Bank Regulatory News
June 26, 1998 -
CUSTOMER BROCHURE ON YEAR 2000 DATE CHANGE - FDIC Consumer Information Brochure on the
Year 2000 Date Change
The Federal Financial Institutions Examination Council's (FFIEC) recent guidance on Year
customer awareness programs indicated the FFIEC was developing a customer brochure
highlighting the efforts of financial institutions and the FFIEC to address the Year 2000
problem. The brochure, The Year 2000 Date Change, is now available to the public and
is being issued by the Federal Deposit Insurance Corporation (FDIC).
1998 - FDIC MAKES PUBLIC MAY 1998 ENFORCEMENT ACTIONS;
NO ADMINISTRATIVE HEARINGS SCHEDULED FOR JULY
The FDIC processed a total of 17 orders in May. These included 11
call report penalties, one
removal and prohibition order, one voluntary termination of deposit insurance, three
of cease-and-desist orders and one adjudicated decision.
19, 1998 -DEPOSIT INSURANCE ASSESSMENT RATES - Deposit Insurance Assessment Rate
Schedules and Financing Corporation Assessment Rates
Deposit insurance assessment rates for the Bank Insurance Fund (BIF) and the Savings
Association Insurance Fund (SAIF) in effect for the June 30, 1998, quarterly payment, and
Financing Corporation (FICO) assessment rates for the same quarterly payment are discussed
below. Information is also provided on how insured institutions may obtain the prevailing
and FICO assessment rates in the future.
1998 - FDIC ANNOUNCES NEW "SUSPICIOUS INTERNET BANKING" WEB SITE - The
Federal Deposit Insurance Corporation (FDIC) has launched a "Suspicious Internet
Banking" Web site to help detect potentially fraudulent Internet banking activity.
The new Web
site provides the public and the industry with a "user-friendly" vehicle for
operating on the Internet that may be misrepresenting themselves as legitimately chartered
federally insured depository institutions.
June 17, 1998 -
Acting Comptroller Cites Slippage in Internal Controls; OCC to "Drill Down" to
Test Adequacy of Bank Systems
CHICAGO -- Acting Comptroller of the Currency Julie L. Williams expressed concern today
that the "vigor and thoroughness" of bank internal controls are declining at a
time of challenge in many areas of the business.
June 12, 1998 -
Acting Comptroller Announces Consumer Privacy Initiatives
WASHINGTON, D.C. -- Acting Comptroller of the Currency Julie L. Williams announced today
she has directed the OCC's Privacy Working Group to develop guidance for national banks
addressing a number of consumer privacy issues, including web site disclosures of bank
privacy policies, sharing of customer information, customer information security and the
problem of identify theft.
June 11, 1998 -
The Federal Reserve Board today requested public comment on an interpretation and two
proposed rules exempting certain transactions between an insured depository institution
and its affiliates under section 23A of the Federal Reserve Act. Comment is
requested by July 21, 1998.
June 11, 1998 - Texas
Finance Commission Begins State-Wide Study of Consumer Depository And Cash Services
Texas Finance Commission Chairman W. D. Hilton, Jr. announced today that the Finance
Commission is commencing a study of consumer depository and cash services throughout the
of Texas. This study is part of a broader mandate in the Texas Finance Code requiring the
Commission to conduct research on: (1) the availability, quality, and prices of financial
including lending and depository services, offered to individual consumers, agricultural
and small businesses and (2) the practice of business entities in this state that provide
services to individual consumers, agricultural businesses and small businesses. Because of
the broad scope of the mandate, this research is being conducted in phases, and the first
phase will focus specifically on consumer depository and cash services provided to
individuals throughout the State of Texas.
June 11, 1998 -
SPECIAL ALERT - Letter of Guarantee Instruments
The Office of the Comptroller of the Currency has advised us that it has received
regarding Letter of Guarantee instruments aggregating $130 million (U.S.) issued by the
Government of Grenada, W. I. The authenticity of the instruments is questionable. Prior to
accepting any such instruments, the instruments should be verified with the Government of
Grenada to ensure that they are originals. A copy of one such instrument is attached.
June 11, 1998 - FDIC REPORT
FOR FIRST QUARTER SHOWS FIFTH STRAIGHT EARNINGS RECORD FOR COMMERCIAL BANKS, NEAR-RECORD
Insured commercial banks reported record profits in the first quarter of 1998, marking the
consecutive quarter that earnings set a new high, according to preliminary data released
the FDIC. First-quarter 1998 net income totaled $15.9 billion, which is $621 million
the previous record set in the fourth quarter of 1997.
