[Federal Register Volume 60, Number 31 (Wednesday, February 15, 1995)]
[Proposed Rules]
[Pages 8583-8591]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-3176]
-----------------------------------------------------------------------
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Part 363
RIN 3064--AA83
Annual Independent Audits and Reporting Requirements
AGENCY: Federal Deposit Insurance Corporation (FDIC or Corporation).
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: Section 314 of the Riegle Community Development and Regulatory
Improvement Act of 1994 (RCDRIA) amends sections 36(i) and 36(g)(2) of
the Federal Deposit Insurance Act (FDI Act). Section 36 of the FDI Act
is generally intended to facilitate early identification of problems in
financial management through annual independent audits, assessments of
the effectiveness of internal controls and of compliance with
designated laws and regulations, and more stringent reporting
requirements. Section 314(a) provides relief from certain duplicative
reporting under section 36 of the FDI Act for sound, well managed
insured depository institutions with over $9 billion in total assets
which are subsidiaries of multibank holding companies. Section 314(b)
requires the Corporation to notify a large insured depository
institution in writing if it decides a review by an independent public
accountant of such institution's quarterly financial reports is
required. [[Page 8584]] The Corporation's regulations governing annual
independent audits implement section 36 of the FDI Act and this
proposed amendment seeks to conform the regulations to the amended
statute.
In addition, the FDIC proposes several minor, technical amendments
to the guidelines and interpretations (Guidelines), published as an
appendix concerning compliance with certain provisions of section 36.
The FDIC also proposes to amend the schedule entitled, ``Agreed Upon
Procedures for Determining Compliance with Designated Laws'', to
implement recent amendments to the federal regulations concerning loans
to insiders improve the format of the procedures, streamline the
specific procedures, and eliminate ambiguities. These proposed
amendments reflect the experience of the Corporation, institutions, and
accountants with the existing procedures during the past year.
DATES: Comments must be received by April 17, 1995.
ADDRESSES: Send comments to Robert E. Feldman, Acting Executive
Secretary, FDIC, 550 17th Street, N.W., Washington, D.C. 20429.
Comments may be hand-delivered to room 400, 1776 F Street, N.W.,
Washington, D.C. 20429 on business days between 8:30 a.m. and 5:00 p.m.
(FAX number: (202) 898-3838.) Comments will be available for inspection
in room 7118, 550 17th Street, N.W., Washington, D.C., between 9 a.m.
and 4:30 p.m. on business days.
FOR FURTHER INFORMATION CONTACT: Doris L. Marsh, Examination
Specialist, Division of Supervision, (202) 898-8905, or Sandra
Comenetz, Counsel, Legal Division, (202) 898-3582, FDIC, 550 17th
Street N.W., Washington, D.C. 20429.
SUPPLEMENTARY INFORMATION:
I. Background
Section 112 of the Federal Deposit Insurance Corporation
Improvement Act of 1991 (FDICIA) added section 36, ``Independent Annual
Audits of Insured Depository Institutions'', to the FDI Act (12 U.S.C.
1831m). Section 36 requires the FDIC, in consultation with the
appropriate federal banking agencies, to promulgate regulations
requiring each insured depository institution over a certain asset size
(covered institution) to have an annual independent audit of its
financial statements performed in accordance with generally accepted
auditing standards and section 37 of the FDI Act (12 U.S.C. 1831n), and
to provide a management report and independent public accountant's
attestation concerning both the effectiveness of the institution's
internal controls for financial reporting and its compliance with
designated safety and soundness laws. Section 36 also requires each
covered institution to have an independent audit committee. The audit
committee of each large covered institution (total assets exceeding $3
billion) must meet additional requirements.
Section 36 also requires the FDIC, in consultation with the other
federal banking agencies, to designate laws and regulations concerning
safety and soundness. This section requires the institution's
independent public accountant to perform procedures agreed upon by the
Corporation to determine an institution's compliance with these
designated laws and regulations. The ``Designated Laws'' selected by
the Corporation are the federal laws and regulations concerning loans
to insiders and the federal and state laws and regulations concerning
dividend restrictions.
In June 1993, the FDIC published 12 CFR part 363 (58 FR 31332, June
2, 1993) to implement the provisions of section 36 of the FDI Act.
Under part 363, the requirements of section 36 apply to each insured
depository institution with $500 million or more in total assets at the
beginning of any fiscal year that begins after December 31, 1992.
Section 314 of RCDRIA amends sections 36(i) and 36(g)(2) of the FDI
Act (12 U.S.C. 1831m (i) and (g)(2)). The purpose of section 314(a) is
to provide relief from certain duplicative reporting under section 36
of the FDI Act for sound, well managed insured depository institutions
with over $9 billion in total assets which are subsidiaries of
multibank holding companies. Section 314(b) requires the Corporation to
notify a large insured depository institution in writing if it decides
to require a review by an independent public accountant of such
institution's quarterly financial reports. In addition, the federal
regulations concerning loans to insiders (Federal Reserve Regulation O,
12 CFR part 215), which are included in one of the Designated Laws,
were amended during 1994.
The FDIC proposes certain amendments to 12 CFR Part 363, which
conform Part 363 to the amended statute. The FDIC also proposes several
minor, technical amendments to the guidelines and interpretations
(Guidelines), published as Appendix A to part 363, concerning
compliance with certain provisions of section 36.
In addition, a year's experience with Part 363 indicates that a
clarification of certain of the specific procedures in Schedule A to
Appendix A of the Guidelines would make them more efficient and less
burdensome. The FDIC therefore proposes to amend Schedule A to Appendix
A--Agreed Upon Procedures for Determining Compliance with Designated
Laws, to reflect the recent amendments to the federal regulations
concerning loans to insiders (12 CFR Part 215), improve the format of
the procedures, streamline the specific procedures, and eliminate
ambiguities. The proposed amendments reflect the experience of the
Corporation, institutions, and accountants dealing with the existing
procedures during the past year.
Section 36(g)(2) of the FDI Act authorizes the FDIC to require
independent public accountants for ``large institutions'' to review
such institutions' quarterly financial reports. This provision is
amended by Section 314(b) of RCDRIA to add section 36(g)(3) which
requires the Corporation to notify a large insured depository
institution in writing if it decides to require a review of its
quarterly financial reports by an independent public accountant. When
the FDIC adopted Part 363, it elected not to exercise its authority in
this area for reasons of cost and limited expected benefits, preferring
instead to request such reviews on a case-by-case basis. The FDIC has
not changed its opinion. Should the FDIC decide to request an
independent public accountant's review of the quarterly financial
statements of a large insured depository institution, it will make the
request in writing.
