Troubled Asset Relief Program: Status of the Wind Down of the Capital Purchase Program
Published: 2014-04-07T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: CPP was established as the primary means of restoring stability to the financial system under the Troubled Asset Relief Program (TARP). Under CPP, Treasury invested almost $205 billion in 707 eligible financial institutions between October 2008 and December 2009. CPP recipients have made dividend and interest payments to Treasury on the investments. TARP's authorizing legislation requires GAO to report every 60 days on TARP activities. This report examines (1) the status of CPP and (2) the financial condition of institutions remaining in the program.
To assess the program's status, GAO reviewed Treasury reports on the status of CPP. GAO also used financial and regulatory data to compare the financial condition of institutions remaining in CPP with those that had exited the program and those that did not participate. GAO also obtained information through a questionnaire from CPP participants as of November 20, 2013, and former CPP participants that raised capital in calendar year 2013. GAO received completed questionnaires from 72 of the 104 institutions.
GAO provided a draft of this report to Treasury for its review and comment. Treasury generally concurred with GAO's findings.
section_title: What GAO Found
paragraphs: The Department of Treasury (Treasury) continues to make progress in winding down the Capital Purchase Program (CPP). As of January 31, 2014, Treasury's data showed that 624 of the original 707 institutions, or about 88 percent, had exited CPP. Treasury had received about $225 billion from its CPP investments, exceeding the approximately $205 billion it had disbursed. Most institutions exited by repurchasing their preferred shares in full or by refinancing their investments through other federal programs. Treasury also continues to sell its investments in the institutions through auctions; a strategy first implemented in March 2012 to expedite the exit of a number of CPP participants. As of January 31, 2014, Treasury has sold all or part of its CPP investment in 162 institutions through auctions, receiving a total of about 80 percent of the principal amount. A relatively small number of the remaining 83 institutions accounted for most of the outstanding investments. Specifically, 10 institutions accounted for $1.5 billion or about 73 percent of the $2.1 billion in outstanding investments. Treasury estimated a lifetime gain of $16.1 billion for CPP as of November 30, 2013.
GAO's analysis of financial data found that the institutions remaining in CPP were generally less financially healthy than those that have exited or that never participated. In particular, the remaining CPP institutions tended to be less profitable, hold riskier assets, and have lower capital levels and reserves. Most remaining participants also have missed scheduled dividend or interest payments, with 60 missing their November 2013 payment. Further, 47 of the remaining CPP institutions were on the Federal Deposit Insurance Corporation's problem bank list in December 2013—that is, they demonstrated financial, operational, or managerial weaknesses that threatened their continued financial viability. Institutions that continue to miss dividend payments or find themselves on the problem bank list may have difficulty fully repaying their CPP investments because federal and state bank regulators may not allow these institutions to make dividend payments or repurchase outstanding CPP shares in an effort to preserve their capital and promote safety and soundness.

section_title: Letter
paragraphs: From October 2008 through December 2009, the Department of the  Treasury (Treasury) invested almost $205 billion in 707 financial  institutions as part of the government’s efforts to help stabilize U.S.  financial markets and the economy. These investments were made  through the Capital Purchase Program (CPP), the first and largest  initiative under the Troubled Asset Relief Program (TARP). TARP gave  Treasury the authority to buy or guarantee up to $700 billion of the  “troubled assets” that were believed to be at the heart of the financial  crisis, including mortgages, mortgage-backed securities, and any other  financial instruments deemed appropriate, such as equity investments.  Under this authority, in October 2008 Treasury created CPP to provide  capital to viable financial institutions by purchasing preferred shares and  subordinated debt. In return for its investments, Treasury received  dividend or interest payments and warrants. The program was closed to  new investments on December 31, 2009, and since then Treasury has  continued to oversee and divest its CPP investments, collect dividend and  interest payments, and sell warrants. As of January 31, 2014, 624 CPP  participants had exited the program, many by repurchasing their preferred  shares or subordinated debt after consultation with their primary bank  regulators.
This report is based on our continuing analysis and monitoring of  Treasury’s activities in implementing the Emergency Economic  Stabilization Act of 2008 (EESA), which provided us with broad oversight  authorities for actions taken under TARP and required that we report at  least every 60 days on TARP activities and performance. To fulfill our  statutorily mandated responsibilities, we have been monitoring and  providing updates on TARP programs, including CPP. This report  examines (1) the status of CPP, including repayments and other  proceeds, as well as investments outstanding; and (2) the financial  condition of institutions remaining in CPP.
