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PR-99-80 (10-14-80) F O R IM M E D IA T E R E L E A S E PÇT 1 5 1980 federal deposit insurance CORPORATION F D IC C H A IR M A N D E T A IL S IM P R O V E D S U P E R V IS IO N , LE SSE N E D REGU LATO RY BU RD EN THROUGH F E D E R A L /S T A T E C O O P E R A T IO N CHICAGO More than 30 percent of the 9,300 insured State nonmember banks super vised by the Federal Deposit Insurance Corporation will be covered by the end of 1980 by alternate instead of dual Federal and State examinations, FDIC Chairman Irvine H. Sprague reported today. In a speech to the annual convention of the American Bankers Association, Sprague said the divided examination program is “the cornerstone and the catalyst” of a broad new initiative in FDIC and State cooperation. The goal is to improve supervision, lessen the regulatory burden on banks and improve service to the public. Sprague said such cooperation is “one of the most underdeveloped resources in banking and bank supervision and promises substantial benefits for bankers, regulators and the public. He called it “a great frontier in banking,” and said expansion of such efforts will continue to be the top priority in his stewardship of the FDIC. In the divided examination program, the FDIC and qualified participating States alter nate and exchange results on annual examinations of non-problem institutions. Sprague also detailed cooperative efforts involving the establishment of regional typing centers to speed the typing of examination reports, legal drafting assistance where State law must be changed to permit cooperative programs, State access to the FDIC’s computerized data base, common enforcement actions and development of common bank application and examination forms. Sprague emphasized that participation in these programs is voluntary, that each State determines the extent of its own involvement. The text of Sprague's speech is attached. FEDERAL DEPOSIT IN S U R A N C E CORPORATION, 5 5 0 Seventeenth St. N.W., Washington, D.C. 20429 202-389-4221 A D D R E S S TO TH E N A T IO N A L C O N V E N T IO N OF THE A M E R IC A N B A N K E R S A S S O C IA T IO N F D IC A N D S T A T E C O O P E R A T I V E IN IT I A T I V E S IN B A N K S U P E R V I S I O N IN THE 1980s By IR V IN E H. S P R A G U E , Chairm an F E D E R A L D E P O S IT IN S U R A N C E C O R P O R A T IO N 2 P.M., Tuesday, October 14, 1 98 0 M cC o rm ick Place, David M ayer Theater Chicago, Illinois It is good to be here with you today. I have always been a strong believer in a constructive dialogue between the banking industry and the banking regula tors, both State and Federal, and among the regulators themselves. In the 1980 s, with more laws than we ever dreamed of a decade ago, and complex regulations to implement them, cooperation and communication are more than just desirable. They are an operational necessity. Cooperation, particularly between the State and Federal banking authorities, is one of the most under developed resources in banking and bank supervision. The opportunity is vast and the promise of benefits is substantial for bankers, for bank regulators at both State and Federal levels, and more importantly for the banking public we all serve. I am not here to announce a future plan or program of Federal-State cooperation. I am here to tell you about what is already taking place — initiatives we intend to expand to the utmost. From the time I became Chairman of the Federc Deposit Insurance Corporation 21 months ago, I hav made Federal-State cooperation a priority. Firsi because it is the logical thing to do. Second, becaus with limited resources and greatly increased responsi bilities, it must be done. It is my intention to continu to push for joint exploration and implementatioi along this very promising banking frontier. Our Div ision of Bank Supervision under Quinton Thompson’ irection enthusiastically supports this program Many States are also in accord. None have posed serious objections. Just last month a newly appointed State supervisor told me: I ve been reading studies and recommenda tions for cooperation going back 20 years. When do we do something?” I told him, “Now, today.” The one big stumbling block over the years has been the notion that if you do one thing with one State you should do it with all States. In other words, try for the lowest common denominator, which translates to “not much.” Over at least the past decade, cooperative efforts always foundered on the self-perceived prerogatives of the staffs of the Federal and State organizations and philosophical debate over State rights, plus a little inertia and the press of other business. This time we are not yielding to fruitless debate. We are acting. Here is what we have done for starters: • Eight states participate with the FDIC in a formal divided examination program. Six more are expected to enter into agreements by the start of the year. Under this program, the State and the FDIC alternate examinations on banks not con sidered problems and exchange the reports. • More than 1,800 banks are now covered by the divided examination program. One thousand more are expected to be covered by the start of the year. That would triple participation in two years, extending coverage to more than 30 percent of all banks supervised by the FDIC. • Forty-two States participate to some extent in a com m on enforcem ent program . This may include memoranda of understanding, cease and desist orders and other enforcement procedures undertaken jointly by the State and the FDIC. • Nine States are tied into our computer data bank, giving