16 Hoosier Banker July 2016 above statement reported the examiner-in-charge had been supervising bank examinations for less than five years. Augmenting the experience of examiners is only one part of the solution, however. Some financial institution letters, such as FIL-44-2008, contain language stating the guidance “should not be considered as a set of required procedures.” However, others contain language that is more ambiguous. For example FIL-82-2010 states that “the Guidelines enhance the requirements for collateral valuation methods.” The mention of requirements is understandably confusing. Changes in staffing must be combined with a clearer communication of expectations from the agencies to banks. Continue ‒ The most polarized results from the current RFI survey data surround exam preparation. Overall, institutions had positive feedback pertaining to the examination staff being “knowledgeable about important issues and regulatory requirements” and “knowledgeable about your institution.” This indicates an adequate level of preparation by staff prior to examinations. However, a significant number of comments pertain to banks being given short notice to prepare themselves for the examinations. Examiners should continue to be vigilant in preparing for examinations, but should be equally proactive in communicating information about schedules and timing as early as possible. In combination with providing examiners feedback, the improved RFI survey and greater bank participation allow for better reports to aid bankers in upcoming examinations. Past survey comments indicate the desire to know such basics as: • “That BSA and IT were growing hot topics” Continued from page 14. • “There is a new focus on detailed policies” • “The examiner was going to spend 75 percent of their time on interest rate risk” • “Application of UDAAP specifically to their bank” • Or generally “when the goal posts moved.” We hear you, and the reports from the new survey will greatly improve your bank’s ability to stay aware of hot topics in preparation for examinations. While it is always incumbent on senior managers and directors to stay educated on current industry issues and regulations, the chart below shows the areas of greatest criticism in examinations conducted over the last two years. Bank participation is paramount to the success of the RFI. We encourage all institutions to visit allbankers.org to share anonymous information about their most recent examinations. t Fifteen member institutions of the Indiana Bankers Association were honored in May as “Top 200 Community Banks” in the country by American Banker magazine. More than 680 institutions nationwide qualified for consideration, from which 200 banks were chosen and ranked by return on equity over the course of the last three years. IBA-member institutions included in the listing were ranked as follows: No. 3 – United Bank, Evansville 7 – First Farmers Bank and Trust Company, Converse 45 – The Farmers Bank, Frankfort 56 – Farmers State Bank, LaGrange 72 – Community First Bank of Indiana, Kokomo 73 – River Valley Financial Bank, Madison 91 – First State Bank of Middlebury 93 – First Federal Savings Bank, Huntington 98 – Crossroads Bank, Wabash 117 – Peoples Bank, Munster 142 – First Harrison Bank, Corydon 165 – The National Bank of Indianapolis 177 – Logansport Savings Bank 180 – First Robinson Savings Bank, Robinson, Illinois 185 – Your Community Bank, New Albany Two individuals of IBA-member institutions were elected board officers of United Way of Central Indiana. Connie Bond Stuart, regional president of central and southern Indiana, PNC Bank, NA, Indianapolis, has been elected chairman of the board. Deborah Daniels, managing partner, Krieg DeVault LLP, Indianapolis, has been elected secretary of the board. t HonorablE MEnTions Safety and Soundess Examination Compliance Examination Exam Area Percent of Institutions Receiving Criticism Exam Area Interest rate risk management approaches 24% Real Estate Settlement Procedures Act 24% Credit administration practices 23% Regulation Z (Truth in Lending Act) 23% Adversely classified asset levels 21% Re HMDA/Regulation C 23% Real estate appraisal and evaluation processes 20% Flood Disaster Protection Act 18% Business Continually Planning 17% Regulation B (Equal Credit Opportunity Act) 16% Percent of Institutions Receiving Criticism
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