, experienced a net loss of over 50 

staff (about 16 percent of employees). The

Division of Insurance and Research (DIR),

which analyzes emerging risks to the

Deposit Insurance Fund (DIF), had net staff

losses of over 20 personnel (about 14 

percent of employees). The Division of

Complex Institution Supervision and 

Resolution (CISR), responsible for the

supervision and resolution of the largest

banks, had net staff losses of more than 10 

staff (about 5 percent of employees).

Three of the six Divisions noted above also 

had increases in budgeted authorized 

staffing levels in 2021 and 2022. In effect,

at the same time that the FDIC was unable 

to hire to replace staff losses, the FDIC

determined that additional staff was needed

to accomplish its mission, thereby further

increasing the number of required new

hires. 

Figure 2: Cumulative Net Employee Losses (hiring less attrition) for the Period of 

January 1, 2018 to January 1, 2023

-250 -200 -150 -100 -50 0

CISR

DIR

Legal

DRR

DCP

RMS

Source: OIG Analysis of FDIC Data 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 205
As shown in Figure 3, CISR had a budget 

authorized staffing increase of 16 percent in 

2021 and 7 percent in 2022. RMS had a 

budget authorized staffing increase of 1 

percent in 2021 and 7 percent in 2022. 

DCP had a budget authorized staffing 

increase of 4 percent in 2022. Although the 

Legal Division, DIR, and DRR had small 

percentage budget authorized staffing 

decreases, their respective cumulative net 

staff losses exceeded budget authorized 

staffing reductions. 

In addition, the FDIC experienced 

increasing attrition for mission-critical FDIC 

examination staff. Examiners work in four 

Divisions at the FDIC: RMS, DCP, CISR, 

and the FDIC’s Corporate University (CU). 

RMS examiners conduct safety and 

soundness examinations. According to the 

FDIC’s Risk Management Manual of 

Examination Policies, bank safety and 

soundness examinations allow the FDIC to 

“identify the cause and severity of problems 

at individual banks and emerging risks in 

the financial services industry. The accurate 

identification of existing and emerging risks 

helps the FDIC develop effective corrective 

measures for individual institutions and 

broader supervisory strategies for the 

industry.” DCP examiners conduct 

consumer compliance examinations that the 

FDIC Consumer Compliance Examination 

Manual states “are the primary means the

FDIC uses to determine whether a financial

institution is meeting its responsibility to 

comply with the requirements and 

proscriptions of Federal consumer 

protection laws and regulations.” 

CISR specialists, many of whom 

qualify as examiners, perform 

back-up supervision, risk 

monitoring and analysis, and 

resolution planning activities for

large complex financial

institutions, and examiners in CU

teach examination skills to other

examiner staff.

As shown in Figure 4, overall 

attrition among all FDIC 

examiners increased in 2021 and 

2022 after the pandemic but 

began to contract in 2023. 

Although overall attrition rates 

trended lower in 2023, examiner 

resignations continued to 

increase. For 2020, examiner attrition 

equaled about 4 percent of all FDIC 

examination staff with 38 examiners 

resigning. In 2021, examiner attrition rose 

to about 6 percent with 83 examiners 

resigning. In 2022, about 7 percent of 

examiners left the FDIC with 85 examiners 

0

20

40

60

80

100

120

140

160

180

200

2020 2021 2022 2023

Resign Retire

Figure 4: All FDIC Examiner Resignations and 

Retirements 2020-2023

Figure 3: Budget Authorized Staffing Percentage 

Increase/Decrease for Selected Divisions from 2021-2022

-5%

0%

5%

10%

15%

20%

CISR RMS DCP Legal DIR DRR Percentage Change in

Authorized Staff

2021 2022

Source: OIG Analysis of FDIC Budget Data

Source: OIG Analysis of FDIC Data 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 206
resigning. The examiner attrition rate in 

2023 was 6 percent with 100 examiners 

resigning. 

Further, turnover rates for new examiners 

are higher than those for new employees 

throughout the FDIC. The FDIC’s March 

2023 Baseline Organizational Assessment 

found that early career examiners with 2 

years of training had a 15.4 percent 

turnover rate, but the turnover rate for nonexaminer FDIC employees with 2 years of 

service was 4.3 percent. 

Examiner departures are costly to the FDIC 

in terms of both funding and time. The 

FDIC invests approximately 4 years of 

training for new examiners from the time 

they are hired until they earn an 

examination commission. Such 

commissioning requires that employees 

meet benchmarks, training, and other 

technical requirements, including passing a 

Technical Examination. 

Importantly, examiner departures have 

impacted the FDIC’s mission. Both the 

FDIC report and our report on the failure of 

Signature Bank of New York found that the 

FDIC lacked examination resources to 

conduct timely, quality safety and 

soundness examinations. 

In the FDIC Chief Risk Officer’s report, 

FDIC’s Supervision of Signature Bank, the 

FDIC found that it “experienced resource 

challenges with examination staff that 

affected the timeliness and quality of 

[Signature Bank] examinations.” The report 

found that since 2020, 40 percent of the 

FDIC’s New York Regional Office large 

bank safety and soundness examination 

staff positions had been either vacant or 

filled with temporary staff. Further, the 

FDIC noted challenges regarding the quality 

of examiner skillsets that required additional 

supervisory review of data analysis and 

reports. As a result, the report concluded 

that “the vacancies and adequacy of the 

skillsets of the Dedicated Team slowed 

earlier identification and reporting of

[Signature Bank] weaknesses.” 

In our Material Loss Review of Signature 

Bank of New York, we found that the FDIC

did not timely perform supervisory activities

and was repeatedly delayed in issuing 

supervisory products because of staffing 

limitations in terms of the number of 

available personnel and their respective 

skillsets. We noted frequent turnover in the 

FDIC’s New York Regional Office 

examination staff and that temporary 

personnel added prior to 2022 to the 

Signature Bank examination team often 

lacked requisite experience with large 

banks. 

We recommended that the FDIC reevaluate 

its strategy to attract, retain, and allocate 

staff. Further, as discussed in greater detail 

in the Identifying Cybersecurity Risks in the 

Financial Sector section of this Report, we 

also found that FDIC examiner staffing 

impacted the ability of the FDIC to conduct 

timely examinations of bank third-party 

service providers. 

Managing a Wave of Prospective 

Retirements at the FDIC 

The FDIC also faces significant prospective 

retirement-eligibility risk for current staff. 

Retirement eligibility is the date that an 

employee is eligible to choose to retire, but 

employees may work beyond their eligibility 

date. 

The FDIC makes annual retirement date 

projections beyond eligibility dates based on 

a combination of factors, including age and 

retirement eligibility. Historically, the FDIC 

has found that many employees have 

chosen to work beyond their retirementeligibility dates. 

The FDIC faces staffing risks based on its 

employee retirement-eligibility rates, which 

are higher than Government-wide averages. 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 207
As shown in Table 1, 23 percent of the 

FDIC workforce was eligible to retire in 

2023, with that figure rising to 36 percent in 

2027. According to Analytic Perspectives in 

the President’s Fiscal Year 2023 budget, 15 

percent of the Federal workforce was 

eligible to retire in Fiscal Year 2023 with 30 

percent eligible in the next 5 years. Further, 

every FDIC Division except DCP had higher 

staff retirement-eligibility rates than the 

current Government-wide average 

retirement eligibility rate of 15 percent. 

Retirement-eligibility rates are high for FDIC 

Executives and Managers across FDIC 

Regional Offices and for mission-critical 

examination staff. 

As noted in Table 2, about 41 percent of all 

Executives and nearly 30 percent of all 

FDIC Managers were eligible to retire in 

2023. These rates climb to 57 percent for 

FDIC Executives and nearly 47 percent for 

Managers by 2027. Some FDIC Regional 

Offices have significantly higher retirement 

rates for their Executives and Managers. 

Division 2023 2024 2025 2026 2027

Division of Finance (DOF) 38% 43% 46% 46% 47%

Division of Resolutions and Receiverships (DRR) 37% 42% 45% 47% 49%

Legal Division (Legal) 33% 38% 38% 48% 48%

Division of Administration (DOA) 29% 32% 36% 39% 41%

Division of Risk Management Supervision (RMS) 21% 25% 28% 32% 34%

Division of Information Technology (DIT) 18% 21% 23% 27% 31%

Division of Complex Institution Supervision and Resolution (CISR) 16% 20% 25% 27% 31%

Division of Insurance Research (DIR) 16% 21% 24% 25% 28%

Division of Depositor and Consumer Protection (DCP) 15% 19% 23% 27% 29%

Overall for FDIC 23% 27% 30% 33% 36%

Table 1: FDIC Staff Retirement-Eligibility Rates by Division

Source: OIG Analysis of FDIC Data

Regional Office 2023 2024 2025 2026 2027

Executives Atlanta 100% 100% 100% 100% 100%

 Chicago 100% 100% 100% 100% 100%

 Dallas 75% 75% 100% 100% 100%

 Kansas City 100% 100% 100% 100% 100%

 New York 25% 25% 25% 50% 50%

 San Francisco 33% 67% 67% 67% 67%

 Washington 37% 42% 48% 51% 53%

All Executives 41% 46% 52% 56% 57%

Managers

 Atlanta 21% 31% 37% 40% 45%

 Chicago 22% 36% 47% 52% 56%

 Dallas 49% 53% 58% 61% 63%

 Kansas City 38% 47% 53% 58% 58%

 New York 25% 32% 39% 46% 50%

 San Francisco 24% 30% 33% 42% 48%

 Washington 28% 31% 36% 38% 40%

All Managers 29% 35% 41% 44% 47%

 Table 2: FDIC Executive and Manager Retirement Eligibility

 Source: OIG Analysis of FDIC Data

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 208
For example, 100 percent of Atlanta, 

Chicago, and Kansas City Regional Office 

Executives and 75 percent of the 

Executives from the Dallas Regional Office 

were eligible to retire in 2023. These 

retirements may result in gaps in leadership 

positions. Leadership gaps can cause 

delayed decision-making, reduced program 

oversight, and failure to achieve Agency 

goals.

In addition, a significant percentage of 

examiners across the FDIC are eligible for 

retirement. As shown in Table 3, in 2023, 

30 percent of supervisory examiners were 

eligible to retire – a figure that climbs to 53 

percent in 2027. In 2023, 15 percent of

non-supervisory examiners were eligible to 

retire, and by 2027, 29 percent of this group 

is eligible to retire. 

Further, some of the examiners noted in 

Table 3 are considered to be subject-matter 

experts (SME) because they have additional 

training and experience in certain bankrelated disciplines. As shown in Table 4,

the FDIC faces significant retirement risks 

for SMEs. Notably, the FDIC has the 

highest SME retirement-eligibility rates for 

Advanced Information Technology (IT) and 

Trust Account experts followed by 

Intermediate IT, Bank Secrecy Act/AntiMoney Laundering (BSA/AML), Capital

Markets, Accounting, and Consumer

Protection experts. The FDIC’s vulnerability

to SME retirements is occurring at a time 

when banks are facing rising risks from the

increased use of Advanced IT, partnerships

with third-party service providers,

involvement with crypto assets and cryptoasset sector participants, and potential fraud

and money laundering risks.

Collectively, FDIC current attrition and

retirement-eligibility rates have the potential

to result in future organizational knowledge,

skill, and leadership gaps that may impede

the FDIC from achieving results. 

The FDIC has recognized the significance 

of its human capital risk and has taken a 

number of steps to mitigate risks. 

For example, in March 2023, the FDIC

completed a Baseline Organizational

Assessment to support the work of an 

FDIC-wide Retention Management Working

Group. The FDIC also established a 

Human Capital Strategic Planning Analysis

Unit within the Division of Administration to

design an Agency-wide approach to 

address talent pipeline challenges. In

September 2021, the FDIC also began its

Leadership Excellence Acceleration 

2023 2024 2025 2026 2027

Supervisory examiners 30% 39% 45% 50% 53%

Non-supervisory examiners 15% 19% 23% 26% 29%

Table 3: Supervisory and Non-Supervisory Retirement-Eligibility Rates for All Examiners

Source: OIG Analysis of FDIC Data

2023 2024 2025 2026 2027

Advanced IT 31% 62% 62% 69% 69%

Trusts 29% 35% 39% 45% 53%

Intermediate IT 22% 24% 27% 29% 31%

BSA/AML 16% 22% 28% 33% 40%

Capital Markets 15% 21% 28% 30% 32%

Accounting 14% 24% 30% 33% 36%

Consumer Protection 7% 7% 7% 13% 20%

Table 4: Examiner Retirement-Eligibility Rates for SMEs

Source: OIG Analysis of FDIC Data

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 209
Program offering non-supervisory

employees one year of specialized 

leadership training to provide the 

knowledge, skills, and experience to take on

leadership roles. Further, FDIC Divisions

have been assessing their human capital

needs, including one Division that is

engaging a contractor in its efforts. 