II. The Proposal
The FDIC proposes to make conforming amendments to Part 363 so that
it is consistent with section 36 as amended by section 314 of RCDRIA,
and to make minor, technical, and clarifying changes to the Guidelines
in Appendix A. In addition, the FDIC proposes to amend and reformat the
specific procedures in Schedule A to Appendix A to make them more
efficient and less burdensome.
A. Amendments to the Rule
Section 363.1--Scope. In Sec. 363.1(b), the phrase ``but less than
$9 billion'' would be deleted from the provisions of the regulation
describing the institutions eligible to report using the holding
company exception set forth in section 36(i). This revision would make
the regulation consistent with the amendment to section 36(i) made by
section 314 of RCDRIA. In addition, the subsection would be reformatted
and another paragraph added to incorporate the provisions of section
314(a)(3) of RCDRIA which identifies the [[Page 8585]] circumstances
under which the appropriate federal banking agency may require a large
institution subsidiary of a holding company to have its own audit
committee and report separately.
Section 363.4--Filing and notice requirements. The citation in
Sec. 363.4(b) would be corrected so that it is clear that only the
annual report in Sec. 363.4(a)(1) is available for public inspection.
This correction would make the Rule consistent with section 36 of the
FDI Act.
Section 363.5--Audit committees. A new sentence would be added at
the end of Sec. 363.5(b) to make the rule consistent with the amendment
to section 36(i) made by section 314 of RCDRIA. The new sentence
prohibits any large customers of a large insured depository institution
from being members of the audit committee of the institution's holding
company if the institution relies on the audit committee of the holding
company to comply with this rule.
B. Amendments to Appendix A to Part 363--Guidelines and Interpretations
Guideline 4. Comparable Services and Functions--An amendment to
Guideline 4(c) under ``Scope of Rule'' would replace the word ``all''
with the word ``those'' to clarify that only information pertaining to
covered institutions must be included in reports filed under Part 363.
Guideline 9. Safeguarding of Assets. The third and fourth sentences
of Guideline 9 and the addition of a phrase to the footnote would be
revised. When Part 363 was adopted, the FDIC determined that
``safeguarding of assets'', as the term relates to internal control
policies and procedures for financial reporting, should be addressed in
the management report and the independent public accountant's
attestation discussed in guideline 18. In May, 1994, the Committee of
Sponsoring Organizations (COSO) of the Treadway Commission issued an
Addendum to the ``Reporting to External Parties'' volume of COSO's
September 1992 Internal Control--Integrated Framework (COSO Report).
The Addendum expanded the discussion of the scope of a management
report on internal controls to address additional controls pertaining
to safeguarding of assets. It states that ``Such internal control can
be judged effective if the board of directors and management have
reasonable assurance that unauthorized acquisition, use or disposition
of the entity's assets that could have a material effect on the
financial statements is being prevented or detected on a timely
basis''. The FDIC, therefore, believes that the concern that existed at
the time of the adoption of Part 363 over the lack of criteria against
which the accountant may judge safeguarding of assets for financial
reporting no longer exists. Thus, the last two sentences and the
footnote to this Guideline would be revised.
Guideline 10. Standards for Internal Controls. The footnote to
Guideline 10 includes a list of sources of information on safeguarding
of assets and standards for internal controls for financial reporting
that may be considered for use by institutions. The Addendum to the
COSO Report now contains information regarding safeguarding of assets.
Therefore, a reference to this standard would be added to the list in
the footnote, and Guideline 10 revised appropriately.
In addition, the American Institute of Certified Public Accountants
(AICPA) issued Statement on Auditing Standards No. 55 (SAS 55),
``Consideration of the Internal Control Structure in a Financial
Statement Audit''. SAS 55 has superseded AICPA Statement on Auditing
Standards No. 30 (SAS 30), ``Reporting on Internal Accounting
Control'', which is currently listed as a standard in the footnote to
Guideline 10. Therefore, SAS 30 would be deleted from the footnote and
replaced with SAS 55.
Guideline 15. Peer Reviews--The footnote to Guideline 15 includes
the names of the three peer and quality review programs of the AICPA.
Since the AICPA is combining two of these programs into a single peer
review program, the footnote to Guideline 15 would be amended to
identify the two acceptable peer review programs to which an
independent public accountant performing audit and attestation work may
belong.
Guideline 24. Relief from Filing Deadlines--The phrase referring to
section 36 of the FDI Act in the second sentence of Guideline 24 would
be deleted since section 36 does not provide authority to the FDIC to
provide relief to, or exempt institutions from, provisions in the
statute. This Guideline has also been revised to make it more readable.
Guideline 31. Holding Company Audit Committees--The first sentence
of Guideline 31 would be amended to clarify that a holding company
audit committee, on which subsidiary institutions rely in order to
comply with this rule, must meet the requirements for the audit
committee of the largest subsidiary institution.
The proposal would revise Guideline 31 because it has been widely
misunderstood. The first two sentences of this Guideline apply to the
situation where an insured depository institution subsidiary has $5
billion or more in total assets, and a 3, 4, or 5 composite CAMEL
rating. Such a subsidiary must have its own audit committee separate
from the audit committee of the holding company. It was not clear that
the third sentence of Guideline 31 addressed the situation where an
insured depository institution subsidiary has either less than $5
billion in total assets, or $5 billion or more in total assets and a 1
or 2 composite CAMEL rating, and its holding company performs services
and functions comparable to those required by the statute. In the
latter situation, an institution may choose to rely on the holding
company's audit committee. The members of the audit committee of the
holding company are expected to meet the membership requirements of the
largest subsidiary depository institution and may perform the duties of
the audit committee for a subsidiary institution without becoming
directors of the institution. This Guideline would be amended to
clarify its meaning.
Guideline 32. Duties--The second sentence of Guideline 32 would be
amended to complete the citation to certain sections of Part 363. The
sentence states that the duties of a covered institution's audit
committee should be appropriate to the size of the institution and the
complexity of its operations, and should include reviewing with
management and the independent public accountant the basis for the
reports issued under Secs. 363.2 (a) and (b) and 363.3 (a) and (b) of
the rule. At present, the citation refers only to Sec. 363.2(b) of the
rule.