To assess the status of CPP, we analyzed Treasury reports on  outstanding CPP investments, dividends paid, and the number of  institutions that made full repayments. We also sent a questionnaire to  current CPP participants as of November 20, 2013, and former CPP  participants that raised capital during calendar year 2013 asking if the  upcoming increase in the interest or dividend rate on CPP securities had  an impact on their efforts to exit the program and/or retire any outstanding  CPP securities. We received completed questionnaires from 72 of the  104 institutions. To assess the financial condition of institutions that  received investments under CPP, we used financial and regulatory data  from SNL Financial to compare CPP participants remaining in the  program with those that had exited the program and those that had never  participated. We have assessed the reliability of SNL Financial data as  part of previous studies through interviews with SNL officials and testing  of SNL data against filed regulatory documents. We determined that the  financial information we used was sufficiently reliable for the purposes of  this report. We also leveraged our past reporting on TARP, as well as that  of the Special Inspector General for TARP, as appropriate. Appendix I  has more information on our scope and methodology.
We conducted this performance audit from December 2013 to April 2014  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: Created in 2008, CPP was the primary initiative under TARP to help  stabilize the financial markets and banking system by providing capital to  qualifying regulated financial institutions through the purchase of senior  preferred shares and subordinated debt. Rather than purchasing  troubled mortgage-backed securities and whole loans, as initially  envisioned under TARP, Treasury used CPP investments to strengthen  financial institutions’ capital levels. Treasury determined that  strengthening capital levels was the more effective mechanism to help  stabilize financial markets, encourage interbank lending, and increase  confidence in lenders and investors. Treasury believed that strengthening  the capital positions of viable financial institutions would enhance  confidence in the institutions themselves and the financial system overall  and increase the institutions’ capacity to undertake new lending and  support the economy. On October 14, 2008, Treasury allocated $250  billion of the original $700 billion in overall TARP funds for CPP. The  allocation was subsequently reduced in March 2009 to reflect lower  estimated funding needs, as evidenced by actual participation rates, and  the program was closed to new investments on December 31, 2009.
Under CPP, qualified financial institutions were eligible to receive an  investment of between 1 and 3 percent of their risk-weighted assets, up to  a maximum of $25 billion. In exchange for the investment, Treasury  generally received senior preferred shares that would pay dividends at a  rate of 5 percent annually for the first 5 years and 9 percent annually   CPP investments made in late 2008 began paying the higher  thereafter.dividend or interest rate in late 2013 whereas the remaining investments  will see the increase begin sometime in 2014. EESA required that  Treasury also receive warrants to purchase shares of common or  preferred stock or a senior debt instrument to further protect taxpayers  and help ensure returns on the investments. Institutions are allowed to  repay CPP investments with the approval of their primary federal bank  regulator and afterward to repurchase warrants.
section_title: Treasury Continues to Make Progress in Winding Down the CPP Program
paragraphs: As of January 31, 2014, a total of 624 of the 707 institutions that originally  participated in CPP, about 88 percent, had exited the program. Of the 624  institutions that exited CPP, 239 institutions repurchased their preferred  shares or subordinated debentures in full (see fig. 1). Another 165  institutions refinanced their shares through other federal programs: 28  through the Community Development Capital Initiative (CDCI) and 137   An additional 162  through the Small Business Lending Fund (SBLF).institutions had their investments sold through auction and 29 institutions  went into bankruptcy or receivership. The remaining 29 had their  investments sold by Treasury (25), or merged with another institution (4).