Sustaining a Work Environment 

Free From Discrimination, 

Harassment, and Retaliation 

Discrimination, harassment, and retaliation 

within an organization can have profound

effects and serious consequences for the

individual, fellow colleagues, and the

agency as a whole. In certain instances, a

harassed individual may risk losing a job or

the chance for a promotion, and it may lead 

the employee to suffer emotional and

physical consequences. It is critical for

organizations to have leadership that

promotes a workplace and culture that

safeguards against discrimination,

harassment, and retaliation.

Organizations should have policies,

procedures, and training to guard against

and effectively address discrimination,

harassment, and retaliation. Further,

organizations should have mechanisms for

individuals to report incidents of

discrimination, harassment, and retaliation,

and processes to promptly assess reported

incidents and take appropriate actions

against those who engage in such

misconduct.

In our July 2020 OIG evaluation, Preventing

and Addressing Sexual Harassment, we

assessed the FDIC’s sexual harassmentrelated policies, procedures, training, and

practices for the period January 2015 

through April 2019. We found that the FDIC

had not established an adequate sexual

harassment prevention program and should 

improve its policies, procedures, and 

training to facilitate the reporting of sexual

harassment allegations and address

reported allegations in a prompt and

effective manner. Specifically, we found that

the FDIC had not developed a sexual

harassment prevention program that fully

aligned with the five core principles

promoted by the Equal Employment

Opportunity Commission: (1) committed and

engaged leadership; (2) strong and 

comprehensive harassment policies; (3)

trusted and accessible complaint

procedures; (4) regular, interactive training 

tailored to the audience and the

organization; and (5) consistent and 

demonstrated accountability.

As part of our evaluation, we conducted a

voluntary survey of FDIC employees. The

survey responses provided insight into

employee understanding of what constitutes

sexual harassment, instances of sexual

harassment experienced or observed at the 

FDIC, impediments to reporting, and the 

adequacy of training. Our survey found that

approximately 8 percent of FDIC

respondents (191 of 2,376) said that they

had experienced sexual harassment at the

FDIC during the period January 2015 

through April 2019.

Although 191 FDIC respondents to the OIG

survey reportedly experienced sexual

harassment, the FDIC only received 12 

reported sexual harassment allegations,

including both formal complaints and

misconduct allegations from January 2015 

through April 2019. This response suggests

that there may have been an underreporting

of sexual harassment allegations. We

made 15 recommendations to the FDIC to

strengthen its anti-sexual harassment

program. The FDIC made changes to its

anti-sexual harassment policies and 

procedures based on our recommendations.

On November 13, 2023, the Wall Street

Journal published the first of several articles

outlining a toxic work environment at the 

FDIC over at least a decade that alleged 

sexual harassment, a heavy drinking

culture, improper behavior by FDIC senior

leaders, and an unwillingness of employees

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 210
to file sexual harassment complaints

because of the fear of retaliation. On 

November 21, 2023, the FDIC Board

announced that the Board had established a 

Special Committee co-chaired by FDIC

Director Jonathan McKernan and FDIC

Director and Acting Comptroller of the 

Currency Michael Hsu to oversee a “thirdparty review of the agency’s workplace 

culture.” In addition, we have work ongoing 

to follow up on our assessment of the 

FDIC’s sexual harassment prevention 

program and a Special Inquiry to report on

the leadership climate at the FDIC with 

regard to all forms of harassment and

inappropriate behavior.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 211
Identifying and Addressing Emerging 

Financial Sector Risk 

Key Areas of Concern 

In addition to the examiner staffing 

challenges described in the Strategic

Human Capital Management at the FDIC

section of this Report, the primary areas of

concern for this Challenge area are:

• Escalating Supervisory Actions to

Address Identified Risks

• Assessing Emerging Risks Through

Data Gathering and Analysis

• Considering Emerging Risks in the

FDIC’s Bank Failure Estimation

Process

• Sharing Threat and Vulnerability

Information with Financial

Institutions

According to the FDIC’s Quarterly Banking 

Profile, the FDIC insures over 4,600

financial institutions with total assets

exceeding $23 trillion. The FDIC supervises

over 2,900 of these banks with combined 

total assets of about $4.2 trillion. A key 

aspect of the FDIC’s bank supervision is a 

forward-looking supervisory approach to 

identify and assess bank and banking 

sector risks before they impact the financial

condition of a bank or the broader financial

sector.

Escalating Supervisory Actions to 

Address Identified Risks 

When FDIC examinations identify

weaknesses in bank risk management, the 

FDIC should ensure that bank board

members and senior management take 

timely and appropriate actions to address

such risks. FDIC examinations may include 

recommendations requiring that bank board

members address weaknesses, or in the

case of severe deficiencies, the FDIC may

put in place informal or formal enforcement

actions to require program improvements

and hold banks accountable for

implementing and maintaining required 

changes.

1

Prior to the financial crisis of 2008-2011,

examiners identified weak risk management

practices at financial institutions, but they

often delayed taking supervisory action until

the institution’s financial performance

declined. In some cases, financial decline 

led to bank failures and losses to the DIF.

To avoid that result, in 2011 the FDIC

implemented a forward-looking supervisory

initiative as part of its risk-focused 

supervision program. The goal of this

supervisory approach was to identify and 

assess risk before it impacts a bank’s

financial condition and to ensure early risk

mitigation.

Both our Material Loss Review of Signature 

Bank of New York and the FDIC Chief Risk

Officer’s report, FDIC’s Supervision of

Signature Bank, found that the FDIC could 

have escalated supervisory concerns

regarding Signature Bank earlier, consistent

with the FDIC’s forward-looking supervision 

initiative.

These supervisory concerns included 

multiple opportunities to downgrade the

Management component of the FDIC’s

safety and soundness examination rating

known as CAMELS2

—changing the 

Management component from a 2—

meaning satisfactory, to a 3—meaning 

needs improvement. The downgrade may

have lowered the bank’s composite

CAMELS rating and, according to FDIC

policy, supported consideration of an

enforcement action against Signature Bank.

We made three recommendations to the 

FDIC to emphasize to examiners the

importance of timely escalation of

supervisory concerns in line with the FDIC’s

forward-looking supervision initiative. 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 212
In remarks before the Committee on 

Financial Services, United States House of 

Representatives, on November 15, 2023, 

the FDIC Chairman noted that the FDIC 

was looking at options to improve 

supervision, such as “updating examiner 

guidance to be more explicit about analyses 

of uninsured deposit concentrations and 

reemphasiz[ing] to examiners the 

importance of forward–looking indicators of 

risk, such as high growth rates and 

breaches of internal risk limits.” In our 

report, Material Loss Review of First 

Republic Bank, we recommended that the

FDIC also engage with other regulators to

evaluate the need for changes to rules 

under safety and soundness standards, 

including the adoption of noncapital triggers 

that would require early and forceful 

regulatory actions to address unsafe 

banking practices before such practices

impair capital. 

Assessing Emerging Risks Through 

Data Gathering and Analysis 

The FDIC has a number of activities, 

beyond examinations, for the detection of 

emerging risks in the banking sector. The 

FDIC’s Offsite Review Program is designed 

to identify emerging supervisory concerns 

and potential problems that may arise 

between onsite bank examinations so that 

supervisory strategies can be adjusted 

appropriately.3

 Further, the FDIC released 

its Risk Review 2023 report outlining key 

risks to banks. Through our work, we have 

found that the FDIC could do more to 

assess emerging risks by analyzing the data 

it holds and obtaining data from outside the

FDIC. 

Information Technology Risks. According 

to our report, Implementation of the FDIC’s 

Information Technology Risk Examination 

(InTREx) Program, the FDIC is not fully

utilizing available data and analytic tools to 

identify emerging IT risks at financial 

institutions. In 2017, the FDIC developed a 

tool called AlphaREx to conduct analysis of 

unstructured data from IT examinations. 

The FDIC used AlphaREx to identify 

financial institutions at risk from specific 

types of vulnerabilities, but the system has 

not been used to analyze FDIC IT 

examination data to identify emerging 

trends across all FDIC-supervised 

institutions. Such risk trend information 

could be used to promote risk remediation 

efforts, target specific IT reviews, and 

improve IT examination processes. Such 

analysis could be valuable to both 

policymakers and examiners in assessing 

cyber threats, formulating supervisory

strategies, and evaluating the adequacy of

InTREx procedures and examiner training. 

The FDIC is conducting a review to 

determine areas in which to use AlphaREx 

to identify emerging IT risks and trends at 

financial institutions. 

Further, in our memorandum, The FDIC’s 

Regional Service Provider Examination 

Program, we identified an opportunity for

the FDIC to leverage available information 

to develop a comprehensive inventory of 

FDIC-supervised bank service providers. A 

map of bank and third-party 

interconnections may be useful for 

examiners to understand the full scope of 

cybersecurity risks—rather than risks solely 

for a single bank or third party. This 

information may also help FDIC 

policymakers to ensure that FDIC policies 

and examination procedures appropriately 

address and assess interconnected risks. 

Further, in the event of a cybersecurity 

incident, a mapping of bank and third-party 

relationships may allow the FDIC to quickly 

identify the parties at risk and may provide 

relevant threat information and supervisory 

guidance to mitigate such risk as well as

prepare for potential resolutions. 

Threat Information. In our report, Sharing 

of Threat Information to Guide the 

Supervision of Financial Institutions, we 

found that the FDIC receives threat

information relevant to the banking sector, 

but the FDIC had not established effective 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 213
processes to acquire, analyze, disseminate,

and use relevant and actionable threat

information to guide the supervision of

financial institutions. For example, the FDIC

relied solely on the judgment of certain 

individuals to determine the extent to which 

threat information should be analyzed to 

support FDIC business needs and the 

supervision of financial institutions rather

than engaging stakeholders and developing

procedures to guide analysis.

Also in our report, Sharing of Threat and

Vulnerability Information with Financial

Institutions, we found that the FDIC’s threat

intelligence operations may benefit from

using an available natural language 

processing tool or alternative capabilities to 

analyze other FDIC unstructured data sets

for the identification of threat and

vulnerability information.

Government-Guaranteed Loan 

Information. In our report, FDIC

Examinations of Government-Guaranteed

Loans, we found that FDIC examiners did 

not have adequate data to identify, monitor,

and research bank participation in 

Government-Guaranteed loan programs.

The FDIC’s DIR had obtained information 

from publicly-available sources for researchrelated purposes and studies, but that data

was neither requested by nor shared with 

examination staff.

Absent sufficient data, the FDIC may be 

limited in its ability to proactively identify and 

monitor emerging risks associated with a 

bank’s participation in GovernmentGuaranteed loan programs. GovernmentGuaranteed loan programs often have 

complex requirements and documentation 

standards that present compliance 

challenges for financial institutions. For

example, a Federal agency may rescind its

guaranty if a bank makes a loan to an 

ineligible borrower or to a borrower that

lacks creditworthiness or repayment ability.

The FDIC completed 6 recommendations

and is in the process of implementing the

remaining 13 recommendations we made to

improve the FDIC’s supervision of banks

that participate in Government-Guaranteed

loan programs.

Climate Change. As part of the Council of

Inspectors General on Financial Oversight,

we contributed to the Audit of the Financial

Stability Oversight Council’s Efforts to

Address Climate-Related Financial Risk

(FSOC Climate Report) that found that

FSOC’s Report on Climate-Related

Financial Risk was consistent with 

Executive Order 14030, Climate-Related 

Financial Risk. The FSOC Climate Report

identified the need for “actionable climaterelated data to allow better risk

measurement by regulators and in the

private sector.” According to the FDIC’s

Risk Review 2023, the FDIC is at the

beginning stages of assessing climaterelated financial risks. The FDIC is working

with other Federal banking regulators,

FSOC, and international organizations to 

ensure a common understanding of risks

and share information.

On October 30, 2023, Federal banking

regulators issued final Interagency

Guidance on Principles for Climate-Related 

Financial Risk Management for Large

Financial Institutions. The principles

“provide a high-level framework for the safe

and sound management of large bank

exposures to climate-related financial risks.”