C. Amendments to Schedule A to Appendix A--Agreed Upon Procedures for
Determining Compliance with Designated Laws
The agreed upon procedures in Schedule A would be amended to
clarify the numbering system, make the procedures consistent with
amendments to insider loan regulations, and adopt suggestions of
institutions and accountants to make the performance of the agreed upon
procedures more efficient and less burdensome.
Proposed formatting changes include renumbering the paragraphs and
adding more subject titles. The procedures applicable to insider
extensions of credit granted, insider extensions of credit outstanding,
aggregate insider extensions of credit outstanding, overdrafts,
limitations on extensions of credit to executive officers, and reports
on indebtedness to correspondent banks would all be placed in separate
[[Page 8586]] subsections of the procedures for more efficient
performance of the procedures and ease of reference. The amendments to
the Federal Reserve Board's Regulation O (12 CFR Part 215), the federal
rules governing insider loans, necessitated citation changes.
The proposed revisions to the procedures should make them less
burdensome for institutions and accountants since they will permit the
use of the most recently completed Reports of Condition and Income
(Call Report) or Thrift Financial Report (TFR) available when the
procedures are being performed rather than requiring the use of only
the year-end Call Report or TFR. The scope of the required reading of
board and committee minutes and reports under the Securities Exchange
Act of 1934 (15 U.S.C. 78a) would also be more clearly defined.
Inadvertent overdrafts in an aggregate amount of $1,000 or less, which
are exempt from Regulation O proscriptions (See 12 CFR 215.4(e)), would
no longer need to be separately tracked by institutions, listed when
certain representations are made by management, or tested by the
accountant. Where accountants were expected to compare insider
transactions to transactions with nonaffiliated persons, the comparison
period within which nonaffiliated transactions can take place would be
expanded from four to eight weeks. In addition, where no maximum number
transactions to which comparisons must be made were previously
included, comparisons would now be limited to a maximum of three. If no
comparable transactions exist, an alternative procedure would be
available to the institution.
To ensure that some tests were performed on each category of
extension of credit, including overdrafts and loans from correspondent
banks, accountants would be requested to obtain three separate samples.
In accordance with suggestions received for the procedures covering
extensions granted and outstanding during the year, the proposal would
have accountants focus the testing on a sample of insiders rather than
a sample of transactions.
Under the guidelines, an institution may choose to have some of the
testing required in the agreed-upon procedures performed by its
internal auditor with less testing performed by its independent public
accountant. When the holding company exception set forth in section
36(i) is used at a holding company with more than one covered
subsidiary institution, the proposal would extend to internal auditors
the same testing requirements that are now applicable to independent
public accountants. This would eliminate the existing requirement that
internal auditors perform the procedures on each covered subsidiary
every year. Thus, the testing of samples from all covered subsidiaries
every two or three years that has been required of independent public
accountants would now apply to internal auditors, and a requirement
that the lead institution or a few very large covered subsidiary
institutions be included every year has been added for both accountants
and internal auditors. However, in response to the proposed reduction
in testing requirements applicable to internal auditors, the FDIC would
increase the size of the sample required to be tested by the
independent public accountant from 20 to 30 percent of the transactions
in the sample used by the internal auditor. This change would generally
not result in any increase in the number of transactions tested by the
independent public accountant for reports on holding companies with two
or more covered subsidiary institutions. Previously, the internal
auditor had to perform procedures on a sample of transactions from each
covered subsidiary and the independent public accountant had to test a
sample from the consolidated holding company that was at least 20
percent of the size of the aggregate samples used by the internal
auditor. Under the proposal, the internal auditor may also select a
sample on a consolidated holding company basis (so long as some
transactions come from each covered subsidiary institution at least
every two or three years), but the accountant would have to test a
sample of transactions that was at least 30 percent of the size of the
sample used by the internal auditor. In most cases, testing 30 percent
of the number of transactions in the one sample from the consolidated
entity used by the internal auditor will consist of fewer transactions
to test than 20 percent of the transactions included in the samples
aggregated from each covered institution.
The changes and reformatting in the procedures from the current
rule to the proposal are outlined in the table below:
----------------------------------------------------------------------------------------------------------------
Subject Old section I New section I
----------------------------------------------------------------------------------------------------------------
Insider Loans:
Designated Laws and Regulations............................. A.1 A.1
General Information......................................... A.2.a. A.2.a
Calculations................................................ A.2.b A.4
Policies and Procedures..................................... A.2.c A.3
Insider Transactions........................................ A.2.d A.5
Loans to Correspondent Banks................................ A.2.d.(1) A.10
Aggregate Indebtedness...................................... A.2.d.(2)(a) A.2.b.(3)
A.2.d.(7)
A.8
Executive Officers.......................................... A.2.d.(2)(b) & (c) Deleted
A.2.e.(ii) A.7
Insider Extensions of Credit................................ A.2.d.(2)(d) & (e) A.5, A.6
A.2.d.(5) & (6)
Overdrafts.................................................. A.2.d.(3) A.9
Reports on Indebtedness to..................................
Correspondent Banks......................................... A.2.e. A.10
Dividend Restrictions:
Designated Laws and Regulations............................. B.1 B.1
General Information......................................... B.2 B.2
Policies and Procedures..................................... B.2.b B.3
Board Minutes............................................... B.2.c B.4
Calculation of Undercapitalization.......................... B.2.d B.5
Dividends Declared by Banks................................. B.2.e B.6
Dividends Declared by Savings Associations.................. B.2.f B.7
----------------------------------------------------------------------------------------------------------------
[[Page 8587]]
Subject Old section II New section II
----------------------------------------------------------------------------------------------------------------
Procedures for the Independent Public Accountant:
Designated Laws and Regulations............................. A. & B.1 A. & B.1
Internal Auditor's Workpapers............................... B.2 B.2
Testing..................................................... C. B.3
Reports Concerning Holding Companies........................ D. B.4
----------------------------------------------------------------------------------------------------------------
D. Timing and Effective Date
Since the vast majority of covered institutions have fiscal years
that coincide with the calendar year, they will be or are in the
process of preparing the annual reports and having the agreed-upon
procedures performed. In order to make this process less burdensome for
institutions and their accountants, the FDIC will raise no objection if
an institution chooses to follow immediately the provisions of this
proposal for any fiscal year that ends prior to such time as any final
amendment is adopted. However, if an institution chooses to follow
these provisions and procedures, it must do so for both of the
Designated Laws.
