FinPro’s staff of former senior regulators provide extensive expertise and are uniquely positioned to recognize deficiencies at an institution. FinPro maintains close contact with all bank regulatory agencies and departments in order to stay current with upcoming policies and rules.
REVIEW, ASSESS, MITIGATE, PERFORM, UNDERSTAND, PRESENT
FinPro can provide a bank with assistance to prepare for an examination or will assist with resolution of a regulatory enforcement action. This process includes:
- Review data - A quantitative and qualitative review of bank files and information will be conducted. FinPro can also assist with negotiation of the order to ensure proper terms, timelines, and requirements.
- Assess risk - Using the information gathered in the review stage, conduct an assessment of each of the elements of the CAMELS rating system, plus additional vulnerable areas, to identify potential risks and the severity of risks.
- Mitigate risk - Upon assessing its risk profile, proactively make changes to deficient areas and develop plans to mitigate risks going forward.
- Perform to plan - In order to effectively manage the risk profile of the institution, the Board needs to monitor its performance on a periodic basis.
- Understand implications - After the review process, each Board member should know the answers to important questions and understand the implications of the institution’s position.
- Present actions - The actions taken by the institution need to be communicated across the entire spectrum of the organization. FinPro will help the Board and management effectively tailor the message of the organization to both internal and external audiences.
WHY BANKS NEED TO PREPARE FOR REGULATORY EXAMS
- Examinations are leading to more enforcement actions.
- Major criticisms in recent regulatory enforcement actions lead to required corrective actions that could have a severe impact on an institution.
- Advanced preparation saves time and money.
- A CAMELS rating downgrade by the regulators can result in as much as an additional $100,000 per year in FDIC insurance premiums for every $100 million in deposits.
- In addition to FDIC assessment hikes, institutions can expect increases in other noninterest expense items such as legal, consulting, D&O and fidelity insurance.
- A prolonged period of regulatory oversight will limit business opportunities and value creation.