The principles focus on governance,

strategic planning, risk management, data,

scenario analysis, and policies and 

procedures. The FDIC is also focusing on

monitoring how the adverse effects of

climate change could include a potentially

disproportionate impact on the financially

vulnerable, including low- and moderateincome and other underserved consumers

and communities.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 214
Considering Emerging Risks in the 

FDIC’s Bank Failure Estimation 

Process 

The FDIC estimates anticipated bank 

failures for its financial statements and for 

budgeting and planning purposes. The 

FDIC’s internal Financial Risk Committee 

determines the FDIC’s DIF Contingency 

Liability for Anticipated Failure of Insured 

Institutions for FDIC financial statements 

using a process that has been in place 

since at least 2015.4 The Committee 

determines which institutions are included in 

the Contingency Liability for Anticipated 

Failure of Insured Institutions primarily 

based on bank examination CAMELS 

ratings, which may have up to an 18-month 

reporting lag. The anticipated failures figure 

also informs the FDIC failure estimate used 

for budgeting and resolution planning, which 

can be more forward-looking than the 

estimate used for the financial statements. 

It is critical that the FDIC have a robust 

failure estimation process for its budgeting 

and resolution planning that monitors 

emerging banking risks. For example, 

failure estimates may need to consider the 

impact of the ease and speed of deposit 

movement through mobile apps and other 

technology as well as banks’ unrealized 

losses on investment securities in assessing 

potential failure scenarios. 

As noted in our reports, 

Material Loss Review of 

Signature Bank of New York

and Material Loss Review of 

First Republic Bank, the 

speed of deposit movement

and unrealized losses played 

a role in these bank failures. 

Further, as shown in Figure 5, 

unrealized losses on 

investment securities for 

insured banks rose again in 

the Third Quarter of 2023 to 

about $675 billion.

Sharing Threat and Vulnerability 

Information with Financial 

Institutions 

A bank’s Board of Directors and senior 

management are ultimately responsible for 

an institution’s risk management. The 

FDIC, as a member of the Federal Financial 

Institutions Examination Council (FFIEC),

has jointly stated that financial institutions 

should have an effective threat intelligence 

program, including methods for gathering, 

monitoring, sharing, and responding to 

threat and vulnerability information in order 

to support the institutions’ safety and 

soundness. Without emerging threat and 

vulnerability information, bank board 

members and senior management may be 

unable to assess threats to their 

organization and take actions to reduce 

risks. 

In our report, Sharing of Threat and 

Vulnerability Information with Financial 

Institutions, we found that the FDIC has

implemented processes for sharing threat

and vulnerability information with financial 

institutions. For example, the FDIC 

established formal procedures to 

communicate cyber threat and vulnerability 

information. However, the FDIC can 

improve the effectiveness of its processes 

to ensure financial institutions receive 

Figure 5: Unrealized Gains (Losses) on Investment Securities

Source: FDIC Quarterly Banking Profile, Third Quarter 2023

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 215
•

actionable and relevant threat and 

vulnerability information. We determined 

that: 

• The FDIC can improve its sharing

of threat and vulnerability

information with financial

institutions and other financial

sector entities.

The FDIC can improve its controls

over the recording of reported

computer-security incidents to

support threat intelligence 

operations and sharing activities. 

• The FDIC can mature its threat

information sharing program by

establishing procedures for sharing

non-cyber-related threat information

and revising the program’s existing

threat sharing policies and

procedures.

We made 10 recommendations to improve 

the FDIC’s processes in order to ensure that 

financial institutions receive actionable and 

relevant threat and vulnerability information.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 216
Ensuring Readiness to Execute 

Resolutions and Receiverships 

Key Areas of Concern

In addition to the staffing challenges

described in the Strategic Human Capital

Management at the FDIC section of this

Report, the primary areas of concern for this

Challenge are:

• Readiness for FDI Act Resolutions

• Preparing for an Orderly Liquidation

The FDIC must stand ready to resolve failed 

financial institutions. The Federal Deposit

Insurance Act (FDI Act) grants authority to

the FDIC to execute bank resolutions and 

become a receiver of failed banks. The FDI

Act, however, does not apply to systemically

important financial companies (SIFC) such

as investment banks, insurance companies,

and broker-dealers. Title II of the DoddFrank Wall Street Reform and Consumer

Protection Act of 2010 (Dodd-Frank Act)

was enacted and designed to address this

gap and granted Orderly Liquidation 

Authority (OLA) to the FDIC to provide the

necessary authority to liquidate failing 

financial companies that pose a significant

risk to the financial stability of the United

States in a manner that mitigates such risk

and minimizes moral hazard.

Readiness for FDI Act Resolutions 

The FDIC generally resolves failed banks

under the FDI Act over a weekend to limit

impacts to bank customers, but preparation

activities for a resolution begin well before 

that period of time. According to the FDIC’s

Resolutions Handbook, the resolution

process begins prior to a bank failure and

includes an analysis of the bank’s financial

and organizational structure, receipt of

failing bank data to assess a valuation, the

set-up of an FDIC virtual data room to

provide potential bidders information on the

failing bank, the receipt of bids on the failing

bank, and the FDIC’s selection of a

resolution strategy.

The rapid outflow of uninsured deposits

during recent failures reduced the FDIC’s

resolution preparation lead time from days

to hours. The reduced timeframe impacted 

the FDIC’s ability to receive and validate 

bank data submissions from the failing

banks for the establishment of an FDIC

virtual data room for potential bidders.

In an August 14, 2023 speech regarding the

failures of Silicon Valley Bank, Signature 

Bank, and First Republic Bank, the FDIC

Chairman highlighted these data issues and 

noted shortcomings in the FDIC’s 2012 rule

requiring that large banks with over $50 

billion in assets submit resolution plans.

Specifically, the Chairman noted that the 

FDIC was hindered in receiving prompt and

reliable information from failed banks; the 

FDIC did not have information on bank key

personnel and retention plans, critical bank

third parties, and bank payment and trading 

activities; and the FDIC did not have 

communications systems and strategies to 

reach internal and external stakeholders.

As noted by the FDIC Chairman, “[w]hile 

Silicon Valley Bank and First Republic had

been required to file resolution plans which 

provided basic information that was useful,

far more robust plans would have been 

helpful in dealing with the failure of these 

institutions. Signature Bank failed before it

would have been required to file its first

resolution plan in June.”

Further, large bank failures also leave the

FDIC with limited resolution options. For

example, the FDIC can sell a failed bank or

portions of its assets to another bank;

however, such a transaction may increase

the asset size and the systemic risk of the

purchasing bank. Alternatively, the FDI

Act’s systemic risk exception may be

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 217
invoked—as was the case for Silicon Valley

Bank and Signature Bank—when there is a 

serious adverse effect on economic

conditions or financial stability. When 

invoked, the systemic risk exception allows

the FDIC to resolve banks using different

methods, including resolutions that may not

be the least costly to the DIF. Use of the

systemic risk exception may require that

certain banks that had no involvement with 

the failed bank pay for the failed bank

management’s missteps.

In a series of rulemakings, the FDIC and

other banking regulators are taking steps to 

address identified large bank resolution 

shortcomings. On September 18, 2023,

banking regulators issued a Notice of

Proposed Rulemaking that would revise 

regulatory capital requirements for banks

with assets of $100 billion or more and for

other banks with significant trading activity.

Among other things, the proposed rule 

would change regulatory capital ratio 

calculations to reflect the banks’ ability to 

absorb losses by, for example, requiring

banks to include net unrealized losses on 

securities held as available for sale in the 

calculation of regulatory capital. The 

proposed rule has a 3-year phase-in

requirement.

On September 19, 2023, banking regulators

issued a second Notice of Proposed 

Rulemaking, requiring insured depository

institutions with more than $100 billion in 

assets to maintain a minimum amount of

long-term debt. The debt is intended to act

as a “buffer” to absorb losses in the event of

a bank failure, thereby providing regulators

with greater flexibility to respond to the 

failure and reduce costs to the DIF.

Currently, only the largest, global

systemically important financial companies

are required to hold long-term debt as part

of their total loss absorbing capacity

requirement.

Also, on September 19, 2023, the FDIC

issued a third Notice of Proposed 

Rulemaking, revising a current rule requiring 

the submission of resolution information for

insured depository institutions with $50 

billion or more in total assets. The

proposed rule requires that insured

institutions with $100 billion or more in 

assets provide a full resolution plan that

includes a strategy for its orderly and 

efficient resolution, including demonstrating 

the capability to provide needed information

such as establishing a virtual data room with 

information for potential bidding parties.

Additionally, on October 11, 2023, the FDIC

issued a fourth Notice of Proposed 

Rulemaking, providing new guidance for

large banks with assets of $10 billion or

more that raises the FDIC’s standards for

corporate governance, risk management,

and controls commensurate with the size,

business model, risk, and complexity of

larger banks.

Further, the FDIC issued a Request for

Information and Comment on Rules,

Regulations, Guidance and Statements of

Policy Regarding Bank Merger Transactions

to receive “comments regarding the 

effectiveness of the existing framework in 

meeting the requirements of section 18(c) of

the Federal Deposit Insurance Act (known 

as the Bank Merger Act)” including, among 

other things, the financial stability risks

resulting from the merger of large banks.

As noted by the OCC Acting Comptroller of

the Currency, there is a resolvability gap for

the very largest regional banks subject to 

the FDI Act. Should such a bank fail, the

FDIC may face limited resolution options

that could result in the FDIC selling the 

bank, or a large portion of its assets, to a

systemically important financial

company, thereby making the SIFC even 

larger and more systemic.

Preparing for an Orderly 

Liquidation 

The FDIC has not been required to execute 

an OLA resolution; however, it is critical that

the FDIC remain ready to do so. In our

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 218
•

•

evaluation report, The FDIC’s Orderly 

Liquidation Authority, we determined that

the FDIC has made progress in

implementing elements of its OLA program, 

including progress in OLA resolution 

planning for global SIFCs based in the U.S. 

However, we found that in the more than 12 

years since the enactment of the DoddFrank Act, the FDIC has not maintained a 

consistent focus on maturing the OLA 

program and has not fully established key 

elements to execute its OLA responsibilities. 

Specifically: 

• OLA Policies and Procedures.

The FDIC has made significant

progress in developing high-level

policies and procedures for the

execution of an OLA resolution of a

systemically important bank holding

company. However, it has not

completed operational-level policies

and procedures, nor identified how it

would need to adjust its policies and

procedures for an OLA resolution of

other types of SIFCs. In addition, the

FDIC has not developed two

regulations required by the DoddFrank Act or completed policies and

procedures for ongoing OLA

resolution planning activities.

5

OLA Roles and Responsibilities.

The FDIC has not fully defined

governance and individual

practitioner-level roles and

responsibilities related to the

execution of an OLA resolution.

OLA Resources, Training, and

Exercises. The FDIC needs to

obtain additional staff resources to 

plan for an OLA resolution, and to

fully identify and document the staff

and contractor resources necessary

to execute an OLA resolution. In

addition, the FDIC needs to enhance 

OLA-related training and exercises

to regularly ensure that personnel

have the skills needed to execute an

OLA resolution.

• Monitoring of OLA Activities. The

FDIC does not have adequate

monitoring mechanisms in place to

ensure it promptly implements the

OLA program and consistently

measures, monitors, and reports on

the OLA program status and results.

• Crisis Readiness-Related

Planning. The FDIC has not

documented a readiness plan for

executing OLA resolution authorities

in a financial crisis scenario involving

concurrent failures of multiple

SIFCs.

Absent a consistent focus and fully 

established key elements for executing the 

OLA, the FDIC may not be able to readily 

meet the OLA requirements for every type 

of SIFC that the FDIC may be required to 

resolve. If the FDIC were unable to resolve 

a SIFC, the banking sector and the stability

of the U.S. and global financial systems 

could be severely affected. The FDIC is

addressing the 17 recommendations we 

made to improve key elements for executing 

the FDIC’s OLA responsibilities.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 219
•

•

•

•

Identifying Cybersecurity Risks in the Financial Sector 

Key Areas of Concern

In addition to the Advanced and 

Intermediate IT examiner staffing 

challenges described in the Strategic 

Human Capital Management at the FDIC 

section of this Report, the primary areas of 

concern for this Challenge are: 

Examining for Bank Third-Party

Service Provider Cybersecurity Risk

Improving Bank IT Examination

Processes

Ensuring FDIC Staff Have Requisite

Financial Technology Skills

Continuing to Assess Risks Posed

by Emerging Technology

In its Risk Review 2023, the FDIC 

recognized that the “banking industry’s 

information technology infrastructure 

remains vulnerable to cyber attacks.” 

Similarly, in its Semiannual Risk 

Perspective Spring 2023, the Office of the 

Comptroller of the Currency (OCC) found 

that risks to banks “continue[s] to be 

elevated as cyberattacks evolve and 

become more sophisticated and damaging 

to the U.S. economy.” Both the FDIC and 

OCC have highlighted increased attacks 

against the banking industry through a 

particular variety of cyber attack known as 

ransomware. According to the OCC, 

ransomware attacks “have the potential to 

affect banks and market operations by 

rendering critical data inaccessible as well 

as by threatening the confidentiality of 

customer data through data leaks.” In the 

2023 Risk Management Association’s

survey of 100 community bank executives, 

85 percent of executives stated that 

cybersecurity was their top risk. 