III. Regulatory Flexibility Act
The rule expressly exempts insured depository institutions having
assets of less than $500 million, and, for that reason, is inapplicable
to small entities. Therefore, pursuant to section 605(b) of the
Regulatory Flexibility Act (Pub. L. 96-354, 5 U.S.C. 601 et seq.), the
FDIC Board of Directors certifies that the rule would not have a
significant impact on a substantial number of small entities.
IV. Paperwork Reduction Act
The proposed rule would reduce the burden in a collection of
information that has been reviewed and approved by the Office of
Management and Budget under control number 3064-0113, pursuant to the
Paperwork Reduction Act of 1980 (44 U.S.C. 3501 et seq.). The currently
approved burden for this collection is 76,330 hours per year. Of the
reports filed during the first year of implementation of Part 363,
nearly half (500) were submitted using the holding company exception.
However, institutions generally reported that the time expended was
greater than had been previously estimated. For this reason, the hours
per response estimated is nearly double the previous estimate.
The amended provisions of RCDRIA permit additional use of the
holding company exception. Additional burden reduction is expected from
the reformatted and streamlined specific procedures in Schedule A to
Appendix A to Part 363. It is expected that the proposal would reduce
the currently approved burden by 18,360 hours, to an industry-wide
total of 57,970 hours per year.
The total estimated reporting burden for the collection under Part
363 as it is proposed to be amended would be:
Number of Respondents: 450.
Number of Responses Per Respondent: 3.19.
Total Annual Responses: 1,435.5.
Hours per Response: 40.38.
Total Annual Burden Hours: 57,970.
The proposed changes to this collection of information have been
submitted to OMB for review and approval pursuant to the Paperwork
Reduction Act. Comments on the accuracy of the burden estimate, and
suggestions for reducing the burden, should be directed to the Office
of Management and Budget, Paperwork Reduction Project 3064-0113,
Washington, D.C. 20503, with copies of such comments to Steven F.
Hanft, Office of the Executive Secretary, Room F-400, 550 17th St.
N.W., Washington, D.C. 20429.
List of Subjects in 12 CFR Part 363
Accounting, Administrative practice and procedure, Banks, Banking,
Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, the Board of Directors
of the FDIC proposes to amend part 363 of title 12, chapter III, of the
Code of Federal Regulations as follows:
PART 363--ANNUAL INDEPENDENT AUDITS AND REPORTING REQUIREMENTS
1. The authority citation for part 363 continues to read as
follows:
Authority: 12 U.S.C. 1831m.
2. Section 363.1 is amended by revising paragraph (b) to read as
follows:
Sec. 363.1 Scope.
* * * * *
(b) Compliance by subsidiaries of holding companies. (1) The
audited financial statements requirement of Sec. 363.2(a) may be
satisfied for an insured depository institution that is a subsidiary of
a holding company by audited financial statements of the consolidated
holding company.
(2) The other requirements of this part for an insured depository
institution that is a subsidiary of a holding company may be satisfied
by the holding company if:
(i) The services and functions comparable to those required of the
insured depository institution by this part are provided at the holding
company level; and
(ii) Either the insured depository institution has total assets as
of the beginning of such fiscal year of:
(A) Less than $5 billion; or
(B) $5 billion or more and a composite CAMEL rating of 1 or 2.
(3) The appropriate federal banking agency may suspend the
exception in paragraph (b)(2) of this section regarding any institution
with total assets in excess of $9 billion for any period of time during
which the appropriate federal banking agency determines that the
institution's exemption would create a significant risk to the affected
deposit insurance fund.
3. Section 363.4 is amended by revising paragraph (b) to read as
follows:
Sec. 363.4 Filing and notice requirements.
* * * * *
(b) Public availability. The annual report in paragraph (a)(1) of
this section shall be available for public inspection.
* * * * *
4. Section 363.5 is amended by revising paragraph (b) to read as
follows:
Sec. 363.5 Audit committees.
* * * * *
(b) Committees of large institutions. The audit committee of any
insured depository institution that has total assets of more than
Sec. 3 billion, measured as of the beginning of each fiscal year, shall
include members with banking or related financial management expertise,
have access to its own outside counsel, and not include any large
customers of the institution. If a large institution is a subsidiary of
a holding company and relies on the audit committee of the holding
company to comply with this part, the holding company audit committee
shall not include any members who are large customers of the subsidiary
institution. [[Page 8588]]
5. Appendix A to Part 363 is amended by revising guidelines 4(c),
9, footnote 2 in guideline 10, footnote 3 in guideline 15(b), 24, 31,
and the introductory paragraph of guideline 32 and footnotes 2 and 3 to
read as follows:
Appendix A to Part 363--Guidelines and Interpretations
* * * * *
4. Comparable Services and Functions. * * * (c) Prepares and
submits the management assessments of the effectiveness of the
internal control structure and procedures for financial reporting
(internal controls), and compliance with the Designated Laws defined
in guideline 12 that are based on information concerning the
activities and operations of those subsidiary institutions within
the scope of the rule.
* * * * *
9. Safeguarding of Assets. ``Safeguarding of assets'', as the
term relates to internal control policies and procedures regarding
financial reporting, and which has precedent in accounting
literature, should be addressed in the management report and the
independent public accountant's attestation discussed in guideline
18. Testing the existence of and compliance with internal controls
on the management of assets, including loan underwriting and
documentation, represents a reasonable implementation of section 36.
Management therefore should include such internal controls as part
of its assertion in the management report. The accountant's
attestation to management's assertion concerning the effectiveness
of internal controls for financial reporting should also include
safeguarding of assets against unauthorized acquisition, use or
disposition.1
\1\ It is management's responsibility to establish policies
concerning underwriting and asset management and to make credit
decisions. The auditor's role is to test compliance with
management's policies relating to financial reporting.