Repayments and income from dividends, interest, and warrants from CPP  investments have exceeded the amounts originally disbursed. Treasury  disbursed $204.9 billion to 707 financial institutions nationwide from  October 2008 through December 2009. As of January 31, 2014, Treasury  had received $225 billion in repayments and income from its CPP  investments, exceeding the amount originally disbursed by $20.1 billion  (see fig. 2).in repayments and $2.8 billion in auction sales of original CPP  investments as well as $18.9 billion in dividends, interest, and other  income and $8.0 billion in warrants sold. After accounting for write-offs  and realized losses totaling $4.7 billion, CPP had $2.1 billion in   The repayments and income amount include $195.3 billion  outstanding investments as of January 31, 2014. Treasury estimated a  lifetime gain of $16.1 billion for CPP as of November 30, 2013.
subsections: section_title: Impact of Increasing Dividend or Interest Rate on CPP Securities Varies
paragraphs: About half of the institutions (37 of 72) that responded to our  questionnaire about the impact of the upcoming or recent increase in the  dividend or interest rate on CPP securities stated that it impacted or is  impacting their efforts to exit the CPP program and/or retire any  outstanding CPP securities.that the institutions are taking a range of actions. Some institutions  indicated that the increase led them to raise alternative capital. For  example, one institution completed a public offering of common stock and  used the proceeds to redeem its CPP shares. Others indicated that they  are working with Treasury to participate in a future auction or attempting  to negotiate with Treasury to restructure the CPP debt. Still others  commented that the increase in the interest or dividend rate will increase  the burden on the institution, make it more difficult to raise alternative  capital, and further reduce their ability to exit the program. Thirty-three  institutions responded that the increase did not or is not impacting their  efforts to exit the program or retire CPP securities.
section_title: Remaining Capital Purchase Program Investment Concentrated in a Few Institutions
paragraphs: As of January 31, 2014, the 83 remaining institutions accounted for the  $2.1 billion in outstanding investments or about 1 percent of the original  investment. The outstanding investments were concentrated in a  relatively small number of institutions. Specifically, the 10 largest  remaining CPP investments accounted for $1.5 billion (73 percent) of  outstanding investments and 2 institutions accounted for more than half of  this amount (see fig. 3). In contrast, the remaining $557 million (24  percent) was spread among the other 73 institutions.
As of January 31, 2014, the number of states with at least one institution  with CPP investments outstanding was 28, and the number of states with  at least 5 such institutions was 7 (see fig. 4). California had the highest  number of remaining CPP institutions with 8, followed by Illinois with 7. In  terms of total CPP investments outstanding, Puerto Rico had the largest  amount ($1.2 billion), followed by North Carolina ($108 million), Virginia  ($91 million), and Florida ($74 million).
section_title: Treasury Continues to Utilize Auctions as a Means of Winding Down the Program
paragraphs: Treasury began selling its investments in banks through auctions  beginning in March 2012 as a way to balance the speed of exiting the  investments with maximizing returns for taxpayers. As of January 31,  2014, Treasury had conducted a total of 23 auctions and received a total  of about 80 percent of the principal amount (see fig. 5). As figure 5  shows, the total proceeds from selling securities do not include any  income received from repurchases, dividends, or other sources or any  missed dividend or interest payments, the rights to which are sold with the  securities. For example, if an institution whose securities were being sold  by Treasury at auction had missed $100,000 worth of dividend payments,  the purchaser of the securities would own the right to receive those past- due dividends if the institution can pay them. As of January 31, 2014,  Treasury has sold all or part of its investments in 162 institutions, through  the auction process, including the rights to approximately $207 million in  missed dividends and interest payments.
In 2013, we reported that according to Treasury officials, the auction  results reflected the potential risk associated with the liquidity of the  investments, the credit quality of the financial institutions (including their  ability to make future dividend or interest payments), and the prospect of  receiving previous missed payments that had accrued. For example,  later auctions have tended to include smaller institutions with more  cumulative missed payments. In a few cases, the prospect of recouping  these missed payments made the institutions particularly attractive to  investors and helped raise the sale price of those securities above their  par value. Although Treasury has not generally recouped its full  investment in individual institutions through the auctions, in 2013,  Treasury officials told us that accepting a discount and transferring  ownership of these institutions to the private sector was in the best  interest of the taxpayer. Because of the inherent risk factors of these  institutions, Treasury officials did not anticipate that they would be able to  make full repayments in the near future. The officials added that had they  chosen not to auction these positions, their values could have decreased  later. Treasury officials also said that while auctions were generally priced  at a discount to the principal amount, the prices were generally equal to  or above Treasury’s internal valuations.
