The views expressed are my own and do not necessarily reflect the views of the Federal Reserve Bank of Atlanta or the Federal Reserve System.

Transcription

1 The views expressed are my own and do not necessarily reflect the views of the Federal Reserve Bank of Atlanta or the Federal Reserve System.

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4 Twelve districts, based on input from bankers, businesses, and the public in 1914

5 Federal Reserve System: STRUCTURE Board of Governors Federal Open Market Committee (FOMC) Functions: Monetary policy Banking supervision Financial services 12 Reserve Banks and Board of Directors

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12 Open Market Operations FOMC: Buying and selling of treasury securities in the open market Fed Funds Market (overnight borrowing among banks) FOMC votes Fed Funds Rate Inject $ Withdraw $

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16 Georgia Banking School: Economic and Monetary Policy Discussion May 8, 2017 The views expressed are mine, and not necessarily those of the Atlanta Fed or the Federal Reserve System.

17 Atlanta District and Branch Locations 2 Nashville Birmingham ATLANTA Jacksonville New Orleans Miami

18 At the Atlanta Fed, we use data, forecasts, and information from Main Street to develop our policy recommendations. The Atlanta Fed Process FOMC Meeting Debriefing with economists and Regional Executives. Discuss issues/questions in preparation for upcoming meeting(s)

19 The discussions are ongoing, with new information being added on a daily basis. The Atlanta Fed Process FOMC Meeting Debriefing with economists and Regional Executives. Discuss issues/questions in preparation for upcoming meeting(s) Economists prepare briefings for the President REs conduct field interviews with District contacts and Board of Directors

20 Forecasts are developed and weighed against what we hear from business and community contacts. The Atlanta Fed Process FOMC Meeting Debriefing with economists and Regional Executives. Discuss issues/questions in preparation for upcoming meeting(s) Economists prepare briefings for the President REs conduct field interviews with District contacts and Board of Directors Formal forecast meeting with President REs share anecdotal feedback with President (and forecast economists)

21 Our initial forecasts are shared with our Boards of Directors and altered based on their input. The Atlanta Fed Process FOMC Meeting Debriefing with economists and Regional Executives. Discuss issues/questions in preparation for upcoming meeting(s) Economists prepare briefings for the President REs conduct field interviews with District contacts and Board of Directors Formal forecast meeting with President REs share anecdotal feedback with President (and forecast economists) Director meetings/reports used to test out forecast

22 The final step is the development of our president s statement about the economy and monetary policy views. The Atlanta Fed Process FOMC Meeting Debriefing with economists and Regional Executives. Discuss issues/questions in preparation for upcoming meeting(s) Economists prepare briefings for the President REs conduct field interviews with District contacts and Board of Directors Formal forecast meeting with President Director meetings/reports used to test out forecast REs share anecdotal feedback with President (and forecast economists) President s statement for FOMC prepared by REs and Research Officers

23 SUPERVISION AND REGULATION G e o r g i a B a n k i n g S c h o o l P r e s e n t e d b y : D a v i d B r y a n S t a f f D i r e c t o r S u p e r v i s i o n & R e g u l a t i o n F e d e r a l R e s e r v e B a n k o f A t l a n t a T h e v i e w s e x p r e s s e d h e r e a r e m y o w n a n d d o n o t n e c e s s a r i l y r e f l e c t t h e v i e w s o f t h e F e d e r a l R e s e r v e B a n k o f A t l a n t a o r t h e F e d e r a l R e s e r v e S y s t e m

24 OBJECTIVES Purpose of Supervision and Regulation What Agencies Are Involved Types of Institutions Examined What Areas are Examined

25 PURPOSE Ensure the Safety and Soundness of the Financial System, Financial Institutions, and protect the FDIC Insurance Fund Ensure that Banks and Bank (Thrift) Holding companies comply with all Laws and Regulations including Consumer Compliance Laws and Regulations

26 AGENCIES INVOLVED Federal Reserve System (FRS) Federal Deposit Insurance Corporation(FDIC) Office of the Comptroller of the Currency(OCC) Consumer Financial Protection Bureau(CFPB) National Credit Union Administration (NCUA) State Banking Departments