---------------------------------------------------------------------------
10. * * *\2\
\2\In considering what information is needed on safeguarding of
assets and standards for internal controls, management may review
guidelines provided by its primary federal regulator; the Federal
Financial Institutions Examination Council's ``Supervisory Policy
Statement on Securities Activities''; the FDIC's ``Statement of
Policy Providing Guidance on External Auditing Procedures for State
Nonmember Banks'' (Jan. 16, 1990), ``Statement of Policy Regarding
Independent External Auditing Programs of State Nonmember Banks''
(Nov. 16, 1988), and Division of Supervision Manual of Examination
Policies; the Federal Reserve Board's Commercial Bank Examination
Manual and other relevant regulations; the Office of Thrift
Supervision's Thrift Activities Handbook; the Comptroller of the
Currency's Handbook for National Bank Examiners; standards published
by professional accounting organizations, such as the American
Institute of Certified Public Accountant's (AICPA) Statement on
Auditing Standards No. 55, ``Consideration of the Internal Control
Structure in a Financial Statement Audit''; the Committee of
Sponsoring Organizations (COSO) of the Treadway Commission's
Internal Control--Integrated Framework, including its addendum on
safeguarding of assets; and other internal control standards
published by the AICPA, other accounting or auditing professional
associations, and financial institution trade associations.
---------------------------------------------------------------------------
* * * * *
15. * * *
(b) * * *\3\ * * *
\3\These would include standards for Performing and Reporting on
Peer Reviews, codified in the SEC Practice Section Reference Manual,
and Standards for Performing and Reporting on Peer Reviews,
contained in Volume 2 of the AICPA's Professional Standards.
---------------------------------------------------------------------------
* * * * *
24. Relief from Filing Deadlines. Although the reasonable
deadlines for filings and other notices established by this part are
specified, some institutions may occasionally be confronted with
extraordinary circumstances beyond their reasonable control that may
justify extensions of a deadline. In that event, upon written
application from an insured depository institution, setting forth
the reasons for a requested extension, the FDIC or appropriate
federal banking agency may, for good cause shown, extend a deadline
in this part for a period not to exceed 30 days.
* * * * *
31. Holding Company Audit Committees. When an insured depository
institution subsidiary fails to meet the requirements for the
holding company exception in Sec. 363.1(b)(2) or maintains its own
separate audit committee to satisfy the requirements of this part,
members of the independent audit committee of the holding company
may serve as the audit committee of the subsidiary institution if
they are otherwise independent of management of the subsidiary, and,
if applicable, meet any other requirements for a large subsidiary
institution covered by this part. However, this would not permit
officers or employees of the holding company to serve on the audit
committee of its subsidiary institutions. When the subsidiary
institution satisfies the requirements for the holding company
exception in Sec. 363.1(b)(2), members of the audit committee of the
holding company should meet all the membership requirements
applicable to the largest subsidiary depository institution and may
perform all the duties of the audit committee of a subsidiary
institution, even though such holding company directors are not
directors of the institution.
32. Duties. The audit committee should perform all duties
determined by the institution's board of directors. The duties
should be appropriate to the size of the institution and the
complexity of its operations, and include reviewing with management
and the independent public accountant the basis for the reports
issued under Secs. 363.2 (a) and (b) and 363.3(a) and (b) of the
rule. Appropriate additional duties could include:
* * * * *
6. Schedule A to Appendix A to Part 363 is revised to read as
follows:
Schedule A to Appendix A--Agreed Upon Procedures for Determining
Compliance With Designated Laws
i. Schedule A is attached to the Guidelines and Interpretations
issued by the FDIC as an appendix to this part 363 adopted to
implement section 36 of the FDI Act.
ii. The Agreed Upon Procedures set forth in this schedule are
referred to in guideline 19. They should be followed by the
institution's independent public accountant (or, with respect to the
procedures set forth in section I of this schedule, by the
institution's internal auditor if the accountant is to perform the
procedures set forth in section II of this schedule) in order to
permit the accountant to report on the extent of compliance with the
Designated Laws (defined in guideline 12) as required by section
36(e) (1) and (2).
iii. Additional guidance concerning the role of the institution,
its internal auditor, and its independent public accountant in
assessing the institution's compliance with the Designated Laws is
set forth in the Guidelines. All terms not defined in this schedule
have the meanings given them in this part 363, the Guidelines, and
professional accounting and auditing literature.
Section I--Procedures for Individual Institutions
The following procedures should be performed by the
institution's independent public accountant in accordance with
generally accepted standards for attestation engagements, or by the
institution's internal auditor if the procedures set forth in
section II of this schedule are to be performed by the independent
public accountant. To the extent permitted by Sec. 363.1(b), these
procedures may be performed on a holding company basis rather than
at each covered subsidiary insured depository institution. (See
section II.B.3. for information concerning testing by the
independent public accountant when the institution's internal
auditor is performing the procedures in Section I.)
A. Loans to Insiders.
1. Designated Laws. The following federal laws and regulations
(Designated Insider Laws), to the extent that they are applicable to
the institution, should be read:
a. Laws: 12 U.S.C. 375, 375a, 375b, 376, 1468(b), 1828(j)(2),
1828(j)(3)(B), and 1972; and
b. Regulations: 12 CFR 23.5, 31, 215, 337.3, 349.3, and 563.43.
2. General.
a. Information. Obtain from management of the institution, the
following information for the institution's fiscal year:
(1) Management's assessment of compliance with the Designated
Insider Laws;
(2) All minutes (including minutes drafted, but not approved) of
the meetings of the board and committees of the board which have
been delegated authority pertaining to insider lending;
(3) Reports of examination, supervisory agreements, and
enforcement actions issued by the institution's primary federal and
state regulators, if applicable;
(4) The annual survey which identifies all insiders of the
institution (i.e., directors, executive officers, and principal
shareholders, and includes their related interests) and/or other
records maintained for insiders of the institution's affiliates
(pursuant to 12 CFR 215.8(c));
(5) All Forms 10-K, 10-Q, and 8-K and proxy statements filed
with the SEC and [[Page 8589]] comparable documents filed with the
FDIC, Federal Reserve Board, OCC, or OTS under the Securities
Exchange Act of 1934 containing information pertaining to insider
lending;
(6) A list of loans, including all overdrafts of executive
officers and directors,1 and other extensions of credit to
insiders (including their related interests) outstanding at any time
during the fiscal year (and which identifies those extensions
granted during the year) as well as the amounts outstanding of such
extensions of credit as of the date of the most recently completed
Call Report or TFR (Insider Extensions List); and
\1\Overdrafts of an executive officer or director in an
aggregate amount of $1,000 or less need not be included on this list
if management provides a written representation that policies and
procedures are in effect to report as extensions of credit all
overdrafts that do not meet the criteria listed in paragraph 9.a.(2)
of this section concerning overdrafts in an aggregate amount of
$1,000 or less.