them access to call reports and other information vital to the supervisory process. • New “core forms” for applications have been created. They are designed to be adaptable to State use, so that in participating States bankers will need to fill out only one form for both State and FDIC purposes. During the rewriting, our FDIC branch application form was reduced from 22 major data requests to 11, and three of these latter requests were materially simplified. • A proposed core examination report form has been sent to a few State bank regulators for pre liminary comment. Like the core application forms, the proposed core examination report is being designed to satisfy the FD IC ’s needs and to be adaptable to the States’ needs. • Regional typing centers have been established to facilitate the typing of FDIC bank examination reports. States enrolled in the divided examina tion program also can have reports typed there. Reports that were taking as long as 90 days to be typed and returned to banks are now being done within a 45-day limit. The Minneapolis Typing Center has already set a record by receiving, typ ing, and returning one State examination report for a North Dakota bank in just two days. We expect our optimum service to work out to some thing longer than that as we get into the program, but it will still be reliable and within deadline. I will go into each of those initiatives in detail later in this address. In the new cooperative program, there is no stick. I believe in the carrot approach. To the States that elect to work with us, we offer more efficiency, faster action, reduced paperwork, free forms, free typing, and free data bank service except for the cost of access equip ment, including telephone lines. For the future, we are looking at education subsidies for cooperating States. And many State supervisors are beginning to suggest other joint initiatives. All insured banks, not just those supervised by the FDIC, stand to be among the beneficiaries of our cooperative program. To the extent that it helps hold down FDIC costs, the program will help us to resist increases in the insurance assessment. The present program was born pretty much because it had to be. We must find new ways to meet burgeoning workload and increased statutory responsibilities in an era of employment ceilings and limited resources. The seeds were sown in 1974 under former Chairman Frank Wille when the FDIC and the States of Georgia, Iowa and Washington joined in a trial withdrawal program. Each side withdrew entirely from the examination of specific banks and relied instead on the examination reports of the other agency. That program was eventu ally dropped because it lacked flexibility and breadth, f but it taught us important lessons on how to structure a new approach on a much broader scale. Today s program has evolved over the past year, and it will continue to adjust to changing needs and circum stances. Its keynote is flexibility, not uniformity. We will not spend time and energy on some visionary project to develop a nationwide approach. Such a pro gram could have little substance. Each State has its own problems, its own laws, its own history, its unique personality. Our approach deals with these realities. We are tailoring our cooperative efforts on a State-byState basis with as many States as want to participate. What we are after is something that will work. I want to make it clear that at no time will we com promise on our standards or our responsibility under the law. But I believe that within these boundaries we have a lot of room to improve State-Federal coopera tion with substantial benefit to regulators, bankers, and the public. In June I wrote to all 50 State banking commission ers. We had had a very successful meeting in the Spring with the commissioners participating in the divided examination program. So I invited all commissioners to look into the possibilities of that program and other specific cooperative programs, and to suggest ideas of their own. I renewed this initiative in September, a I ask each of you today, when you return home, to w ask your supervisor if your State is going to benefit from the cooperative program — and if not why not? You bankers will really decide whether we succeed. Is it worth the effort to eliminate double exam ina tions, slash paperwork, and materially shorten the turnaround time on examination reports and pro cessing of applications? This is the question for you to decide. Let me give you examples of joint programs in two States. Missouri participates with us in a divided exam i nation program that covers most of its banks. The State is in the process of joining with us on common application forms for new banks, facilities, trust powers, relocations and other purposes. We are cooperating on simultaneous submission so that a bank applies at the same time for Federal and State approval. This means that final action can also be virtually simultaneous. Missouri is with us on joint enforcement actions; its banking representatives sign off on all FD IC memoranda of understanding with banks and are included in all enforcement actions. Missouri is reservingjudgment about using our regional typing centers. However, the State usesA common report forms with the FDIC. Missouri a ls o ^ is tied into our computerized bank data system. In Michigan, we participated this year in a limited program featuring a mixture of independent, concur rent and divided examinations. We have had good results. We have agreed to adopt the full divided exam ination program next year. Our agreement with the State banking authority specifies that