Cybersecurity risks to banks include threats 

directed towards a bank’s IT infrastructure 

and through attacks on banks’ third-party 

service providers. In its Risk Review 2023, 

the FDIC found that “[c]yber threats to thirdparty providers of software, hardware, and 

computing services remain an important 

source of risk to the financial industry.” For 

example, in August 2023, M&T Bank

customer information—names, addresses,

and account numbers—was compromised

through a cybersecurity incident involving

file transfer software used by one of the

bank’s third-party service providers.6

 

Examining for Bank Third-Party 

Service Provider Cybersecurity

Risk 

Banks routinely rely on third parties for 

numerous activities, including IT services, 

accounting, compliance, human resources, 

loan servicing, and document processing. 

In its Risk Review 2023, the FDIC identified 

multiple security risks to banks from the 

compromise of a third-party service 

provider, including “disclosure of credentials 

or confidential data, corruption of data, 

installation of malware, and application

outages.” In addition, multiple banks may 

rely on the same third-party service 

providers. FSOC has recognized that 

banks’ “concentrated dependency on a 

limited number of service providers... [is] a 

potential risk to financial stability.” Bank 

third-party risk becomes more complex 

when a bank’s third party relies on other 

vendors, thereby introducing fourth-party 

risk to a bank.7

 In the Interagency 

Guidance on Third-Party Relationships: 

Risk Management, bank regulators noted

that a bank’s “use of third parties does not

diminish or remove banking organizations’ 

responsibilities to ensure that activities are 

performed in a safe and sound manner and 

in compliance with applicable laws and 

regulations.” 

The Bank Service Company Act (BSC Act) 

authorizes the FDIC to directly examine 

third-party service providers that offer 

services to supervised banks. The BSC Act 

also requires that banks notify their primary 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 220
regulator of third-party service provider

relationships. Further, during bank IT

examinations, the FDIC collects information 

regarding bank and third-party relationships.

Regulators have divided third-party service

providers into two tiers based on the risks

the service provider poses to the banking

sector: Significant Service Providers (SSP)

that serve large numbers of banks and pose

a higher degree of systemic risk, and

Regional Service Providers (RSP) that

serve fewer banks and pose less risk. In 

2012, banking regulators jointly developed 

guidance for risk-based examinations of

service providers.

8

In our memorandum, the FDIC’s Regional 

Service Provider Examination Program, our

objective was to assess the effectiveness of

the FDIC’s RSP examination program

related to third-party risks to financial

institutions. Overall, we found that the FDIC

had not established performance goals,

metrics, and indicators to measure overall

program effectiveness and efficiency. As a 

result, we were unable to conclude on the

program’s effectiveness; however, we 

identified opportunities to improve the RSP

examination program. We found that the 

FDIC should (1) monitor RSP examination 

distribution timeliness; (2) comply with

examination frequency guidelines; (3)

provide additional guidance on how to use 

RSP examinations in support of the FDIC’s

InTREx program (discussed in the next

section below); and (4) establish a 

comprehensive inventory of FDICsupervised bank service providers and the 

financial institutions serviced.

Significantly, our audit found that only 25 

percent (18 of 71) of examinations were 

performed consistent with interagency

guidance on examination frequency. 

Further, the FDIC has an opportunity to

leverage available service provider

information obtained through its InTREx and 

service provider examination programs to 

develop a comprehensive inventory of

FDIC-supervised bank service providers.

We made one recommendation to the FDIC

to conduct a formal assessment of the RSP

examination program to establish programlevel goals, metrics, and indicators and

determine whether additional resources and

controls are needed to improve program

effectiveness.

A full picture of the interconnected nature of

IT and cybersecurity risks among banks and 

third parties would be helpful for examiners

to understand the full scope of cybersecurity

risks—rather than risks solely for a single 

bank or third party. This information would 

also help FDIC policymakers to ensure that

FDIC policies and examination procedures

appropriately assess and address

interconnected risks. Further, in the event

of a cybersecurity incident, a mapping of

bank and third-party relationships may allow

the FDIC to quickly identify the parties at

risk and may provide relevant threat

information and supervisory guidance to

mitigate such risk as well as prepare for

potential resolutions.

Improving Bank IT Examination 

Processes 

FDIC IT examinations identify areas in 

which a financial institution is exposed to IT 

and cyber-related risks and evaluate bank

management’s ability to identify these risks

and maintain appropriate compensating

controls. FDIC IT examiners follow an 

examination program that utilizes a riskbased approach to assess IT and cyber

risks at financial institutions.

In our OIG evaluation, Implementation of

the FDIC’s Information Technology Risk 

Examination (InTREx) Program, we found

weaknesses in the FDIC’s InTREx program

that limited FDIC examiners’ ability to 

assess and address IT and cyber risks at

financial institutions. For example, we 

found that examiners did not complete 

InTREx procedures and decision factors

required to support their ratings. Without

effective implementation of the InTREx

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FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 221
program, significant IT and cyber risks may

not be identified by examiners and 

addressed by financial institutions. Further,

an inaccurate assessment of IT risks could 

affect a bank’s safety and soundness rating,

which may require adjustments to the 

FDIC’s supervisory strategies and

examination planning for the bank and may

also impact the insurance premium paid by

a financial institution. The FDIC has

addressed 10 of 19 recommendations we 

made to improve its InTREx examination 

processes and is working to implement the 

remaining 9 recommendations.

Ensuring FDIC Staff Have 

Requisite Financial Technology 

Skills 

In its September 2023 report, Agencies Can

Better Support Workforce Expertise and

Measure the Performance of Innovation 

Offices, the GAO reviewed banking 

regulators’ financial technology expertise.

Financial technology includes a broad range 

of technology underlying bank products and 

services. The GAO found that the FDIC

and other banking regulators “have not

systematically or comprehensively collected 

data on their policymaking and oversight

staff’s technological skills related to financial

technology or conducted assessments to 

determine the financial technology skills

these staff need. The agencies also have 

not measured the effectiveness of their

financial technology training in addressing

their skill need.”

Incorporating skillset assessments and

measurements can help agencies ensure

that staff have the skills needed to conduct

effective policymaking and oversight of

financial technology. The GAO made one 

recommendation to the FDIC to collect staff

skillset data and determine the critical 

financial technology skills the Agency

needs; develop targeted strategies to 

address financial technology-related skill 

gaps; and measure the effectiveness of its

financial technology-related training in

addressing skill needs.

Continuing to Assess Risks Posed 

by Emerging Technologies 

In its 2023 Report on Cybersecurity and

Resilience, the FDIC identified emerging

financial sector cybersecurity threats from

artificial intelligence (AI) and quantum

computing. Specifically, the FDIC noted

that AI may help bad actors create and 

refine malware that can be used to infect

computer systems. AI may also be used to 

create malicious information, such as emails

and voicemails, where the recipient—such 

as a bank customer—may be unable to

distinguish AI-generated information from a

trusted person or source—such as the

bank. Further, AI may be used by malicious

actors to commit synthetic fraud by creating

a new person using stolen and AI-generated

information.9 It may be difficult for banks

and regulators to identify such fraud.

The FDIC also noted that current data 

encryption methods may be vulnerable to

the speed and power of quantum

computing. For example, in May 2022, the

Administration issued a National Security

Memorandum, noting certain types of

quantum computers could “defeat security

protocols for most Internet-based financial

transactions.” The FDIC should continue to 

monitor risks posed by emerging

technologies and ensure that necessary

adjustments are made to policies,

examinations, and examiner training to

address such risks.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 222
Assessing Crypto-Asset Risk 

Key Areas of Concern

The primary areas of concern for this

Challenge are:

• Assessing the Impact of CryptoAsset Risks to FDIC-Supervised

Banks

• Clarifying Processes for Supervisory

Feedback Regarding Bank CryptoAsset-Related Activities

FSOC describes crypto assets as privatesector digital assets that depend primarily

on the use of cryptography and distributed

ledger or similar technologies. In its Report

on Digital Asset Financial Stability Risks

and Regulation 2022, FSOC noted that

“[c]rypto-asset activities could pose risks to 

the stability of the U.S. financial system if

their interconnections with the traditional

financial system or their overall scale were 

to grow without adherence to or being 

paired with appropriate regulations,

including the enforcement of the existing 

regulatory structure.” In its Annual Report

2023, FSOC noted that “some traditional

financial firms were affected by shocks in 

the crypto-asset market.” As noted by the

Congressional Research Service, the

failures of Silvergate, Silicon Valley, and 

Signature Banks “demonstrate that volatility

in crypto markets may expose banks to

liquidity risks that could ultimately lead to

fatal losses.”

The total market capitalization of crypto

assets fluctuated from about $132 billion in

January 2019 rising to $3 trillion in

November 2021. In September 2023,

crypto-asset market capitalization fell to 

about $1 trillion. Further, on January 10,

2024, the Securities and Exchange 

Commission approved 11 applications for

spot bitcoin exchange traded funds, which 

allow investors to purchase exposure to 

bitcoin without directly holding bitcoin.

According to FDIC data, as of September

2023, a total of 42 FDIC-supervised banks

engaged in crypto-asset-related activities.

Crypto-asset-related activities included, for

example, deposit services, crypto-asset

collateralized lending, and facilitation of

customer purchase and sale of crypto 

assets through a third party.

Assessing the Impact of CryptoAsset Risks to FDIC-Supervised 

Banks 

The March 2, 2022 Executive Order on

Ensuring Responsible Development of

Digital Assets stated, among other things,

that three of the principal policy objectives

of the Administration regarding digital

assets were to protect consumers,

investors, and businesses; protect U.S. and 

global financial stability and mitigate 

systemic risk; and mitigate illicit finance and

national security risks posed by digital asset

misuse. In the January 2023 Joint

Statement on Crypto-Asset Risks to

Banking Organizations and the February

2023 Joint Statement on Liquidity Risks to

Banking Organizations Resulting from

Crypto-Asset Market Vulnerabilities, 

banking regulators highlighted risks to 

banks from involvement with crypto assets

and crypto-asset sector participants. In

general, digital asset risks include:

• Liquidity, Concentration, and

Contagion Risk. Banks face

liquidity risks from crypto-asset

market volatility and the resulting

deposit flows associated with cryptoasset entity customers (such as a

crypto exchange). For example,

bank liquidity may be impacted by

the size and timing of deposit inflows

and outflows made by a crypto

exchange on behalf of its customers.

Further, deposits associated with

crypto-asset reserves related to

stable coins are susceptible to stable

coin run risk, creating potential

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 223
deposit outflows for banks. Liquidity 

risk can be acute when a cryptorelated entity’s business represents 

a significant portion—or 

concentration—of a bank’s capital, 

client, or business base. In addition, 

interconnections among crypto-asset 

participants—such as through 

lending, investing, funding, service, 

and operational arrangements—may 

cause losses for one participant to 

quickly flow to other participants. 

• Fraud, Illicit Finance, and

Cybersecurity Risk. Crypto-asset

sector participants may not have

mature and robust governance

processes to manage risks. Absent

oversight and governance

processes, there is an increased risk

of fraud, illicit activities, and

cybersecurity vulnerabilities within

the crypto-asset sector. Banks

without effective due diligence

processes may not have full insight

into the activities of crypto-asset

sector participants. Without effective

due diligence and risk management,

banks may face fines, reputational

risks, and cybersecurity risks as a

result of the banks’ involvement with

crypto-asset participant activities.

• Consumer Protection Risks.

According to the Comprehensive

Framework for Responsible

Development of Digital Assets, 16

percent of American adults

(approximately 53 million people)

have purchased digital assets.

Crypto-asset companies may make

inaccurate or misleading

representations and disclosures,

including misrepresentations

regarding Federal deposit insurance,

and other practices that may be

unfair, deceptive, or abusive,

contributing to significant harm to

retail and institutional investors,

customers, and counterparties. For

example, the bankruptcy filings from

crypto-asset company Prime Trust 

detailed how the company locked 

itself out of its own cryptocurrency 

wallet and used fiat currencies from 

its client accounts to meet 

withdrawal requests. Banks 

engaged with crypto-asset sector 

participants may have exposure to 

these risks.

In our report, FDIC Strategies Related to 

Crypto-Asset Risks, we found that the FDIC

has identified risks with banks’ involvement

with crypto-related activities; however, the 

FDIC has not assessed the significance and 

potential impact of these risks. Specifically, 

the FDIC has not conducted risk 

assessments to determine the significance 

of crypto-asset activity risks and the 

magnitude of the impact, likelihood of 

occurrence, and nature of the risks. Also, 

the FDIC has not developed mitigation 

strategies, such as issuing guidance to 

financial institutions, to ensure that risks are 

within defined risk tolerances. We 

recommended that the FDIC establish a 

plan with timeframes for assessing risks 

pertaining to crypto-related activities.