---------------------------------------------------------------------------
(7) Management's written representation concerning the
completeness of:
(a) Its records concerning insider loans and extensions of
credit; and
(b) The Insider Extensions List.
b. Procedures:
(1) Read the foregoing information.
(2) If the institution has excluded any officers or directors
from being considered executive officers for purposes of paragraph
2.a.(4) of this section, ascertain that any such exclusions have
been approved by resolution of the board or the bylaws of the bank
or company.
(3) Trace and agree each insider loan and other extension of
credit disclosed in the documents listed in paragraphs 2.a. (2)
through (5) of this section to see that it is included on the
Insider Extensions List.
3. Policies and Procedures.
a. Information. Obtain the institution's written policies and
procedures concerning its compliance with the Designated Insider
Laws, including any written ``Code of Ethics'' or ``Conflict of
Interest'' policy statements. If the institution has no written
policies and procedures, obtain a narrative from management that
describes the methods for complying with such laws and regulations,
and includes provisions similar to those listed in paragraph A.3.b
of this section.
b. Procedures. Ascertain that the policies and procedures
include, or incorporate by reference, provisions consistent with the
Designated Insider Laws for:
(1) Defining terms;
(2) Restricting loans to insiders;
(3) Maintaining records of insider loans;
(4) Requiring reports and/or disclosures by the institution and
by executive officers, directors, and principal shareholders (and
their related interests);
(5) Disseminating policy information;
(6) Revising policies to reflect subsequent changes in the law
and regulations;
(7) Educating employees about the legal requirements and
management's related policies and procedures;
(8) Prior approval of the board of directors; and
(9) Reporting insider loans to regulatory agencies on the
institution's Call Report or TFR.
4. Calculations of Lending Limits.
a. Information. Obtain management's calculation of the following
items as of the date of the institution's most recently completed
Call Report or TFR and as of a Call Report or TFR date six or nine
months earlier:
(1) The institution's unimpaired capital and surplus (the legal
lending limit for all insiders);
(2) The greater of 5 percent of the institution's unimpaired
capital and surplus or $25,000; and
(3) The institution's individual lending limit (12 CFR
215.4(c)).
b. Procedures. Recalculate the amounts in paragraph 4.a. of this
section for mathematical accuracy, and trace the amounts used in
management's calculations to the most recently completed Call Report
or TFR.
5. Insider Extensions of Credit Granted.
a. Information. Obtain management's written representations
regarding whether the terms and creditworthiness of insider
extensions of credit granted during the fiscal year are comparable
to those that would have been available to unaffiliated third
parties.
b. Procedures. Select a sample of insiders who were granted or
had outstanding extensions of credit during the fiscal year from the
Insider Extensions List. For each extension of credit granted during
the fiscal year to each insider in the sample selected:
(1) If a credit granted during the year (aggregated with all
other extensions of credit to that person and all related interests
of that person) exceeds the lesser of the amounts calculated in
paragraph 4.a.(2) of this section on either of the dates used in
paragraph 4.a. of this section or $500,000, read the minutes of the
meetings of the board of directors and determine whether the minutes
indicate that:
(a) The credit was approved in advance by the board; and
(b) The insider abstained from participating directly or
indirectly in voting on the transactions;
(2) Obtain management's calculation of the institution's
individual lending limit for insiders pursuant to 12 CFR 215.4(c) as
of the date when the extension of credit was granted and ascertain
whether the amount of the extension of credit being granted to the
insider, when combined with all other extensions of credit to that
insider, exceeds such limit;
(3) Based on the types of extensions of credit granted during
the fiscal year in the sample selected, select a sample of three (or
such smaller number that exists) for each similar type of extension
of credit to persons who are not insiders or employees of the
institution or its affiliates that were granted within four weeks
before or after the granting of the insider extension of credit:
(a) Compare the terms of the transactions with the persons not
affiliated with the institution to those with the insiders, and note
in the findings any material differences in the terms favorable to
the insiders compared to the terms of the transactions with persons
not affiliated with the institution or its affiliates;
(b) Alternatively, if no comparable transactions with persons
who are not insiders exist within the time period specified in
paragraph 5.b.(3) of this section, compare the terms of the insider
transaction to approved policies delineating the interest rate and
other terms and conditions in effect for similar extensions of
credit to unaffiliated persons. Note in the findings any material
differences in the terms favorable to the insiders compared to the
terms of the approved policies for an extension of credit to persons
not affiliated with the institution or its affiliates;
(4) For each extension of credit granted to each executive
officer in the sample selected in paragraph 5.b. of this section,
ascertain that each credit was:
(a) Preceded by submission of financial statements;
(b) Approved by, or promptly reported to, the board of
directors, as appropriate; and
(c) Made subject to the written condition, as specified in the
note or other evidence of indebtedness, that the extension of credit
will become, at the option of the institution, due and payable at
any time that the executive officer is indebted to other insured
institutions in an aggregate amount greater than the executive
officer would be able to borrow from the institution.
6. Insider Extensions of Credit Outstanding.
a. Information. Use the sample of insiders selected in paragraph
5.b. of this section.
b. Procedure. Trace and agree amounts outstanding from insiders
in the sample to the supporting documents, as applicable, for the
line item aggregating indebtedness of all insiders on the
institution's most recently completed Call Report or TFR.
7. Limitation on Extensions of Credit to Executive Officers.
a. Information. From the sample selected in paragraph 5.b. of
this section, select the executive officers who were granted
extensions of credit during the year.
b. Procedures.
(1) For each executive officer selected, obtain management's
calculation as of the two dates used in paragraph 4.a. of this
section of:
(a) The aggregate amount of extensions of credit to the
executive officer; and
(b) 2.5 percent of the institution's unimpaired capital and
surplus.
(2) Ascertain whether, and report as an exception if, the
aggregate amount of the extensions of credit to the executive
officer exceeds the greater of $25,000 or 2.5 percent of the
institution's unimpaired capital and surplus, but in no event more
than $100,000. The aggregate amount should exclude the types of
extensions of credit set forth in 12 CFR 215.5(c)(1) through (3).
(3) Recalculate management's computations for mathematical
accuracy and trace amounts used in management's computations to the
institution's most recently completed Call Report or TFR.
