What We Do

Regional and Community Bank Group (RCBG)
The Regional and Community Bank Group (RCBG) is made up of two principal areas, Financial Examinations/Supervision and Consumer Affairs/Supervision.

Financial Examinations has responsibility for examining regional and community banks and Bank Holding Companies (BHCs), as well as the U.S. offices of Financial Banking Organizations (FBOs). Unit staff also conduct ongoing supervision of institutions, providing follow-up on issues identified during examinations and maintaining regular contact with bank management on a variety of supervisory matters.

Financial Examinations employs a risk-focused supervision framework that tailors each examination to the institution’s risk profile. On-site examinations determine the safety and soundness of the institution’s operations and financial condition, as well as the integrity of trust operations and information systems. Examiners evaluate the quality of the institution’s assets, the effectiveness of internal controls, policies and risk management systems, and compliance with banking laws and regulations.

The supervision of BHCs focuses on whether the parent company can act as a source of strength to its subsidiary bank(s) and on the potential risks presented by nonbank units to banking affiliates. These nonbank units are typically engaged in mortgage banking, commercial and consumer finance, activities related to futures commission merchants, securities and discount brokerages, and credit related insurance underwriting. The supervision framework for Financial Holding Companies (FHCs) relies on existing work of functional regulators (such as the Securities and Exchange Commission and various state insurance agencies), where appropriate. Key elements of the Federal Reserve’s FHC supervision framework include evaluating enterprise-wide risk and capital adequacy.

Consumer Affairs staff examine state member banks to enforce compliance with numerous consumer banking laws and regulations. Among such laws are the Truth in Lending Act, the Community Reinvestment Act (CRA) and Equal Credit Opportunity Act. Like financial examinations, compliance examinations focus on the areas that pose the greatest risk to the institution and its consumers. Staff also provide ongoing monitoring and technical assistance to individual banks, as well as group training forums. In addition, the unit investigates various consumer complaints, such as disputes about a denial of credit.

International and Large Bank Group (ILBG)
The International and Large Bank Group (ILBG) oversees some of the District’s largest and most complex domestic and international organizations.

The Large Bank unit conducts a program of continuous supervision for large and complex domestic institutions, combining full-scope and target on-site examinations with a variety of off-site monitoring activities. Unit staff coordinate regularly with the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation and state banking agencies. Staff also actively coordinate with non-banking regulators such as the Securities and Exchange Commission and state insurance agencies.

International Institutions is responsible for the supervision of several of the largest Japanese and European banks that have operations in the United States. The unit also supervises a diverse group of primarily Asian institutions from Hong Kong, India, Korea, Malaysia, Philippines, and Taiwan.

International Supervision monitors and analyzes financial sector developments in key Asian and European countries, providing Board-mandated country studies and analyses, conducting foreign banking organization surveillance and coordinating technical assistance programs with foreign supervisory agencies.

Risk Monitoring and Analysis Group (RMAG)
Risk Monitoring and Analysis Group (RMAG) comprises three principal areas: Banking Applications and Enforcement, Risk Coordination, Surveillance and Analysis.

Banking Applications and Enforcement processes all applications from BHCs, FHCs, state member banks and international banking entities. Examples of reviewed applications include mergers and acquisitions, Federal Reserve membership, BHC formation and new activities not previously judged permissible by the Federal Reserve Board. In evaluating domestic applications, staff considers financial and managerial factors, legality and the effects on competition. In addition, the Federal Reserve must approve all new branches, agencies, and representative offices of foreign banks doing business in the United States. While upholding statutory standards and requirements, staff also provide guidance to applicants and strive to provide prompt responses and actions on application matters.

Risk Coordination identifies, explores, and provides guidance on a wide range of banking and policy issues, trends, and risks. The team focuses on broad industry conditions as well as specific sectors (such as commercial real estate), capital markets, risk modeling and development, and implementation of regulatory policies, including those related to capital adequacy and accounting practices. A key responsibility of this area is coordinating the activities related to the Division’s Risk Assessment Council, which identifies banking risks and determines appropriate supervisory responses. RMAG staff regularly participate in examinations and other supervisory activities at some of our large and complex BHCs. In addition, staff are heavily involved in System efforts to advance the use of market information (such as bank equity and dept prices) in supervision and to enhance public disclosure and market discipline in the banking industry.

Surveillance and Analysis conducts quarterly domestic bank and bank holding company financial surveillance and monitoring and provides pre-examination analysis and other ad hoc analytical support to Financial Examinations staff and Division management. This area also provides regular financial analysis of some of our largest and most complex supervised institutions and is responsible for the overall supervision of the District’s small, non-complex BHCs.

Community Development
Community Development works with financial institutions to facilitate compliance with the Community Reinvestment Act. The Act calls for lenders to meet the credit needs in all areas of their defined communities, including low and moderate income areas and people. Community Development staff host educational forums, provide training, create educational publications, and work with community-based organizations to promote the use of loan pools, public/private partnerships, and other opportunities for banks to help meet community credit needs.