either agency may independently conduct a special examination or visit a covered bank if necessary — for example, if computer analysis of the bank’s financial condition shows potential problems developing. Michigan and the FDIC also take enforcement actions jointly and the State uses the FDIC examination report form. States which cooperate gain real advantages. The FDIC realizes greater efficiency and a better rein on costs. Banks and the public share in the benefits. STATE C O M M I S S I O N E R S Another lesson of the past is not to rely for continuity on State bank supervisors or FDIC chairmen. I am the fifth chairman of my agency in the past five years. And, since January 1975, there have been 93changes in State banking commissioners. That is a turnover of nearly 200 percent in less than six years. Twenty-eight of these State changes have occurred in the 21 months since I became FDIC Chairman. To show that I speak without fear or favor, I want to point to California, my home State, as one of two turnover champions since January, 1975. California and West Virginia have had six banking commission ers, including acting heads, in six years. Kansas, Maryland, New York and Ohio have had five commissioners each in the same period. Only eight commissioners who were in office during my first term with the Board a decade ago are still serving. They are Harry Bloom of Colorado, Jack Dunn of Georgia, Tom McEldowney of Idaho, Jim Faris of Indiana, Jack Olin of Oregon, Bob Cleveland of South Carolina, Bob Stewart of Texas, and Dwight Bonham of Wyoming. The cornerstone of our cooperative effort is mutual self interest. That is essential if we are to build a solid and durable program that will keep going on its own merits after the people who started it are gone. O VERALL C O O P E R A T IV E EFFORT The framework of our overall FDIC-State coopera tive effort consists of eight programs: divided examina tions, simultaneous processing of applications, re gional typing centers, legal drafting assistance, joint enforcement actions, common application forms, com mon examination forms, and access to the FDIC com puterized data base. Divided Exam ination Program I first want to talk about our divided examination program. This is undertaken in States with high exa miner standards which share our desire to make the most of a precious resource — trained, highly skilled and experienced bank examiners. This program is the cornerstone and catalyst of our Federal-State coopera tive effort. The program offers the potential for significant sav ings in resources for the FDIC and participating States. It promises to reduce the regulatory burden on well managed banks while enabling us to maintain our traditional high-quality supervision of insured State nonmember banks. Regional Directors have full authority and responsi bility to run the program in the States in their regions. Regional Directors will work directly with State authorities, negotiating on the suitability of the pro gram for a given State and working out problems. I have great confidence in our Regional Directors — I appointed nine of them and have known the other five favorably for years. Likewise, the State Supervisors I know have impressed me. The Regional Directors and State Supervisors can do the job together. We are seeking to tailor programs that suit the cir cumstances and that are mutually acceptable to the State authorities and the FDIC. If, for example, we agree to a longer lead-in program in a given State, we will work out a limited agreement until it is possible to go to the full program. We want formal agreements. In the past, we have had some informal programs, but we believe it is better to have the programs and prerogatives spelled out in writ ten agreements signed by the FDIC and the State. We are making the formal program a prerequisite to other benefits to States, including use of the FDIC regional typing centers and access to the FDIC data bank. The concept of the divided examination program is simple: eligible banks are divided into two groups; our FDIC staff examines banks in one group and the State examines the other group. The next year we switch groups. This way each authority is in each bank at least every other year. We supervisors gain from enabling highly skilled employees to extend their capacities. And our best run banks benefit from their own performance because they are subject to fewer examinations. Only the highest rated banks qualify for the program — those which are rated one and two under our Uni form Financial Institutions Rating System and which meet other criteria. Banks rated three, four or five continue to be supervised as in the past. All banks continue to be subject to review under the FD IC’s Integrated Monitoring System, including an annual assessment of their financial condition. The IMS sys tem enables us to keep a computer’s eye focused on key bank operations, even when examiners are not in the bank. The FDIC and the State retain the prerogative of examining any bank at any time. This month New York becomes the eighth State to participate in the divided examination program. New York will be operating on a pilot basis until the first of the year when it will become a full- fledged participant. Six other States are expected to join the program by the start of the year. Alabama, California, Nevada and South Dakota are negotiating full programs. Kansas and North Carolina are discussing limited agreements. When I came to the FDIC in January 1979, only three States — Georgia, New Jersey, and Missouri — were in the program. Illinois, Michigan, North D akota, Nebraska and now New