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Safety and Soundness

Regulations

Congress has assigned to the Federal Reserve responsibility for implementing certain laws pertaining to a wide range of banking and financial activities. Those laws are implemented in part through regulations. These regulations are organized by alphabetical letter and occasionally are modified to meet the current needs of the financial community. The public is invited to provide input to proposed modifications via the comment letter process. The Board of Governors website includes a comprehensive list of Federal Reserve regulations, from A through FF. (See the list of Federal Reserve regulatory guidance.)

The Examination Process

Federal Reserve examinations are carried out in accordance with supervisory mandates that establish expectations about the frequency of institution examinations and rating standards that convey criteria to be used in determining a numerical indicator of the institution's overall condition.

State member bank examination results are summarized by an institution's confidential CAMELS and Compliance ratings. CAMELS ratings are explicitly considered in the Federal Deposit Insurance Corporation's deposit insurance pricing, with financially stronger institutions paying smaller insurance premiums and financially weaker institutions paying higher insurance premiums. Only state member banks' Community Reinvestment Act (CRA) ratings are disclosed to the public.

Bank holding companies’, savings and loan holding companies’ and financial holding companies' examination frequency requirements are established by policy with examination results summarized by the institution's confidential RFI/C(D) rating, or in the case of savings and loan holding companies, the indicative RFI rating.

The Fed's examination processes are described in a series of comprehensive examination manuals.

Enforcement Actions

The Federal Reserve utilizes enforcement actions as supervisory tools to work with institutions when circumstances warrant an increase in the level of supervisory oversight. Enforcement actions can be formal or informal and require an institution’s board of directors to address financial and/or risk management deficiencies identified through the examination or inspection process. Formal enforcement actions are distinguished from informal actions as they are legally enforceable and are generally made public on the Board of Governors’ website.

Membership Information

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Federal Reserve Bank of Chicago, 230 South LaSalle Street, Chicago, Illinois 60604-1413, USA. Tel. (312) 322-5322

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