section_title: Remaining CPP Institutions Are Generally Less Financially Healthy Than Those That Have Exited
paragraphs: Institutions that remain in CPP tend to be financially weaker than  institutions that have exited the program and institutions that did not  receive CPP capital. Our analysis considered various measures that  describe banking institutions’ profitability, asset quality, capital adequacy,  and ability to cover losses. We analyzed financial data on the 83  institutions remaining in CPP as of January 31, 2014, and 482 former  CPP institutions, which we split into three groups: (1) those that repaid  their investments, (2) those that exited through an auction, and (3) those  that refinanced their investments through SBLF. The current and former  CPP institutions in our analysis accounted for 565 of the 707 institutions  that participated in CPP. We compared the 565 institutions to a non-CPP  group (i.e., institutions that have not participated in CPP) of 7,177 active  financial institutions for which financial information was available. All  financial information generally reflects quarterly regulatory filings on  December 31, 2013.
Table 1 provides the results of our analysis of these measures, including  the following.
Mostly smaller institutions remain in the program and larger  institutions tended to exit through repayment. For example, institutions  that exited through repayment had a median asset size of $1.7 billion,  compared with $548 million for those that refinanced through SBLF  and $385 million for those that exited through an auction.
In the aggregate, the remaining institutions were noticeably less  financially healthy than each of the groups of former CPP participants.
As a group, institutions that exited through auctions were significantly  less financially healthy than the group of institutions that repaid their  investments or refinanced through SBLF.
Overall, the institutions that remain in CPP are less financially healthy  than both the group of institutions that never participated in CPP and  the aggregate group that had exited CPP.
In particular, remaining CPP institutions had noticeably higher median  Texas Ratios than each group of former CPP institutions as well as the  non-CPP group. The Texas Ratio helps determine a bank’s likelihood of  failure by comparing its troubled loans to its capital. The higher the ratio,  the more likely the institution is to fail. As of December 31, 2013,  remaining CPP institutions had a median Texas Ratio of 53.21, compared  with 19.58 for former CPP institutions and 12.37 for the non-CPP group.  Further, of the institutions that exited CPP, those that exited through  auctions had the highest median Texas Ratio (33.90), compared with  those that exited through full repayments (17.18) or by refinancing to  SBLF (15.03).
Profitability measures for remaining CPP institutions were lower than  those for former CPP participants and the non-CPP group. For example,  the median return on average assets measure shows how profitable a  company is relative to its total assets and how efficient management is at  using its assets to generate earnings. For the quarter ending December  31, 2013, remaining CPP institutions had a median return on average  assets of 0.30, compared with 0.77 for former CPP institutions and 0.75  for the non-CPP group. Further, among the institutions that had exited  CPP, those that participated in Treasury’s auctions had the lowest return  on average assets at 0.56, compared with 0.86 for those that repaid their  investments and 0.76 for those that refinanced to SBLF.
Remaining CPP institutions also held relatively more poorly performing  assets. For example, remaining CPP institutions had a higher median  percentage of noncurrent loans than former CPP institutions and the non- CPP group. As of December 31, 2013, a median of 2.83 percent of loans  for remaining CPP institutions were noncurrent, compared with 1.33  percent for former CPP institutions and 1.05 percent for the non-CPP  group. Remaining CPP institutions had a median ratio of net charge-offs  to average loans (0.18) about equal to that of former CPP institutions  (0.20), but a higher median ratio than the non-CPP group (0.09), as of  December 31, 2013.had higher values than institutions that made full repayments or  refinanced to SBLF.
For both of these ratios, the auction participants  Compared with former CPP institutions and the non-CPP group,  remaining CPP institutions held less regulatory capital as a percentage of  assets. Regulators require minimum amounts of capital to lessen an  institution’s risk of default and improve its ability to sustain operating  losses. Regulatory capital can be measured in several ways, but we  focused on Tier 1 capital, which includes both a common-equity capital  ratio and a Tier 1 capital ratio, because it is the most stable form of  regulatory capital.capital as a share of risk-weighted assets, and the common equity Tier 1  ratio measures common equity Tier 1 as a share of risk-weighted assets,  which generally does not include TARP funds. Using these measures, the  remaining CPP institutions had lower median Tier 1 capital levels than  former CPP institutions and the non-CPP group. The remaining CPP  institutions also had a median common equity Tier 1 capital ratio below  that of the former CPP institutions and the non-CPP group. As of  December 31, 2013, the median common equity Tier 1 capital ratio for  remaining CPP institutions was 10.48 percent of risk-weighted assets,  compared with 11.76 percent for former CPP institutions and 15.48  percent for the non-CPP group.