York have joined since I became Chairman. The number of eligible banks benefiting from the program is expected to reach 2,845 in January, compared with 926 in the three original States. The new total would represent more than 30 percent of the 9,300 banks supervised by the FDIC. We are currently cooperating with a number of other States under informal arrangements. We intend to con tinue working with these States to encourage them to expand into the regular divided examination program. Our best estimate now is that 20 States will be partici pating with us in the program by 1982. The require ments for participation are a willing State commis sioner, a qualified State examination staff, and flexible State law. The attitude of bankers toward the divided examina tion program is vitally important to its success. I have heard that in some States the program has received a cool reception because leading banks wanted to be examined by both the State and Federal agencies each year. It is important that banks see their own benefit in the divided examination program and work with it. Other States may face a legal obstacle. In response to my letter of last June, one commissioner in a State with many banks wrote that State law requires an annual State examination of all State banks. However, the commissioner said that the benefits to his State are potentially so significant that the possibility of chang ing the law is being explored. At his request, the FDIC is cooperating by offering legal drafting assistance. Again, in this situation, the support of bankers is vital. If you want it done, the law can be changed — as it already has been changed in three States: Missouri, North Dakota and Nebraska. A commissioner from a State in the Southeast com mented that the program would depend on the qualifi cations of its participants. Our hope is that the promise of the benefits of such a program will encourage States to improve their examiner staffing and training pro grams so that their States can qualify. We are wrestling with that problem in still another State which very definitely wants to participate but which now lacks the staff to qualify. One commissioner mentioned his department’s expe rience with a trial withdrawal examination program six years ago. He said, and I quote: “The program ulti mately was abandoned for reasons which were peri pheral, rather than a failure of the program’s design. Simply stated, the program, while accepted by top level administrators, was critiqued to oblivion by on-line staff in an after-the-fact posture.” All of which returns me to my working thesis — each State is different; we have to deal with each State as an individual. That is why we are not simply talking about a pro gram. We are going ahead and doing it, however and wherever we can get something accomplished. We will spend our time where there is paydirt. States that work with us will quickly find out that there is real benefit in it for themselves and their banks, too. Sim ultaneous Processing of Applications Another of our goals is simultaneous submission of applications by banks to Federal and State regulators. This would simplify things for the bank and enable us at the FDIC to be in the position to act on your application concurrently with the State action or soon thereafter. This single act of cooperation can cut your approval time by months in some States. Regional Typing Centers We believe that, unlike good wine, an examination report does not improve with age. One of our big problems in getting our examination reports back to you is sheer typing workload. Our examiners in 1980 will conduct more than 5,600 safety and soundness examinations and 6,400 compliance examinations. Under our previous practice, all those reports would have to be typed in the 14 FDIC regional offices. These offices are not staffed to handle peak volume, and some of them have unique problems in maintaining a proper staff. What we have done is to establish, effective Sep tember 1, four regional typing centers which eventually will handle most of the report typing for the entire Nation. The facilities are located on the country’s North-South centerline — in Minneapolis, Omaha, Kansas City, and Dallas. Recruiting and hiring are completed, and the centers are operating. Regional offices are sending them reports for typing. Our objective, here at the start, is to get a completed, typed examination report back to the bank within 45 days from the time the examiner walks out your door. We are going to remedy past situations of extreme delay. We are phasing into this program by sending to the typing centers certain reports that the home region cannot do itself within the 45-day limit. These are the reports for banks rated one and two. We see no reason why reports on our highest rated banks should be held up by the typing of the lengthier reports required for banks of greater supervisory concern. We are also permitting States to use the typing cen ters at no charge for reports from our divided examina tion program. North Dakota was the first State to take advantage of this offer. FDIC regions which are keeping up with their typing workload and getting their reports out within 45 days are not now being required to use the typing centers. However, as typist vacancies occur in the regional of fices some positions will be transferred to typing cen ters. Eventually, most of our FDIC examination reports and much of the workload from States in the divided examination program will be typed at the cen ters. We estimate that the system will be fully phased in within four to five years. Legal Drafting A ssistance