June 10, 1998 - DEBT
COLLECTION IMPROVEMENT ACT OF 1996 - Consumer Disclosures by Financial Institutions Having
Arrangements With Nondepository Providers of Payment Services
The attached letter from Treasury Under Secretary John D. Hawke, Jr. addresses certain
concerns about implementing provisions of the Debt Collection Improvement Act of 1996,
called EFT99. The Act requires recipients of federal payments to designate a
institution or other authorized agent to receive the payments by electronic funds transfer
The U.S. Department of the Treasury has a rulemaking proceeding in progress to implement
June 10, 1998 - FDIC
ANALYSTS HIGHLIGHT EFFECTS OF ASIAN CRISIS IN U.S., WEIGH RESULTS OF REVISED ACCOUNTING
A recent evaluation of economic conditions across the United States by Federal Deposit
Insurance Corporation analysts found that the impact of reduced Asian demand for U.S.
products and competition from cheaper Asian imports will vary considerably across the
with some industries experiencing significant effects.
June 5, 1998
- The Federal Reserve Board today requested comment on whether the last fifteen minutes of
the Fedwire funds transfer operating day (from 6:15 p.m. to 6:30 p.m. Eastern Time)
should be restricted to funds transfers sent and received by depository institutions for
their own account. This would facilitate the end-of-day management of their balances held
at the Federal Reserve. Comment is requested by August 12, 1998.
June 4, 1998 -
FOREIGN ASSETS CONTROL ACT - Prohibition of Certain Transactions with Sudan; Blocking of
Accounts Associated with Narcotics Traffickers
On May 13, 1998, the Department of the Treasury's Office of Foreign Assets Control (OFAC)
amended its list of prohibited entities associated with Sudan. On May 26, 1998, OFAC added
six individuals and 21 companies to its list of Specially Designated Narcotics Traffickers
(SDNTs). The updated listing is attached.
June 4, 1998 -
INTEREST CHARGES - General Counsel Opinions on Interest Charges
The Federal Deposit Insurance Corporation (FDIC) General Counsel has recently issued two
opinions concerning interest charges by insured institutions. Both opinions, No. 10 and
have been published in the attached Federal Register notices.
June 3, 1998 -
DEPOSIT INSURANCE COVERAGE - Bank and Thrift Employees' Knowledge of Federal Deposit
Federal regulators have become increasingly aware that some bank and thrift employees are
providing incorrect information about deposit insurance coverage. The Federal Deposit
Insurance Corporation (FDIC) encourages all institutions to ensure that their employees,
especially those with front-line contact with depositors, thoroughly understand the basic
provisions of federal deposit insurance.
June 1, 1998 - FDIC
ANNOUNCES RESULTS OF YEAR 2000 ON-SITE REVIEWS
The Federal Deposit Insurance Corporation (FDIC) today announced that examiners had
completed at least one on-site review at each of the 6,034 institutions it regulates to
institutions efforts on addressing Year 2000 problems. The efforts of each
assessed to be satisfactory, needs improvement, or
unsatisfactory as of the date it was
examined. The FDIC found that 5,296 of the 6,034 institutions it supervises -- or about 88
percent -- were making satisfactory progress. Another 695 institutions -- or about 12
needed improvement in their efforts. The efforts of 43 institutions -- less than one
percent of all
FDIC-regulated institutions -- were found to be unsatisfactory.
June 1, 1998 - YEAR
2000 READINESS ASSESSMENTS
Year 2000 Readiness Assessment Strategy for FDIC-Supervised Financial Institutions
The Federal Deposit Insurance Corporation (FDIC), along with the other member agencies of
the Federal Financial Institutions Examination Council (FFIEC), committed last year to
conducting an on-site assessment of Year 2000 readiness of all insured financial
June 30, 1998. To date, examiners have completed an on-site assessment at all of the 6,034
financial institutions for which the FDIC serves as primary federal regulator. The efforts
institution were assessed to be "Satisfactory," "Needs Improvement,"
or "Unsatisfactory" as of
the date it was examined.
June 1, 1998 - The State Liaison Committee of
the Federal Financial Institutions Examination Council has elected Thomas J. Curry as its
Chairman. Mr. Curry is the Massachusetts Commissioner of Banks with supervisory
responsibility over state-chartered trust companies, savings banks, cooperative banks,
credit unions, and credit licensees. The Department regulates and licenses over 2,300
businesses and financial institutions with total assets in excess of $100 billion.
June 1, 1998
- The Federal Reserve Board has issued a final rule amending the Tier 1 leverage capital
standard for bank holding companies. The rule is effective June 30, 1998.
The amendment to Regulation Y establishes a minimum ratio of Tier 1 capital to total
assets (leverage ratio) of 3.0 percent for bank holding companies that either are rated
composite "1" under the BOPEC rating system or have implemented the Board's
risk-based capital market risk measure. The minimum leverage ratio for all other bank
holding companies is 4.0 percent. Bank holding companies are expected to maintain
higher-than-minimum capital ratios if they have supervisory, financial, operational, or
managerial weaknesses, or if they are anticipating or experiencing significant growth.
Listing of Bank and Bank Holding Company Application Bulletins
Federal Reserve Board Public
Information Actions, Orders, and Other Documents, all FRB districts
Operating Circulars, maintained by the FRB of Chicago
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