(4) If the credit extended is a real estate loan, obtain
documentation for the credit and note whether such documentation
contains representations that:
(a) The purpose of the credit is for the purchase, construction,
maintenance, or improvement of the executive officer's residence;
[[Page 8590]]
(b) The credit is secured by a first lien on the residence; and
(c) The executive officer owns or expects to own the residence
after the extension of credit.
8. Aggregate Insider Extensions of Credit Outstanding.
a. Information. Obtain management's calculation of the aggregate
extensions of credit to executive officers, directors, and principal
shareholders of the institution and to their related interests as of
the two dates selected in paragraph 4.a. of this section.
b. Procedures. Recalculate the amounts obtained in paragraph
8.a. of this section for mathematical accuracy.
(1) Compare this total with 100 percent of the institution's
unimpaired capital and surplus calculated in paragraph 4.a.(1) of
this section.
(2) Report any amount by which the aggregate extensions of
credit exceed 100 percent of the institution's capital and surplus
as an exception in the findings.
9. Overdrafts.
a. Information. Select a sample of insiders from the Insider
Extensions List who had overdrafts outstanding during the fiscal
year.
(1) Obtain a written history of the insider's overdrafts for the
year and management's written representation concerning the
completeness of that history.
(2) For overdrafts of an executive officer or director in an
aggregate amount of $1,000 or less included in the sample, obtain
management's written representation that:
(a) It believes the overdrafts were inadvertent;
(b) The account was overdrawn in each case for no more than 5
business days; and
(c) The institution charged the executive officer or director
the same fee that it would charge any other customer in similar
circumstances.
b. Procedures. For each overdraft by an insider in the sample
selected in paragraph 9.a. of this section:
(1) Inquire whether cash items for the insider were being held
by the institution during the time that the overdraft was
outstanding to prevent additional overdrafts;
(2) Trace and agree subsequent payment by the insider of the
insider's overdrafts to records of the account at the institution;
and
(3) For overdrafts of executive officers and directors included
in the sample that were paid by the institution for the executive
officer and director from an account at the institution:
(a) Trace and agree to a written, pre-authorized, interest-
bearing extension of credit plan that specifies a method of
repayment; or
(b) Trace and agree to a written, pre-authorized transfer of
funds from another account of the insider at the institution.
10. Reports on Indebtedness to Correspondent Banks.
a. Information. Obtain from management:
(1) A list of executive officers and principal shareholders and
related interests thereof that filed reports of indebtedness to a
correspondent bank. This list should be prepared as of the calendar
year for which the management assessment and independent public
accountant's attestation are being filed. If the institution is not
on a calendar year fiscal year, the list should be prepared as of
the end of the calendar year during its fiscal year.
(2) Its written representation concerning the completeness of
the list for paragraph 10.a.(1) of this section and its written
representation that all executive officers and principal
shareholders have been notified of the reporting requirements for
the calendar year in paragraph 10.a.(1) of this section relative to
borrowings from correspondent banks by executive officers and
principal shareholders and their related interests.
(3) Its representation concerning the amount each executive
officer would have been able to borrow from the reporting
institution.
b. Procedures. Select a sample of executive officers, principal
shareholders, and related interests thereof from the list obtained
in paragraph 10.a.(1) of this section.
(1) Ascertain that each executive officer and principal
shareholder (or related interest thereof) included in the sample
reported to the board of directors (on or before the January 31
following the calendar year in paragraph 10.a.(1)), indebtedness to
correspondent banks and that such report states:
(a) The maximum amount of indebtedness during that calendar
year;
(b) The amount of indebtedness outstanding 10 days prior to
report filing; and
(c) A description of the loan terms and conditions, including
the rate or range of interest rates, original amount and date,
maturity date, payment terms, security, and any unusual terms or
conditions.
(2) If any executive officer's extensions of credit from all
correspondent banks from the list obtained in paragraph 10.a.(1) of
this section exceed the total amount that management represents that
the executive officer would have been able to borrow from the
reporting institution during the fiscal year, note whether a report
pursuant to 12 CFR 215.9 was made to the board of directors of the
officer's institution within 10 days of the date the indebtedness
reached such a level.
B. Dividend Restrictions. If the institution has declared any
dividends during the fiscal year, the following procedures should be
performed for each dividend declared. (These procedures are not
applicable to mutual institutions and insured branches of foreign
banks.)
1. Designated Laws. The following federal laws and regulations
(Designated Dividend Laws), to the extent that they are applicable
to the institution (see paragraph 2 below), should be read:
a. Laws: 12 U.S.C. 56, 60, 1467(a)(f), 1831o; and
b. Regulations: 12 CFR 5.61, 5.62, 6, 7.6120, 19, 208.19,
208.30, 263, 325.105, 563.134, and 565.
2. General. Although the information requirements and procedures
in paragraphs 2. through 5. of this section are applicable to all
institutions, paragraphs 6. and 7. of this section were designed to
be applicable to national banks and federally-chartered savings
associations. However, if the institution is state chartered, and
the state has dividend restrictions substantially identical to those
for national banks and federally-chartered savings associations, the
requirements in paragraphs 6. and 7. of this section for information
and procedures to be performed should be applied to the state bank
or savings association.
a. Information. Obtain from management of the institution the
following information for the institution's most recent fiscal year:
(1) Its assessment of the institution's compliance with the
Designated Dividend Laws and any applicable state laws and
regulations cited in its assessment.
(2) A copy of any supervisory agreements with, orders by, or
resolutions of any regulatory agency (including a description of the
nature of any such agreements, orders, or resolutions) containing
restrictions on dividend payments by the institution.
(3) Its written representation whether dividends declared comply
with any restrictions on dividend payments under any supervisory
agreements with, orders by, or resolutions of any regulatory agency
(including a description of the nature of any such agreements,
orders, or resolutions).
b. Procedures.
(1) Read the foregoing information.
(2) If any restrictions on dividend payments exist in any
documents obtained in paragraph 2.a.(2) of this section, test and
agree dividends declared with any such quantitative restrictions.
3. Policies and Procedures.
a. Information. Obtain the institution's written policies and
procedures concerning its compliance with the Designated Dividend
Laws. If the institution has no written policies and procedures,
obtain from the institution a narrative that describes the
institution's methods for complying with the Designated Dividend
Laws, and includes provisions similar to those below.
b. Procedures: Ascertain whether the policies and procedures
include, or incorporate by reference, provisions which are
consistent with the Designated Dividend Laws. These would include
capital limitation tests, including section 38 of the Federal
Deposit Insurance Act (12 U.S.C. 1831o), earnings limitation tests,
transfers from surplus to undivided profits, and restrictions
imposed under any supervisory agreements, resolutions, or orders of
any federal or state bank regulatory agency. In addition, for
savings associations, this would include prior notification to the
OTS.