Until the FDIC assesses the risks of crypto 

activities and provides supervised 

institutions with effective guidance, the 

FDIC and some FDIC-supervised 

institutions may not take appropriate actions 

to address the most significant risks posed 

by crypto assets. Similarly, examiners may 

not have guidance concerning the safety 

and soundness and consumer protection 

risks of banks’ involvement with crypto 

assets and crypto-asset participants. As a 

result, as banks continue to implement 

crypto-asset strategies, bank management 

and FDIC examiners may not identify and 

mitigate the most significant crypto-asset 

risks, which could lead to unsafe and 

unsound practices, consumer harm, or in 

severe instances, financial instability. 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 224
Clarifying Processes for 

Supervisory Feedback Regarding 

Bank Crypto-Asset-Related 

Activities 

On April 7, 2022, the FDIC issued Financial 

Institution Letter, Notification and 

Supervisory Feedback Procedures for 

FDIC-Supervised Institutions Engaging in 

Crypto-Related Activities, requesting that

FDIC-supervised institutions notify the FDIC 

if they intended to engage in, or were 

currently engaged in, crypto-related 

activities. The Letter stated that the FDIC 

would review the notification, request 

additional information as needed, and 

provide relevant supervisory feedback to the 

FDIC-supervised institution, as appropriate, 

in a timely manner.

In our report, FDIC Strategies Related to 

Crypto-Asset Risks, we found that the

FDIC’s process for providing supervisory

feedback to FDIC-supervised institutions 

about their crypto-related activities is 

unclear. Between March 2022 and May 

2023, the FDIC sent letters (pause letters) 

to certain FDIC-supervised institutions 

asking them to pause from proceeding with 

planned or expanded crypto activities and 

provide additional information. The FDIC 

asked the institutions to pause their 

activities in order to review the institutions’

crypto-related activities before providing

supervisory feedback. 

For this pause letter process, the FDIC did 

not establish a timeframe for reviewing 

submitted information, responding to the 

institutions, and describing what constituted 

the end of the FDIC’s review process. The 

FDIC’s lack of clear procedures and timely 

feedback regarding crypto-asset activities 

causes uncertainty for supervised 

institutions in determining the appropriate 

actions to take. Absent timely feedback 

from the FDIC and clarity regarding the end 

of the FDIC’s review process for paused 

crypto-related activities, the FDIC may be 

viewed as not being supportive of financial 

institutions engaging in crypto-related 

activities. We recommended that the FDIC 

update and clarify review timeframes and 

completion.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 225
•

•

•

•

Protecting Consumer Interests and 

Promoting Economic Inclusion 

Key Areas of Concern 

In addition to the DCP examiner staffing 

challenges described in the Strategic 

Human Capital Management at the FDIC 

section of this Report, the primary areas of 

concern for this Challenge are: 

Assessing Risks in Bank Consumer

Services Models

Improving the FDIC’s Ability to

Increase Economic Inclusion

Preparing to Examine for Changes

to the Community Reinvestment Act

Addressing Misuse of the FDIC

Name and Misrepresentation of

Deposit Insurance

According to the FDIC’s 2021 National 

Survey of Unbanked and Underbanked 

Households, 96 percent of U.S. households

(about 126 million in 2023) had bank

accounts. In serving these households, 

banks must keep depositors’ funds safe and 

treat consumers fairly, especially as banks 

introduce new technologies. For the 4 

percent (about 5 million in 2023) of 

households without a bank account, the 

World Bank notes the importance of helping 

these households because access to a

bank account is “a first step toward broader 

financial inclusion since a transaction 

account allows people to store money, and 

send and receive payments.” 

FDIC consumer programs and examinations 

seek to ensure that consumers with bank 

accounts are treated fairly in accordance 

with consumer laws and regulations. For 

those Americans without bank accounts, 

FDIC programs encourage inclusion of 

these individuals in the banking system to 

provide safe and affordable savings and 

credit solutions to improve household 

financial stability and resilience. 

Assessing Risks in Bank Consumer 

Services Models 

The Congressional Research Service has 

noted that banks are becoming increasingly 

reliant on new technology—especially AI 

and Machine Learning (ML). Such 

technology may benefit banks by allowing 

for “greater speed, accuracy, and 

confidence in loan decisions” but also 

introduce risks to consumers. In testimony

to the U.S. House of Representatives, 

Committee on Financial Services, the OCC 

Deputy Comptroller of the Currency for 

Operational Risk Policy outlined key 

consumer risks for new technology, 

including:

• Explainability. Banks must be able

to understand and explain AI

decision-making processes. Absent

explainability, banks may be unable

to ensure compliance with laws and

regulations, validate model

outcomes, and ensure the absence

of bias in the models’ design.

• Data management. Banks should

also understand data origins, use,

and governance of analytic models

to guard against unintended or

illegal decision outcomes.

• Privacy and security. Banks must

ensure the privacy and security of

sensitive consumer data used by AI

models.

• Third-party risk. Banks are also

expected to have robust due

diligence, effective contract

management, and ongoing oversight

of third parties based on the

criticality of the services being

provided.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 226
On March 31, 2021, banking regulators

issued a Request for Information and 

Comment on Financial Institutions’ Use of

AI, Including Machine Learning (AI RFI) to 

obtain information on banks’ risk

management processes for AI, challenges

to AI adoption or use, and potential benefits

to the banks for its use. Regulators are 

continuing to review information received 

from the AI RFI. Also, on October 30, 2023,

the Administration issued the Executive 

Order on Safe, Secure, and Trustworthy

Artificial Intelligence, which established 

standards for AI safety and security to 

promote innovation while protecting

American consumers’ privacy and civil

rights.

The FDIC should ensure that its consumer

protection examination procedures have 

processes to assess banks’ use of AI and

ML, and issue timely supervisory guidance 

to banks as needed. Further, the FDIC

should ensure that its consumer compliance 

examination staff has sufficient skills to

identify AI and ML model risk. DCP recently

established a branch in the Washington

Office to support DCP in assessing banks’

use of emerging technologies and to

monitor consumer protection risks of

emerging technologies.

Improving the FDIC’s Ability to 

Increase Economic Inclusion 

In June 2019, the FDIC published its

updated Economic Inclusion Strategic Plan

(EISP) to guide its efforts to promote and 

expand economic inclusion. In our report,

FDIC Efforts to Increase Consumer

Participation in the Insured Banking System, 

we assessed whether the FDIC developed 

and implemented an effective EISP to

increase participation in the insured banking 

system. We found that the FDIC’s plan 

aligned with several strategic planning best

practices. However, opportunities existed to

strengthen the effectiveness of future EISPs

by incorporating additional strategic

planning best practices into the strategic

planning process. These additional best

practices included: performing a 

comprehensive assessment of the 

landscape; identifying strategies and 

developing outcome-based performance 

measures to assess progress towards

desired goals; and identifying resources

needed to achieve desired goals and

address risks that could affect achievement

of goals.

We also found that the FDIC can take steps

to improve the implementation of future 

EISPs by aligning internal resources to 

achieve program objectives and measuring 

the outcomes of its economic inclusion 

efforts. Additionally, the FDIC’s Enterprise 

Risk Management risk mitigation strategies

to address economic inclusion efforts could

more clearly address risks related to

implementing strategic objectives, effective 

controls, and responsive programs to 

promote economic inclusion. Collectively,

these actions would help management

make the best use of Agency resources,

ensure accountability, monitor progress,

and make the EISP more effective in 

promoting economic inclusion. We made

14 recommendations to the FDIC to 

improve the development and

implementation of EISPs, including the

FDIC’s new EISP that was under

development at the time of our report.

Preparing to Examine for Changes 

to the Community Reinvestment 

Act 

The FDIC must also ensure that it has

required resources to devote towards

changes to the Community Reinvestment

Act (CRA). The purpose of the CRA is to 

encourage banks to help meet the credit

needs of the communities in which they do 

business, including low- and moderateincome communities, consistent with safe 

and sound operations. On October 24,

2023, banking regulators issued a final rule

that implements a revised regulatory

framework based on a bank’s asset size 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 227
and business model that uses performance 

tests to evaluate a bank’s performance in 

meeting the credit needs of its entire 

community. 

Implementation of new CRA regulations will 

require significant time and effort for the 

FDIC and the other banking agencies to 

revise examination policies and procedures; 

modify IT applications and systems; train 

examiners; and provide guidance and 

conduct bank outreach efforts. Given the 

staffing challenges discussed in the 

Strategic Human Capital Management at 

the FDIC section of this Report, DCP will 

need to ensure that it has sufficient staffing 

to address CRA-related changes. 

Addressing Misuse of the FDIC 

Name and Misrepresentation of 

Deposit Insurance 

The FDI Act prohibits any person from 

misusing the FDIC name or logo, or making 

misrepresentations about deposit insurance. 

The FDIC may investigate any claims under 

this section and may issue administrative 

enforcement actions, including cease and 

desist orders, and impose civil money 

penalties against perpetrators. Between 

July 2022 and June 2023, the FDIC issued 

12 letters to non-banks requiring that the 

recipients stop making false and misleading 

statements regarding FDIC deposit 

insurance and take immediate action to 

address these misleading and false 

statements or to provide documentation that 

their claims were true and accurate. 

In June 2022, the FDIC issued a final rule

on its “procedures for identifying,

investigating, and where necessary taking 

formal and informal action to address 

potential violations.” In addition, in 

December 2023, the FDIC adopted a final 

rule to modernize its regulations governing

use of the official FDIC signs and 

advertising statements, and to clarify the 

FDIC’s regulations regarding false 

advertising, misrepresentations of deposit 

insurance coverage, and misuse of the 

FDIC’s name or logo. Also, on January 19, 

2024 the FDIC issued a press release

stating that it demanded that five entities 

cease and desist from making false and 

misleading statements about FDIC 

insurance.

The FDIC obtains information on potential 

deposit insurance misrepresentations 

through various methods, including three 

public portals. Two portals are monitored 

by DCP, and the third portal is monitored by 

the Legal Division. The FDIC also scans 

websites for potential fraudulent use of the 

FDIC logo. We also receive information 

regarding potential deposit insurance 

misrepresentations through our OIG Hotline. 

The FDIC should ensure that identified 

potential misuse and misrepresentations are 

investigated and action is taken to address 

violations.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 228
•

•

•

•

•

•

•

•

•

Fortifying IT Security at the FDIC 

Key Areas of Concern 

The primary areas of concern for this 

Challenge are:

Strengthening the FDIC’s

Information Security Profile

Improving Information Security

Controls

Managing Systems Migration to the

Cloud

Protecting the FDIC’s Wireless

Network

Assessing the FDIC’s Ransomware

Attack Readiness

The GAO continues to recognize 

cybersecurity as a high risk to Federal 

agencies, as it has since 1997. According 

to the Federal Information Security 

Modernization Act of 2014 Annual Report 

Fiscal Year 2022, there were 30,659 

reported Federal Government cybersecurity 

incidents in Fiscal Year 2022, which is a 5.7 

percent increase from Fiscal Year 2021. 

The FDIC relies on information and systems 

to execute its mission. In 2023, the FDIC 

had five multi-year capital IT projects 

collectively totaling nearly $1 billion—the 

largest of which is the Chief Information 

Officer Organization’s (CIOO) $862 million 

contract for data services. These systems 

contain sensitive information, such as 

names, Social Security Numbers, and bank 

account numbers for roughly 5,700 FDIC 

employees, about 4,300 contractors, and 

millions of depositors of failed financial 

institutions; confidential bank examination 

information, including supervisory ratings; 

and sensitive financial data. A 

cybersecurity incident could expose these 

FDIC-held data and impair FDIC mission 

capabilities, particularly during a crisis. 

Strengthening the FDIC’s 

Information Security Profile 

The Federal Information Security 

Modernization Act of 2014 requires Federal 

agencies, including the FDIC, to conduct 

annual independent evaluations of their 

information security programs and 

practices. In our OIG report, The FDIC’s 

Information Security Program – 2023 , we

evaluated the effectiveness of the FDIC’s 

information security program and practices. 

While the FDIC’s overall information 

security program was operating at a Level 4 

of 5, meaning managed and measurable, 

we found security control weaknesses that 

reduced the effectiveness of the FDIC’s 

information security program and practices 

that could be improved:

The FDIC needs to fully implement a

software inventory automation

program to manage security risks for

software that is approaching or has

reached its end-of-life or end-ofservice.