27 INSTITUTIONS EXAMINED Banks National Banks OCC State Member Banks FRS, State Banking Regulators State Non-member Banks FDIC, State Banking Regulators Thrifts OCC (States) Bank Holding Companies FRS (States) Thrift Holding Companies FRS (States) Credit Unions NCUA (States) Foreign Banking Branches and Agencies - FRS

28 AREAS EXAMINED Financial condition of the institution (Safety and Soundness) Consumer Compliance Information Technology Bank Secrecy Act/Anti-Money Laundering Trust Activities

29 BANKS - CAMELS CAPITAL ADEQUACY ASSET QUALITY MANAGEMENT EARNINGS LIQUIDITY SENSITIVITY TO MARKET RISK COMPOSITE RISK MANAGEMENT

30 RATINGS 1 STRONG 2 SATISFACTORY 3 FAIR 4 MARGINAL 5 - UNSATISFACTORY

31 CAPITAL ACTUAL LEVEL OF CAPITAL CAPITAL LEVELS IN REGARD TO OVERALL RISK PROFILE CAPITAL PLANNING PROMPT CORRECTIVE ACTION

32 ASSET QUALITY LEVEL OF PROBLEM ASSETS CONCENTRATIONS IN LOAN PORTFOLIO CREDIT ADMINISTRATION ALLOWANCE FOR LOAN AND LEASE LOSSES

33 MANAGEMENT QUALITY OF MANAGEMENT TEAM STRATEGIC PLANNING COMPLIANCE WITH LAWS AND REGULATIONS SUCCESSION PLANNING

34 EARNINGS QUANTITY OF EARNINGS QUALITY OF EARNINGS BUDGETING ACCURACY OVERALL NEEDS OF INSTITUTION

35 LIQUIDITY LIQUIDITY SOURCES Asset liquidity Liability liquidity OFF-BALANCE-SHEET COMMITMENTS CASH FLOW Loan payments Liability withdrawals

36 SENSITIVITY TO MARKET RISK QUANTITY OF RISK Net Interest Income Economic Value of Equity QUALITY OF RISK MANAGEMENT Size and Scope of operation Does bank management understand the risks facing the bank

37 COMPOSITE RATING NOT A NUMERIC AVERAGE USUALLY DRIVEN BY ASSET QUALITY (BUT NOT NECESSARILY) REPRESENTS THE OVERALL CONDITION OF THE BANK

38 RISK MANAGEMENT OVERALL RISK MANAGEMENT OF INSTITUTION FEDERAL RESERVE LOOKS AT SIX RISKS Credit Risk Liquidity Risk Market Risk Operational Risk Legal Risk Reputational Risk

39 CREDIT RISK OVERAL CREDIT ADMINISTRATION EFFECTIVENESS OF LOAN REVIEW CONCENTRATIONS OF CREDIT ALLL METHODOLOGY

40 LIQUIDITY RISK CONTINGENCY FUNDING PLANS UNDERSTANDING OF LIQUIDITY POSITION EFFECTIVE MANAGEMENT OF LIQUIDITY POSITION

41 MARKET RISK APPETITE FOR MARKET RISK SKILL AT MANAGING MARKET RISK DECISIONS THAT LIMIT MARKET RISK

42 OPERATIONAL RISK INFORMATION TECHNOLOGY CYBERSECURITY INTERNAL AUDIT INTERNAL CONTROLS BSA/AML

43 LEGAL RISK COMPLIANCE WITH LAWS AND REGULATIONS POTENTIAL LAWSUITS ARISING FROM OPERATIONAL OR LENDING PRACTICES

44 REPUTATIONAL RISK USUALLY ARISES FROM OPERATIONAL RISK OR CREDIT RISK USUALLY RELATED TO LEGAL RISK POTENTIAL DEPOSIT WITHDRAWALS OR REDUCTIONS IN GROWTH

45 BANK (THRIFT) HOLDING COMPANIES RFIC Risk management Financial Condition Impact on Organization and Bank Subsidiaries Composite

46 RECAP WE COVERED Purpose of Supervision and Regulation What agencies are involved Types of institutions examined What areas are examined

47 QUESTIONS?