4. Board Minutes.
a. Information. Obtain the minutes of the meetings of the board
of directors for the most recent fiscal year to ascertain whether
dividends (either paid or unpaid) have been declared.
b. Procedures. Trace and agree total dividend amounts to the
general ledger records and the institution's most recently completed
Call Report or TFR.
5. Calculation of Undercapitalization.
a. Information. Obtain management's computation of the amount at
which declaration of a dividend would cause the institution to be
undercapitalized as of each date on which a dividend was declared
during the fiscal year.
b. Procedures: Recalculate management's computation (for
mathematical accuracy) and [[Page 8591]] compare management's
calculations to the amount of any dividend declared to determine
whether it exceeded the amount.
6. Dividends Declared by Banks.
a. Information. Obtain the computations by the management of
each national and state member bank concerning the bank's compliance
with 12 U.S.C. 56, ``Capital Limitation Test'', 12 U.S.C. 60, ``The
Earnings Limitation Test'', and transfers from surplus to undivided
profits after declaration of the dividends referenced in paragraph
4.a. of this section. In a state with substantially similar laws,
obtain the corresponding computations by the management of each
state nonmember bank.
b. Procedures. Recalculate management's computations (for
mathematical accuracy) and compare management's calculations to the
standards defined in the tests set forth in paragraph 6.a. of this
section to ascertain whether the dividends declared fall within the
permissible levels under these standards. If dividends are not
permissible in the amounts declared under such standards, ascertain
whether the dividends were declared with the approval of the
appropriate federal banking agency or under any other exception to
the standards. If not, report the findings.
7. Dividends Declared by Savings Associations.
a. Information. Obtain management's documentation of the OTS
determination whether the institution is a Tier 1, Tier 2, or Tier 3
savings association and management's computations of its capital
ratio after declarations of dividends under the Tier determined by
the OTS. For dividends declared, obtain copies of the savings
association's notifications to the OTS to ascertain whether
notifications were made at least 30 days before payment of any
dividends.
b. Procedures: Recalculate management's computations (for
mathematical accuracy) and trace amounts used by management in its
calculations to the institution's TFRs.
Section II--Procedures for the Independent Public Accountant
If the internal auditor has performed the procedures set forth
in section I for either or both Designated Laws, the following
procedures may be performed by the independent public accountant for
the appropriate designated law(s) if neither the FDIC nor the
appropriate federal banking agency has objected in writing. The
report of procedures performed and list of exceptions found by the
internal auditor, identifying the institution with respect to which
any exception was found, should be submitted to the audit committee
of the board of directors. Management should file a summary of the
internal auditor's significant findings and management's response to
those findings with the FDIC at the same time as the independent
public accountant's attestation report is filed.2
\2\Since this summary supplements the independent public
accountant's attestation on the Designated Laws, the FDIC has
determined that the summary is exempt from public disclosure
consistent with the guidance in Guideline 18 in Appendix A to this
part 363.
---------------------------------------------------------------------------
A. Review of Designated Laws. Read either or both of the
Designated Insider Laws and Designated Dividend Laws applicable to
the institution, as appropriate to the engagement.
B. Information and Procedures. Perform the procedures indicated
as follows:
1. Designated Laws. Read Section I of this schedule. Obtain
management's assessment contained in its management report on the
institution's or holding company's compliance with the Designated
Laws for the fiscal year.
2. Internal Auditor's Workpapers.
a. Information. If an internal auditor performed the procedures
in Section I, obtain the internal auditor's workpapers documenting
the performance of those procedures on the institution and the chief
internal auditor's written representation that:
(1) The internal auditor or audit staff, if applicable,
performed the procedures listed in section I on the institution;
(2) The internal auditor tested a sufficient number of
transactions governed by the Designated Laws so that the testing was
representative of the institution's volume of transactions;
(3) The workpapers accurately reflect the work performed by the
internal auditor and, if applicable, the internal audit staff;
(4) The workpapers obtained are complete; and
(5) The internal auditor's report, which describes the
procedures performed for the fiscal year as well as the internal
auditor's findings and exceptions noted, has been presented to the
institution's audit committee.
b. Procedures.
(1) Compare the workpapers to the procedures that are required
to be performed under section I. Report as an exception any
procedures not documented and any procedures for which the sample
size is not sufficient.
(2) Compare the exceptions and errors listed by the internal
auditor in its report to the audit committee to those found in the
workpapers, and report as an exception any exception or error found
in the internal auditor's workpapers and not listed in the internal
auditor's list of exceptions.
3. Testing. a. The independent public accountant should perform
the procedures listed in Section I on representative samples of the
insiders and/or transactions of the institution to which the
Designated Law applies. If the institution's internal auditor is
performing the procedures in Section I, the samples tested by the
independent public accountant should be at least 30 percent of the
size of the samples tested by the internal auditor although samples
selected by the accountant should be from the population at large.
However, if there are so few transactions in any area that the
internal auditor cannot use sampling, but must test all
transactions, the independent public accountant should also test all
transactions.
b. If the testing is being performed on a holding company with
more than one subsidiary institution that is subject to this part
363 (covered subsidiary), the samples tested should include a
combination of insiders and transactions from each covered
subsidiary with total assets (after deductions of intercompany
amounts that would be eliminated in consolidation) in excess of 25
percent of the holding company's total assets every fiscal year.
Samples should be tested for each smaller covered subsidiary at
least every other fiscal year unless the holding company has more
than eight covered subsidiaries, in which case the samples to be
tested for each Designated Law should be drawn from each smaller
covered subsidiary at least every third fiscal year.
4. Reports Concerning Holding Companies. Only one report of any
exceptions noted from application of the procedures in section II
performed by the independent public accountant should be filed as
required by guideline 3 in Appendix A to this part 363, but the
report should identify, for each exception or error noted, the
identity of the covered subsidiary to which it relates.
By order of the Board of Directors.
Dated at Washington, D.C. this 31st day of January, 1995.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
Acting Executive Secretary.
[FR Doc. 95-3176 Filed 2-14-95; 8:45 am]
BILLING CODE 6174-01-P