The FDIC’s Supply Chain Risk

Management program lacks

maturity.

The FDIC did not remove accounts

belonging to separated personnel in

a timely manner.

The FDIC did not configure

privileged accounts in accordance

with the principle of “Least Privilege.”

We identified security risks in

several instances where accounts

were configured with elevated

account settings that were not

needed for administrators to perform

their business roles, as well as other

instances where users had elevated

access longer than needed.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 229
• The FDIC needs to enforce

cybersecurity and privacy

awareness training requirements.

The FDIC is working to implement the two 

recommendations we made in our report to

address these control weaknesses.

Improving Information Security 

Controls 

The FDIC should ensure that only

individuals with a business need are 

allowed access to FDIC systems and

information. The FDIC uses Active 

Directory to centrally manage user

identification, authentication, and 

authorization for systems access. Active 

Directory infrastructure is an attractive 

target for attackers because the same 

functionality that grants legitimate users

access to systems and data can be hijacked

by malicious actors for nefarious purposes.

Therefore, it is paramount for the FDIC to 

ensure that it is adequately protecting its

Active Directory infrastructure.

In our OIG report, The FDIC's Security

Controls Over Microsoft Windows Active 

Directory, we found that the FDIC had not

fully established and implemented effective 

controls for securing and managing the

Active Directory to protect the FDIC’s

network, systems, and data in 7 of 12 areas

tested. These seven areas included 

password management, account

configuration, access management,

privileged account management, windows

operating system maintenance, active 

directory policies and procedures, and audit

logging and monitoring. The FDIC’s

ineffective Active Directory security controls

could pose significant risks to FDIC data

and systems. The FDIC has addressed 5 of

the 15 recommendations we made to 

improve Active Directory security controls

and is working to implement the remaining

10 recommendations.

In addition, in a memorandum to the FDIC

during our audit, The FDIC’s Information

Security Program—2022, we noted potential

information security and privacy issues 

concerning the FDIC’s process to review

emails flagged by certain automated tools

used to detect and minimize exfiltration of

information. This process presented 

security and privacy risks that FDIC

employees and/or contractors could be

inadvertently exposed to information that

they would otherwise not be permitted to

review, and safety risks that emails relevant

to urgent law enforcement matters would 

not be received by the OIG in a timely

manner.

In March 2023, the CIOO provided a plan to

update systems and processes to ensure

the confidential and timely receipt of OIG

email from complainants, whistleblowers,

and law enforcement partners. The FDIC

has communicated that it has approved 

funding to further on-going efforts that the 

CIOO intends to take during 2024 to

modernize the FDIC and OIG email

infrastructure. Successful implementation,

to include the resolution of technical

challenges (including mail handling/data

loss protection), is critical to meet the OIG’s

mission and maintain its independence.

Managing Systems Migration to 

the Cloud 

The FDIC has been moving systems into a 

cloud environment and plans to have most

of its mission essential and mission critical

systems operating in the cloud by 2026. In

our OIG report, The FDIC’s Adoption of

Cloud Computing Services, we assessed

whether the FDIC has an effective strategy

and governance processes to manage its

cloud computing services. We found that

overall, the FDIC had an effective strategy

and governance processes to manage its

cloud computing services. However, the 

FDIC did not adhere to several cloudrelated practices recommended by the 

Office of Management and Budget (OMB),

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 230
National Institute of Standards and

Technology (NIST), and FDIC guidance. As

a result, controls over cloud computing

posed increased risks to the FDIC, including 

security and privacy concerns due to the 

lack of visibility into cloud data, an inability

to effectively move from one existing cloud

services provider to another, not identifying

and mitigating performance risks and 

vulnerabilities in cloud contracts, and

increased potential for cyber attacks and

costs from the lack of disposal strategies for

legacy systems.

The FDIC addressed three of nine 

recommendations we made to address

these deficiencies and continues to address

the remaining six recommendations. We

also have work ongoing to assess FDIC

cloud security.

Protecting the FDIC’s Wireless 

Network 

The FDIC provides wireless access (WiFi)

throughout its facilities. Absent effective 

security controls, WiFi access provides an 

avenue into FDIC systems that could 

compromise the confidentiality, availability,

and integrity of FDIC data and systems.

In our OIG report, Security Controls Over

the FDIC’s Wireless Network, we found that

the FDIC did not comply or partially

complied with five practices recommended 

by NIST and guidance from the FDIC and

other Federal agencies. As a result, the 

FDIC faced potential security risks based 

upon its then-current wireless practices and

controls, including unauthorized access to 

the FDIC networks and insecure wireless

devices broadcasting WiFi signals. The

FDIC has addressed three of eight

recommendations to strengthen FDIC

wireless networks and is working to address

the remaining five recommendations.

Assessing the FDIC’s Ransomware 

Attack Readiness 

Government agencies are being targeted by

ransomware attacks involving malicious

software that encrypts files, rendering them

unusable until the victim pays a ransom to 

the perpetrator. For example, according to 

the GAO, in February 2023, the U.S.

Marshals Service suffered a ransomware 

attack with perpetrators gaining access to 

sensitive information, including

investigations and employees’ personal

data. In its 2023 Risk Review, the FDIC

noted in particular that “[r]ansomware 

continues to pose a significant threat to U.S.

critical infrastructure sectors, including

finance and banking, as the number of

attacks continues to increase.”

In addition to information security

safeguards, the FDIC should have effective 

processes to address a potential

ransomware attack. A ransomware attack

on the FDIC could hinder the FDIC’s ability

to resolve failed banks, issue deposit

insurance payments to bank account

holders, examine and supervise financial

institutions, and manage receiverships.

Disruption of any of these FDIC core 

functions could lead to financial system

instability, including a loss of public

confidence in the FDIC’s ability to pay

depositors.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 231
•

•

•

•

Strengthening FDIC Contract and 

Supply Chain Management 

Key Areas of Concern 

The primary areas of concern for this 

Challenge are: 

Improving Contract Management

Addressing Supply Chain Risk

Management

Ensuring Contractors Are

Appropriately Vetted and Are Not

Performing Inherently Governmental

Functions

Ensuring Whistleblower Rights and

Protections for Contractor Personnel

Agencies should effectively manage their 

acquisitions process in order to ensure that 

contract requirements are defined clearly 

and all aspects of contracts are fulfilled. 

Agencies are also required to ensure that 

contractor personnel are vetted and 

performing appropriate tasks. Further, 

agencies should assess the risks of their 

goods and services supply chains. 

According to NIST “adversaries are using 

the supply chain as an attack vector and [as 

an] effective means of penetrating [United 

States’ public and private] systems, 

compromising the integrity of system 

elements, and gaining access to critical 

assets.” For example, in June 2023, it was 

reported that several Federal agencies 

suffered a cyber intrusion where malicious 

actors exploited a vulnerability in a 

contracted software application.10

Improving Contract Management 

In 2023, the FDIC awarded 634 contracts 

for a total of $1.3 billion. GAO reviews of 

FDIC financial statements and our OIG 

reports have demonstrated a need for the 

FDIC to improve its contract management. 

In its 2020, 2021, and 2022 audits of FDIC 

financial statements, the GAO identified 

deficiencies in the FDIC’s internal controls 

over contract documentation and paymentreview processes. These deficiencies 

increased the risk that improper payments 

could occur and FDIC operating expenses

and accounts payable could be misstated. 

Collectively, these weaknesses represented 

a significant deficiency11 in the FDIC’s

internal controls over its financial reporting. 

Notably, the FDIC has been working to 

improve its contracting internal controls and 

there was no contracting significant 

deficiency for the 2023 financial statement 

audit.

In three recent OIG reports, we have found 

shortcomings in the FDIC’s contract 

management process and internal controls:

• Lack of Change Management

Resulted in Abandonment of a

Nearly $10 Million Investment

Towards a New Acquisition

System. In our evaluation The

FDIC’s Purchase and Deployment of

the FDIC Acquisition Management

System (FAMS), we found that the

primary reason for the unsuccessful

systems acquisition procurement

was that the FDIC did not employ an

effective change management

process. The FDIC had initiated a

contract to procure a new acquisition

system, in part, to address

weaknesses in its existing systems

that were identified in our report,

Contract Oversight Management. In

June 2022, the FDIC began

implementation of its new acquisition

system but subsequently abandoned

that system within 5 months. As a

result, the FDIC incurred contract

and labor-hour costs of nearly

$10 million and had to revert to its

legacy acquisition systems and

manual reporting of some acquisition

activities. We made three

recommendations to the FDIC to

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 232
improve change management. We 

also identified $9.9 million of funds 

to be put to better use.

• Internal Control Failures and an

Unaccountable Culture Resulted

in an Unauthorized Contractual

Commitment of $4.2 Million and a

Contract Price $1.5 Million Above

Market Value. In our report, FDIC

Oversight of a Telecommunications

Contract, we found that the FDIC did

not authorize and pay AT&T for

services to upgrade bandwidth in the

FDIC Field Offices in accordance

with its policies and procedures and

existing telecommunications

contract. The FDIC did not adhere

to its acquisition policies and

procedures for a number of reasons.

The FDIC’s former CIO had not

established an accountable

organizational culture nor an

appropriate internal control

environment to ensure compliance

with FDIC acquisition policies and

procedures. The FDIC CIOO and

DOA did not implement proper

internal controls for the AT&T

contract. Additionally, the FDIC did

not include risks related to the FDIC

CIOO’s reliance on contractor

services and the need to maintain an

effective internal control environment

for its contract oversight

management activities in the FDIC

Enterprise Risk Management’s Risk

Inventory. Further, certain FDIC

CIOO personnel did not fulfill their

roles and responsibilities. As a

result, the FDIC was subject to an

unauthorized contractual

commitment that cost the FDIC $4.2

million and a prolonged increase in

operational, monetary, legal, and

reputational risks. Further, we found

that the FDIC incurred costs above

the market price for similar services

in the amount of at least $1.5 million.

The FDIC has addressed 10 of 14

recommendations we made to

improve organizational culture and

establish internal controls. 

• Lack of Contract Management

Plans to Ensure Inherent

Performance Risks and Contract

Vulnerabilities Were Managed

Appropriately. In our report, The

FDIC’s Adoption of Cloud

Computing Services, we found that

the FDIC did not develop Contract

Management Plans (CMP) for any of

our sampled 17 cloud computingrelated contracts with a total value of

over $546 million. We further

assessed 93 active IT-related

contracts and found that 91 of these

93 contracts had CMPs, but those

91 CMPs were not in place by

required timeframes. CMPs are

developed to document a common

understanding of contractor and

FDIC obligations and provide a

strategy for managing key contract

vulnerabilities or performance areas

inherent in the contract, and any

unique contract terms and

conditions. Absent CMPs, the FDIC

may not monitor performance

measures, respond to missed

metrics, and enforce contract

penalties in a consistent manner, all

of which could lead to inefficient use

of resources and disruption to FDIC

operations. The FDIC addressed

three of nine recommendations we

made to address these deficiencies

and continues to work to address the

remaining six recommendations.

The FDIC must also ensure that employees 

involved in contracting do not have conflicts 

of interest. According to the FDIC’s Ethics 

Program Advisory, Conflicts of Interest, 

FDIC employees are trusted to make

decisions and take actions to serve the 

public’s interest and should not act to enrich 

their own personal interests. The Advisory 

also notes that criminal penalties—felony 

conviction, fines, or jail time—could result 

from conflicts of interest. 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 233
Addressing Supply Chain Risk 

Management 

In our report, The FDIC’s Implementation of 

Supply Chain Risk Management, we found

that the FDIC has not implemented several 

objectives outlined in its Supply Chain Risk 

Management Implementation Project 

Charter and is not conducting supply chain 

risk assessments in accordance with best 

practices. In addition, we found that the 

FDIC has not integrated Agency-wide 

supply chain risks into its Enterprise Risk 

Management processes. The FDIC has 

addressed four of nine recommendations 

we made to improve the FDIC’s supply 

chain risk management process and is 

working to address the remaining five 

recommendations.

As part of our later OIG report, The Federal 

Deposit Insurance Corporation’s Information 

Security Program -2023, we found that the 

FDIC’s supply chain risk management 

program lacked maturity because five of 

nine recommendations from our Supply 

Chain Risk Management report remained 

outstanding. Specifically, the FDIC had not 

completed development of policies and 

procedures to address supply chain risk and 

had not conducted supply chain risk 

assessments prior to entering into contracts 

with new suppliers or when substantive 

changes were made to contracts, such as 

renewals, extensions, or exercising option

periods. Further, the FDIC had not 

established required metrics and indicators 

to monitor and evaluate supply chain risk 

and implement supply chain controls 

recommended by NIST.