The Tier 1 risk-based capital ratio measures Tier 1  Finally, remaining CPP institutions had significantly lower reserves for  covering losses compared with former CPP institutions and the non-CPP  group. As of December 31, 2013, the median ratio of reserves to  nonperforming loans was lower for remaining CPP institutions (41.92)  than for former CPP participants (70.37) and the non-CPP group (76.16).  Of those institutions that have exited the program, auction participants  had the lowest ratio (55.35), compared with 77.34 for those that repaid  their investments and 84.06 for those that refinanced to SBLF.
subsections: section_title: Most Remaining CPP Participants Have Missed Dividend or Interest Payments
paragraphs: The number of CPP participating institutions missing dividend or interest  payments in a given quarter increased steadily from 8 in February 2009 to  159 in August 2011 and has since declined each quarter to 60 in  November 2013 (see fig. 6). Almost 84 percent, or 75 of the 89 financial  institutions remaining in CPP as of November 30, 2013, have missed a  dividend payment. Most of the institutions with missed payments have  missed them in several quarters. In particular, all but one of the  institutions that missed payments in November 2013 had also missed  payments in each of the previous three quarters. Moreover, the 60  institutions that missed payments in November 2013 had an average of  13 missed payments.
Institutions can elect whether to pay dividends and may choose not to pay  for a variety of reasons, including decisions that they or their federal and  state regulators make to conserve cash and maintain (or increase) capital  levels. Institutions are required to pay dividends only if they declare  dividends, although unpaid cumulative dividends generally accrue and the  institution must pay them before making payments to other types of  shareholders, such as holders of common stock. However, investors view  a company’s ability to pay dividends as an indicator of its financial  strength and may see failure to pay full dividends as a sign of financial  weakness.
section_title: The Number of Remaining CPP Institutions on FDIC’s Problem Bank List Has Declined
paragraphs: Showing a similar trend to missed dividend or interest payments, the  number of CPP institutions on the Federal Deposit Insurance  Corporation’s (FDIC) “problem bank list” has decreased in recent months  after months of steady increases. This list is a compilation of banks with  demonstrated financial, operational, or managerial weaknesses that  threaten their continued financial viability and is publicly reported on a  quarterly basis. As of December 31, 2013, 47 CPP institutions were on  the problem bank list (see fig. 7). The number of these institutions  increased every quarter beginning in March 2009, hitting a high of 134 in  June 2011, even as the number of institutions participating in CPP  declined. As figure 7 shows, the number of problem banks fell slightly for  the first time in the third quarter of 2011 and has declined to 47 as of  December 31, 2013. Federal and state bank regulators may not allow  institutions on the problem bank list to make dividend payments in an  effort to preserve their capital and promote safety and soundness.
These observations are consistent with the analysis in our May 2013 and  March 2012 reports, which also showed that the remaining CPP  institutions were financially weaker than institutions that had exited the  program and institutions that did not receive CPP capital.
section_title: Agency Comments
paragraphs: We provided a draft of this report to Treasury for its review and comment.  Treasury provided written comments that we have reprinted in appendix II.  In its written comments, Treasury generally concurred with our findings.   Treasury noted that it had realized a positive return of $20.19 billion as of  April1, 2014, and that 71 institutions remained in the program representing  a remaining investment of $1.96 billion. Treasury also emphasized its  commitment to keeping the public informed of its progress in winding down  CPP.
We are sending copies of this report to the Special Inspector General for  TARP, interested congressional committees and members, and Treasury.  The report also is available at no charge on the GAO website at  http://www.gao.gov.
If you or your staffs have any questions about this report, please contact  A. Nicole Clowers at (202) 512-8678 or clowersa@gao.gov. Contact  points for our Offices of Congressional Relations and Public Affairs may  be found on the last page of this report. GAO staff who made major  contributions to this report are listed in appendix III.
section_title: Appendix I: Objectives, Scope, and Methodology
paragraphs: The objectives of our report were to examine (1) the status of the Capital  Purchase Program (CPP), including repayments and other proceeds, as  well as investments outstanding; and (2) the financial condition of  institutions remaining in CPP. To assess the status of CPP at the  program level, we analyzed data from the Department of the Treasury  (Treasury). In particular, we used Treasury’s January 2014 Monthly  Report to Congress to determine the dollar amounts of outstanding  investments, the number of remaining and former participants, and the  geographical distribution of each as of January 31, 2014.
