A $2.4 billion 2023 operating budget that will be 6.5% higher than the previous year’s spending plan was approved Tuesday by the board of the federal bank deposit insurance agency.
Also at its meeting Tuesday, the Federal Deposit Insurance Corp. (FDIC) Board issued guidelines for appeals of material supervisory determinations, following up on a request for comment the board released in October.
Regarding the operating budget, the agency indicated that the increase would largely fund efforts to compensate its workforce and recruit new workers. The FDIC said the budget “authorizes 220 new positions primarily to carry out the FDIC’s bank supervision and other core mission responsibilities.”
In addition, the agency noted, it has reached agreement in principle with the agency’s employee union on a new three-year compensation agreement that raises compensation to “reflect the impact that higher inflation has had on current salaries.” The agreement will also, the agency asserted, help to maintain comparability of compensation for FDIC employees relative to other federal banking agencies, as required under the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA).
“A number of factors are particularly impacting the need for additional safety and soundness and consumer compliance examiners, including the increasing size and complexity of the institutions the FDIC supervises, the downside risks to the banking system in the current uncertain economic environment, the large number of retirement-eligible examiners, and the time needed to develop new commissioned examiners,” the agency said in its release.
Additionally, the FDIC said the budget “continues the investments the FDIC has been making for a number of years to modernize and enhance the FDIC’s information technology infrastructure and protect the sensitive data that the FDIC maintains.”
In other action, the board released guidance intended to expand and clarify the role of the agency’s ombudsman in the appeals process, including adding the ombudsman to the agency’s Supervision Appeals Review Committee (SARC) as a non-voting member.
Highlights of the guidelines, the agency said, included:
- Materials considered by the SARC will be shared with both parties to the appeal on a timely basis, and in time to prepare for a meeting with the SARC, if one is requested, subject to applicable legal limitations on disclosure and oversight by the ombudsman.
- Institutions may request a stay of a supervisory action or determination from the appropriate division director while an appeal is pending. The division director will have discretion to grant a stay and may grant a stay subject to certain conditions, where appropriate. Decisions will be provided to institutions, in writing, regarding a stay that includes the reasons for the decision.
- The ombudsman will monitor the supervision process following an institution’s submission of an appeal under the revised guidelines and report to the board on these matters periodically.
FDIC Board Approves 2023 Operating Budget
Guidelines for Appeals of Material Supervisory Determinations