Ensuring Contractors Are 

Appropriately Vetted and Are Not 

Performing Inherently 

Governmental Functions 

The FDIC budget for 2023 included $458 

million for outside services—which was the 

second highest budget category behind 

employee salary and benefit costs. As 

shown in Figure 6, the FDIC has 

consistently had about 4,000 contractors 

supporting the FDIC permanent staff of 

about 5,700. The FDIC increased 

contractor staffing in 2023 because of bank

failure activity.

Contractors must meet FDIC and 

Government-wide vetting standards before 

they may begin work at the FDIC. As part 

of our work reviewing the FDIC’s IT security 

controls, we found that the FDIC did not 

have adequate controls to ensure that 

certain contractors and employees who 

required privileged access to FDIC 

information systems and data had 

background investigations commensurate 

with appropriate determinations of risk. 

In our memorandum regarding these 

inadequate controls, Background 

Investigations for Privileged Account 

Holders, we alerted the FDIC that one

contractor who met FDIC standards in

February 2021 was granted access to a 

privileged account in April 2021. However, 

the Federal background investigation was 

not adjudicated until November 2021, and 

the adjudication was unfavorable at that 

time. Based on the adjudication, the FDIC 

ceased the privileged access and 

terminated the contractor, consistent with 

FDIC policies and procedures. The 

0

1000

2000

3000

4000

5000

6000

7000

2020 2021 2022 2023

Contractors FDIC Employees

Figure 6: FDIC Employees and Contractors 2020 to 2023

Source: OIG Analysis of FDIC Data

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 234
contractor had access to privileged 

accounts for approximately 7 months while 

the background investigation was being

adjudicated.

Also, certain functions cannot be performed 

by contractors. In OMB Policy letter 11-01,

Performance of Inherently Governmental

and Critical Functions, OMB defined these 

functions as inherently governmental

functions. OMB also required that most

agencies identify critical functions and

ensure sufficient staffing and control over

these functions.

12 OMB defined a Critical

Function as “a function that is necessary to 

the agency being able to effectively perform

and maintain control of its mission and 

operations. Typically, critical functions are

recurring and long-term in duration.”

In our OIG evaluation, Critical Functions in 

FDIC Contracts, we assessed whether an

FDIC contractor performed Critical

Functions and, if so, whether the FDIC

retained sufficient management oversight of

the contractor to maintain control of its

mission and operations in accordance with 

best practices. We found that the FDIC did 

not have policies and procedures for

identifying Critical Functions in its contracts.

Therefore, while we determined that the

contractor performed Critical Functions at

the FDIC, the FDIC did not identify these 

services as Critical Functions during its

procurement planning phase. As a result,

the FDIC also did not implement heightened 

contract monitoring. The FDIC has

addressed 11 of our 13 recommendations to 

strengthen the FDIC’s identification and

monitoring of contracts involving Critical 

Functions, and the FDIC is working to 

address the remaining 2 recommendations. 

Ensuring Whistleblower Rights and 

Protections for Contractor 

Personnel 

In our OIG report, Whistleblower Rights and

Protections for FDIC Contractors, we found

that the FDIC had not aligned its procedures

and processes with laws, regulations, and

policies designed to ensure notice to

contractor and subcontractor employees

about their whistleblower rights and 

protections. The FDIC also did not always

comply with the requirements to notify

contractors of their whistleblower rights and 

protections. The FDIC’s Legal Division did

not adopt any whistleblower rights

notification provisions for contractors or

include any whistleblower clauses in its

contracts. The FDIC also did not verify that

contractors and subcontractors notified

employees of their whistleblower rights and 

protections.

The FDIC has implemented eight of our

nine recommendations, including the Legal

Division’s adoption of whistleblower rights

notifications and inclusion of whistleblower

clauses. The FDIC is working to resolve the 

remaining recommendation to develop and 

implement procedures to ensure that

contractors carry out their obligations to 

verify that all contractor and subcontractor

personnel are notified of their whistleblower

rights and that whistleblower clauses are

included in subcontracts.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 235
•

•

•

Fortifying Governance of FDIC Programs and Data 

Key Areas of Concern 

The primary areas of concern for this 

Challenge are:

Strengthening Performance Goal

Development and Monitoring

Improving Internal Controls by

Addressing Outstanding

Recommendations

Ensuring Data Quality to Assess

Program Performance

Effective governance is critical to ensure 

that the FDIC assesses and addresses 

risks—especially those identified in this 

Report. Governance refers to a 

management framework that 

incorporates operational, financial, 

risk management, and reporting 

processes, so that FDIC Board 

Members and senior officials can 

effectively plan, govern, and meet 

strategic objectives. This includes 

ensuring alignment of goals, 

budget, and risks to achieve the 

FDIC’s mission. A governance 

framework should ensure strategic 

guidance, effective monitoring of 

management, and accountability to 

stakeholders. 

Strengthening Performance 

Goal Development and 

Monitoring

The FDIC develops and monitors its 

performance goals as part of the 

FDIC’s annual planning and budget 

process. The FDIC annual planning and 

budget process is key to providing 

resources—funding, staffing, goods, and 

services—for the FDIC to address and 

measure progress towards tackling 

identified challenges. 

As shown in Figure 7, the FDIC’s annual

planning and budget process is continual

and includes ten steps: (1) industry and 

workload analysis, (2) strategic planning, (3)

budget and performance goal development, 

(4) senior management review of the budget

and performance goals, (5) Board approval

of the budget, (6) internal FDIC

performance goal and annual performance

goal review, (7) budget monitoring, (8)

approval of internal FDIC performance

goals, (9) approval of external annual

performance goals and submission of these

goals to Congress, and (10) monitoring and

reporting budget variance and progress in

achieving FDIC internal performance goals.

The FDIC’s annual planning and budget 

process also considers risks identified 

through the FDIC’s ERM process. 

According to the GAO, ERM “is a forwardlooking approach that allows agencies to 

assess threats and opportunities that could 

affect achievement of its goals.” OMB 

Circular A-123, Management’s

Responsibility for Enterprise Risk 

Management and Internal Control, notes

Figure 7: FDIC Annual Planning and Budget Process

Source: FDIC DOF Website

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 236
that ERM should be part of an agency’s 

strategic planning, performance 

management, and performance reporting. 

In a number of our reports, we have found 

limitations in the FDIC’s development and 

monitoring of FDIC performance goals and 

a misalignment between performance goals 

and FDIC strategic plans that impeded the 

FDIC from assessing and measuring 

progress towards goal achievement. For 

example:

• Bank IT Examinations: In our

report, Implementation of the FDIC’s

Information Technology Examination

(InTREx) Program, we found that the

FDIC’s performance goal focusing

on improving its supervision program

did not focus on IT supervision

activities and did not address the

performance of IT examinations or

the effectiveness of the InTREx

Program. Also, in the RMS Division

Strategic Plan 2018-2022, RMS

established the following

performance goal: “RMS

supervision is effective, forwardlooking, and provides value-added

risk management expertise to

banks.” However, this goal does not

directly address the FDIC’s InTREx

program. Without establishing IT

examination performance goals,

objectives, and metrics, the FDIC is

unable to measure the effectiveness

of the InTREx program. Further, the

FDIC is unable to determine whether

its IT examination activities under

the InTREx program are achieving

their desired outcomes or results.

• Regional Service Provider

Examinations: In our

memorandum, The FDIC’s Regional

Service Provider Examination

Program, we found that the FDIC

has not established performance

goals or metrics to measure the

effectiveness of the RSP

examination program. Establishing

performance goals and metrics for

the RSP examination program would 

allow the FDIC to define program 

expectations and measure overall 

program efficiency and 

effectiveness, which would identify 

areas for improvement. 

• Orderly Liquidation Readiness: In

our report, The FDIC’s Orderly

Liquidation Authority, we found

limitations in the FDIC’s monitoring

and reporting of Division and

Agency-level goals and objectives

related to OLA. Specifically, we

found that monitoring and reporting

activities did not ensure OLA

resolution planning activities had

consistently and promptly

progressed since the enactment of

the Dodd-Frank Act nor did they

provide a clear picture of the overall

status of the OLA program. The

FDIC had not developed long-term

metrics and a clear definition of

success that would facilitate

consistent measuring, monitoring,

and reporting on the overall status of

the OLA program over time. Such

metrics could address key readiness

items such as the status of

readiness plans, policies and

procedures, training activities,

processes subjected to exercises,

and outstanding significant action

items from exercises.

Further, we found that in 2015, the

FDIC had established an annual

performance goal to "[e]nsure the

FDIC’s operational readiness to

resolve a large, complex financial

institution using the orderly

liquidation authority in Title II of the

DFA." A key target for reaching this

goal, identified in the FDIC Annual

Report 2015, was to “Update and

refine firm-specific resolutions [sic]

plans and strategies and develop

operational procedures for the

administration of a Title II

ANNUAL REPORT 2023 237
receivership.” The FDIC reported 

this milestone as achieved, in part 

because the FDIC had developed its 

Systemic Resolution Framework. 

However, the 2015 annual report did 

not clearly reflect the overall status 

of the OLA program, which 

continues to lack the process-level 

procedures needed for the Systemic 

Resolution Framework and the 

resolution strategies needed for an 

OLA resolution of a systemically 

important non-bank financial 

company or Financial Market 

Utility. 

• Increasing Consumer

Participation in Banking: In our

report, FDIC Efforts to Increase

Consumer Participation in the

Banking System, we found that the

FDIC could strengthen

connections between FDIC Annual

Performance Goals and DCP’s

Economic Inclusion Strategic Plan

(EISP) by ensuring that the

expressed intent of annual goals

related to DCP’s economic

inclusion efforts matched the goals

and objectives articulated in the

EISP. We also found that the FDIC

could improve the implementation of

future EISPs by aligning internal

resources to achieve program

objectives and measuring the

outcomes of its economic inclusion

efforts. Collectively, these actions

would help management make the

best use of Agency resources,

ensure accountability, monitor

progress, and make its strategic plan

more effective in promoting

economic inclusion.

Improving Internal Controls by 

Addressing Outstanding 

Recommendations 

As shown in Figure 8, as of January 31, 

2024 the FDIC had 122 OIG report

recommendations that were unimplemented 

– meaning the OIG had not received and

reviewed information from the Agency to

indicate that a recommendation should be

closed. A total of 90 percent (110 of 122) of

unimplemented recommendations were for

reports issued during Fiscal Year 2023 and

2024, while 10 percent (12 of 122) related to

reports issued between Fiscal Year 2020

and 2022.

The longest outstanding recommendation is 

for our report, Contract Oversight 

Management. In 2019, we recommended

that the FDIC provide enhanced contract 

portfolio reports to the FDIC Board of 

Directors, executives, and senior managers. 

Further, four recommendations remain 

outstanding from our 2021 report, Critical 

Functions in FDIC Contracts. As noted in 

the Strengthening FDIC Contract and

Supply Chain Management section of this 

Report, contract management remains a 

significant challenge at the FDIC and has 

been identified by the FDIC as high risk in 

the FDIC’s Risk Inventory. The FDIC Board 

and senior officials should ensure that 

program weaknesses are promptly 

resolved. If recommendations are not 

addressed expeditiously, the FDIC faces an 

increased likelihood that the underlying 

vulnerabilities or deficiencies will continue or 

recur until remediated by the FDIC.

80 67 68 37

3

1

2 9 90

20

0

20

40

60

80

100

120

140

2020 2021 2022 2023 2024

Figure 8: Unimplemented Recommendations by Fiscal Year 

Source: FDIC OIG website 

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 238
Ensuring Data Quality to Assess 

Program Performance 

Data is one of the most valuable FDIC 

assets. Analytical insights based on reliable 

data can support evidence-based decision 

making and help the FDIC build a 

performance-based culture. Reliable data 

requires effective governance of the data 

lifecycle from the point that data is entered 

into a system through the retirement of data 

records. Inadequate data governance can 

lead to higher costs, incorrect decisions, 

and reputational risks to the FDIC. Further, 

data quality is an important control in 

implementing effective use of artificial 

intelligence. Prior reports13 and three 

recent reports highlight data reliability 

issues: 

• Bank-reported Computer Security

Incidents: In our report, Sharing of

Threat and Vulnerability Information

with Financial Institutions, we

determined that the FDIC’s controls

were not effective to ensure that it

maintained complete and accurate

data in the Virtual Supervisory

Information on the Net system on all

computer-security incidents reported

by banks and service providers.

Inaccurate and incomplete incident

information may limit the FDIC’s

ability to conduct critical research

and trend analyses on threats and

vulnerabilities and impede its ability

to share accurate, complete, and

relevant information internally with

its examination staff and externally

with financial institutions.