To assess the financial condition of institutions that received investments  under CPP, we used data from Treasury’s Dividends and Interest reports  from February 2009 through November 2013 to determine the extent to  which participants had missed payments throughout the life of the  program. To assess whether the upcoming 2014 increase in the dividend  or interest rate on CPP securities was impacting CPP participants’ efforts  to exit the program and/or retire CPP securities, we sent an email  containing two questions to all current CPP participants (89) and any past  CPP participants that raised capital in calendar year 2013. The first  question asked if the increase had impacted them (Yes or No) and, if yes,  to describe actions taken. We sent the questionnaire to 104 institutions  and received responses from 72. We used the “actions taken” responses  to provide examples of how the increase in the dividend or interest rate  on CPP securities is impacting CPP participants. We defined current CPP  participants to be those institutions that Treasury classifies as “full  investment outstanding; warrants outstanding,” “full investment  outstanding; warrants not outstanding,” and “sold in part, warrants  outstanding” in its November 20, 2013 TARP transaction report. We  identified those CPP participants that raised capital in calendar year 2013  using the SNL database.
We also obtained from the Federal Deposit Insurance Corporation (FDIC)  summary information on its quarterly problem bank list to show the trend  of CPP institutions appearing on the list from December 2008 through  December 2013. We used financial measures for depository institutions  that we had identified in our previous reporting on CPP. These measures  help demonstrate an institution’s financial health as it relates to a number  of categories, including profitability, asset quality, capital adequacy, and  loss coverage. We obtained such financial data for depository institutions  using a private financial database provided by SNL Financial that  contains publicly filed regulatory and financial reports. We merged the  data with SNL Financial’s CPP participant list to create the three  comparison groups—remaining CPP institutions, former CPP institutions,  and a non-CPP group comprised of all institutions that did not participate  in CPP.
We analyzed financial data on the 83 institutions remaining in CPP as of  January 31, 2014, and 482 former CPP institutions that exited CPP  through full repayments, conversion to the Small Business Lending Fund,  or Treasury’s sale of its investments through an auction, accounting for  565 of the 707 CPP participants. We identified the 83 institutions  remaining in CPP as of January 31, 2014, using Treasury’s January 2014  Monthly Report to Congress. The 142 CPP institutions our analysis  excluded had no data available in SNL Financial, had been acquired, or  were defunct. We compared the remaining and former CPP institutions to  a non-CPP group of 7,177 active financial institutions for which financial  information was available. We chose to present median values. Financial  data were available from SNL Financial for 440 of the 565 CPP  institutions, and we accounted for the remaining 125 institutions using  SNL Financial information for the holding company or its largest  subsidiary. Although this approach has limitations such as excluding other  financial subsidiaries, we deemed it to be sufficient for the purpose of our  work. All financial information reflects quarterly regulatory filings on  December 31, 2013, unless otherwise noted. We downloaded all financial  data from SNL Financial on March 4, 2014. Finally, we leveraged our past  reporting on the Troubled Asset Relief Program (TARP), as well as that of  the Special Inspector General for TARP, as appropriate.
We determined that the financial information used in this report, including  CPP program data from Treasury and financial data on institutions from  SNL Financial, was sufficiently reliable to assess the condition and status  of CPP and institutions that participated in the program. For example, we  tested the Office of Financial Stability’s internal controls over financial  reporting as they relate to our annual audit of the office’s financial  statements and found the information to be sufficiently reliable based on  the results of our audits of fiscal years 2009, 2010, 2011, and 2012  financial statements for TARP. We have assessed the reliability of SNL  Financial data—which are obtained from financial statements submitted  to the banking regulators—as part of previous studies and found the data  to be reliable for the purposes of our review. We verified that no changes  had been made that would affect the data’s reliability.
We conducted this performance audit from December 2013 to April 2014  in accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
section_title: Appendix II: Comments from the Office of Financial Stability
section_title: Appendix III: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Karen Tremba (Assistant  Director), Emily Chalmers, William Chatlos, Chris Forys, Matthew Keeler,  Risto Laboski, Marc Molino, and Patricia Moye made significant  contributions to this report.