• Human Capital Costs Related to

Economic Inclusion Efforts: In

our report, FDIC Efforts to Increase

Consumer Participation in the

Insured Banking System, we

identified data reliability issues with 

reports created out of the 

Community Affairs Reporting and 

Events System used to plan, 

monitor, and track outcomes of 

economic-inclusion related events 

and activities. As a result of data 

reliability issues, the FDIC cannot 

ensure it is allocating resources to 

its economic inclusion-related 

activities efficiently, effectively, or 

with accountability to achieve the 

Agency’s goals.

• RSP Bank Customer List: In our

memorandum, The FDIC’s Regional

Service Provider Examination

Program, we noted that the RSP

Uniform Customer List—the list

showing the banks with whom the

RSP has contractual obligations for

services—was found by the FDIC to

be unreliable. As a result, the FDIC

and other Federal banking

regulators were unable to distribute

their reports of examination for

RSPs to the banks that received the

RSP’s services.

The FDIC should have an Agency-wide 

approach to data quality. Each FDIC 

Division and Office should ensure that the 

data they gather and enter into systems is 

adequate, appropriately controlled, and 

used effectively to improve operations. 

FDIC Divisions and Offices should also 

partner with the FDIC’s Division of 

Information Technology to use technology 

to assess and test for data quality issues. 

The FDIC’s cloud migration effort includes 

data quality reviews to identify unreliable 

data prior to cloud migration, and Divisions 

and Offices should ensure that they have 

resources to address data issues as they 

are identified.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 239
1 Informal actions are voluntary commitments made by a

bank’s Board of Directors that are not legally

enforceable and are not publicly disclosed or published.

Examples of informal enforcement actions are a Bank

Board Resolution or a Memorandum of Understanding. 

Formal actions are legally enforceable and published on 

the FDIC website. Examples of formal enforcement 

actions are Consent Orders or Cease and Desist Orders.

2 According to the FDIC RMS Manual, RMS examination 

staff assess and rate six financial and operational

components - Capital adequacy, Asset quality, 

Management capabilities, Earnings sufficiency, Liquidity

position, and Sensitivity to market risk - commonly

referred to as CAMELS ratings. Examiners assign the

component and composite ratings based on a numerical

scale from 1 to 5, with 1 indicating the strongest

performance and risk management practices. A 5 rating

indicates the highest degree of supervisory concern.

3 See OIG report, Offsite Reviews of 1- and 2-Rated

Institutions (December 2019), for a description of the

Offsite Review Program.

4 The process is based on generally accepted accounting

principles.

5 The FDIC has not yet completed the following OLA

requirements to prescribe correlating rules or

regulations for: (1) 12 U.S.C. § 5390(o)(6) that requires

the FDIC, in consultation with the Secretary, to prescribe 

regulations to implement assessments of U.S. financial

companies, if such assessments are needed, to pay in

full obligations issued by the FDIC to the Treasury, and

(2) 12 U.S.C. § 5393(d) that requires the FDIC and the

FRB, in consultation with FSOC, to jointly prescribe rules

or regulations to administer and carry out a ban on

activities by senior executives and directors of failed

SIFCs if they have violated a law, regulation, or certain

agency orders; or participated in “any unsafe or unsound

practice” in connection with a financial company; or

breached their fiduciary duties. Specifically, the DFA

authorizes the FDIC or FRB, as applicable, to “prohibit

any further participation by such person, in any manner,

in the conduct of the affairs of any financial company for

a period of time determined by the appropriate agency

to be commensurate with such violation, practice, or

breach, provided such period shall be not less than 2

years.”

6 NBC, Some M&T Bank Customer Information Hacked in 

Massive Data Breach (August 30, 2023).

7 American Banker, This is the Sleeping Giant, Banks

Zero in on Fourth-Party Risk (August 4, 2023).

8 See FFIEC, Financial Regulators Release Guidance for

the Supervision of Technology Service Providers (October

31, 2012) and current guidance Supervision of

Technology Service Providers.

9 American Banker, AI Is About To Make Synthetic Fraud

A Much Bigger Problem (July 4, 2023).

10 CNN, Exclusive: US Government Agencies Hit in

Global Cyberattack (June 15, 2023).

11 A significant deficiency is a deficiency, or a

combination of deficiencies, in internal control that is

less severe than a material weakness, yet important 

enough to merit attention by those charged with

governance. A material weakness is a deficiency, or

combination of deficiencies, in internal control over

financial reporting, such that there is a reasonable

possibility that a material misstatement of the entity’s

financial statements will not be prevented, or detected

and corrected, on a timely basis. A deficiency in internal 

control exists when the design or operation of a control

does not allow management or employees, in the normal

course of performing their assigned functions, to

prevent, or detect and correct, misstatements on a

timely basis.

12 The FDIC found that Policy Letter 11-01 was not

binding on the FDIC, but the FDIC has viewed the policy

as instructive.

13 See our reports: The FDIC’s Personnel Security and

Suitability Program, where we found that contractor

position risk levels recorded in FDIC systems were

unreliable. As a result, the FDIC could not determine

whether these contractors received background

investigations commensurate with their positions. 

Termination of Bank Secrecy Act/Anti-Money Laundering

Consent Orders, where we found that the FDIC did not 

consistently track Consent Order termination data in its

system of record. As a result, the FDIC provided nine

incorrect reports to the FDIC Board of Directors

concerning enforcement actions and did not report three

BSA/AML Consent Order terminations in a quarterly

report to FinCEN. Reliability of Data in the FDIC Virtual 

Supervisory Information on the Net System, where we

found that two of the four key data elements we tested

in the FDIC’s ViSION system were not reliable. Errors in 

these data elements increase the risk of inaccurate

reporting of examination performance metrics to FDIC

management.

APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 240
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 241 

D. Acronyms 

(INCLUDES ACRONYMS IN THE FINANCIAL STATEMENTS) 

AEI Alliances for Economic Inclusion

AFS Available-For-Sale

AHDP Affordable Housing Disposition Program

AML Anti-Money Laundering

AML/CFT Anti-Money Laundering and Countering the Financing of Terrorism

ANPR Advance Notice of Proposed Rulemaking

APBO Accumulated Postretirement Benefit Obligation

ARRC Alternative Reference Rates Committee

ASBA Association of Supervisors of Banks of the Americas

ASC Accounting Standards Codification 

BCBS Basel Committee on Banking Supervision

BDC Backup Data Center

BIF Bank Insurance Fund

BIPOC Black, Indigenous, and People of Color

BoA Bank of America

BOA Basic Ordering Agreement

BPM Business Process Modernization

Call Report Consolidated Reports of Condition and Income

CAMELS Capital adequacy; Asset quality; Management capabilites; Earnings 

sufficiency; Liquidity position; Sensitivity to market risk

CBAC Advisory Committee on Community Banking

CCPs Central Counterparties

CDFI Community Development Financial Institution

CECL Current Expected Credit Losses

CEO Chief Executive Officer

CFO Act Chief Financial Officers Act

CFPB Consumer Financial Protection Bureau
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 242 

CFR Center for Financial Research

CFT Countering the Financing of Terrorism

CFTC Commodity Futures Trading Commission

CIO Chief Information Officer

CIOO Chief Information Officer Organization

CISR Division of Complex Institution Supervision and Resolution

CMG Crisis Management Group

CMP Civil Money Penalty

ComE-IN Advisory Committee on Economic Inclusion

COVID-19 Coronavirus Disease 2019

CRA Community Reinvestment Act

CRC Consumer Response Center

CRE Commercial Real Estate

CSBS Conference of State Bank Supervisors

CSRS Civil Service Retirement System

DCP Division of Depositor and Consumer Protection

DEIA Diversity, Equity, Inclusion, and Accessibility

DIF Deposit Insurance Fund

DIR Division of Insurance and Research

DOA Division of Administration

Dodd-Frank Act Dodd-Frank Wall Street Reform and Consumer Protection 

Act of 2010

DRR Division of Resolutions and Receiverships

EDIE Electronic Deposit Insurance Estimator

ERM Enterprise Risk Management

EU European Union

FASB Financial Accounting Standards Board

FBO Foreign Banking Organization

FCB First Citizens Bank & Trust Company

FDI Act Federal Deposit Insurance Act
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 243 

FDIC Federal Deposit Insurance Corporation

FEHB Federal Employees Health Benefits

FERS Federal Employees Retirement System

FFB Federal Financing Bank

FFIEC Federal Financial Institutions Examination Council

FFMIA Federal Financial Management Improvement Act

FHFA Federal Housing Finance Agency

FID Financial Institution Diversity

FIL Financial Institution Letter

FinCEN Financial Crimes Enforcement Network

Fintech Financial Technology Company

FIRREA Financial Institutions Reform, Recovery and Enforcement Act

FISs Financial Institution Specialists

FISMA Federal Information Security Modernization Act of 2014

FMFIA Federal Managers’ Financial Integrity Act

FOCUS Framework for Oversight of Compliance and CRA Activities 

User Suite

FRB Board of Governors of the Federal Reserve System

FRF FSLIC Resolution Fund

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

FTC Federal Trade Commission

FTE Full-Time Equivalent

GAAP Generally Accepted Accounting Principles

GAO U.S. Government Accountability Office

GPRA Government Performance and Results Act

G-SIBs Global Systemically Important Banks

G-SIFIs Global Systemically Important Financial Institutions
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 244 

HBCU Historically Black Colleges and Universities

IADI International Association of Deposit Insurers

IDI Insured Depository Institution

IMF International Monetary Fund

IT Information Technology

LCFI Large Complex Financial Institution

LIBOR London Inter-bank Offered Rate

LIDI Large Insured Depository Institution

LMF Labor Management Forum

LMI Low- and Moderate-Income

LURAs Land Use Restriction Agreements

ME/MC Mission Essential/Mission Critical

MDI Minority Depository Institutions

MOL Maximum Obligation Limitation

MOU Memorandum of Understanding

MRBA Matters Requiring Board Attention

MSSP Managed Security Services Provider

MWOB Minority- and Women-Owned Business

MWOLF Minority-and Women-Owned Law Firms

N.A. National Association

NAMWOLF National Association of Minority-and Women-Owned Law Firms

NCDA National Center for Consumer and Depositor Assistance

NCUA National Credit Union Administration

NIM Net Interest Margin

NPR Notice of Proposed Rulemaking

NSFR Net Stable Funding Ratio

NTEU National Treasury Employees Union

OCC Office of the Comptroller of the Currency

OIG Office of Inspector General
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 245 

OLA Orderly Liquidation Authority

OMB U.S. Office of Management and Budget

OMWI Office of Minority and Women Inclusion

OO Office of the Ombudsman

OPM Office of Personnel Management

ORMIC Office of Risk Management and Internal Controls

OTS Office of Thrift Supervision

PAVE Property Appraisal and Valuation Equity

PMN Purchase Money Note

PPE Primary Purpose Exception

QFC Qualified Financial Contract

REFCORP Resolution Funding Corporation

ResG Financial Stability Board’s Resolution Steering Committee

RFI Request For Information

RMS Division of Risk Management Supervision

ROE Reports of Examination

ROU Right-of-Use

RTC Resolution Trust Corporation

SAIF Savings Association Insurance Fund

SARC Supervision Appeals Review Committee

SEC Securities and Exchange Commission

SIFI Systemically Important Financial Institution

SLA Shared-Loss Agreement

SNC Shared National Credit

SPPS Security and Privacy Professional Services

SRAC Systemic Resolution Advisory Committee

SRR SIFI Risk Report

SSGN Structured Sale Of Guaranteed Note

SVB Silicon Valley Bank
APPENDICES

FEDERAL DEPOSIT INSURANCE CORPORATION ANNUAL REPORT 2023 246 

SVBB Silicon Valley Bridge Bank, N.A.

TAG Transaction Account Guarantee Program

TDR Troubled Debt Restructuring

TSP Federal Thrift Savings Plan

UDAA Unclaimed Deposits Amendments Act of 1993

UFIRS Uniform Financial Institutions Rating System

UK United Kingdom

U.S. United States

USD U.S. Dollar

Treasury U.S. Treasury

VIE Variable Interest Entity
2023

Federal Deposit 

Insurance Corporation

This 2023 Annual Report is dedicated to Bret D. Edwards, CFO, for his 

35 1⁄2 years of public service. We express our sincere gratitude and thanks 

for all the hard work and many accomplishments over the years. Thank 

you for your service! Congratulations and best wishes in retirement. 

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 

 Barbara A. Glasby

 Steven M. Holler

 Judy Lee 

 Financial Reporting Section Staff

 Division and Office Points-of-Contact

FEDERAL DEPOSIT INSURANCE CORPORATION
550 17th Street, N.W.

Washington, DC 20429-9990

www.fdic.gov

FDIC-003-2024