Another kind of cooperation with States is our legal drafting assistance program. We provide technical assistance to States seeking to change State law for purposes of improved cooperation with the FDIC. I mentioned that we are prepared to help States draft legislation which would facilitate the divided examina tion program. This would include proposed changes in State law' to permit State examinations in alternate years rather than every year, to authorize State accept ance of FDIC examination reports in lieu of State reports, to authorize the examination of affiliates and bank service corporations or similar entities, to autho rize investigative powers and the use of subpoena pow ers, and to provide examiners with access to bank holding company data. In another area we are prepared to help States draft revisions in their liquidation laws. Such changes could facilitate purchase and assumption transactions in volving closed insured State banks and could help establish priorities of creditors in the liquidation of a branch of a failed foreign bank. A third area of assistance is helping States draft changes in enforcement authority which would make for consistency between State and Federal powers. These are just a few of the areas requiring State legislative action where the FDIC can offer technical assistance. Joint Enforcem ent Program The fifth program in our overall cooperative effort, our joint enforcement program, is already widely implemented throughout the country. Briefly, it con sists of the Federal and State agencies joining together on memoranda of understanding with the banks and on enforcement actions. Memoranda are a way of set tling matters at the regional level without the necessity of a formal administrative proceeding invoked by the FDIC Board of Directors under Section 8 of the FDI Act. The joint memorandum tells a bank that both the Federal and State authorities support a given course of action. At present, we consult with all State authorities, as required by law, before issuing a cease and desist order or a less formal memorandum of understanding. In 42 States, the State commissioner and FDIC participate jointly in some or all enforcement actions. We are working to expand this cooperative effort. C o m m o n Application Form s The sixth element of our program is the development of common application forms and in the process mak ing them modern and relevant. Our goal is to work toward application forms that are compatible with State and Federal needs so that a banker need fill out only a single application form for State and FDIC purposes. This is a direct effort on our part to reduce the paperwork required of bankers. We began by creating a special FDIC Task Force, including representatives from the field, to review and revise all of our major application forms. I am talking about applications for branches, relocations, mergers, and insurance for new banks. Some of these forms had not been changed for years. We told our Task Force to see what it could do in terms of updating, streamlining, and cutting down to the things we really need. I will not accept the answer that we are requiring certain information “because we always have.” We told the Task Force to be guided by two principles: One, if we don’t need it, don’t ask for it, and Two, if we have the information anywhere in the Corporation, don’t ask for it again. This last principle gets us out of the posture of asking for information that a bank has supplied us many times before. We don’t want a banker filling out a branch or relocation application to say, “Why do they want that again?” We’ve been a bank for 30 years. They should know all that about us by this time.” It is for this reason, for example, that we modernized our relocation application by throwing out the state ment of condition and the listing of existing facilities. We also reduced the listing of management to a simple notation of changes in management since the last examination. We telescoped the section on the new premises to a half-page from its previous one and a half pages, and in the process got rid of the old laundry list of “Furniture, Fixtures and Equipment”. The part on “Convenience and Needs of the Community” now need be filled out only if the relocation entails a change in the primary trade area; otherwise, these two pages can be omitted. If these pages must be completed, bankers will find it easier to do so because we have dropped the request for the time-consuming compilation of detailed economic and demographic data. We have revised the ’’Relationships and Associations” section to focus on insider activities; any payments to related parties must be fully detailed and supported. We have revised the “Capital Adequacy” section to focus on sources of funds. And we have eliminated the part on “Consis tency of Corporate Powers” with the FDI Act. If it were just a matter of editing down the application to its essentials, I could report to you that we cut this form in half or more. Of course, it is not that simple. Recent laws enacted in response to the demands of a changing world have imposed new responsibilities on us all. in our form rewriting project we have accom modated the requirements of recent laws but added [only what is absolutely essential. For example, we have had to ask for new information on environmental impact of a new facility, including possible energy conservation efforts. We have added questions relating to the Community Reinvestment Act and to buildings or sites included or eligible for the National Register of Historic Places. Like it or not, [these are laws of the land and we will enforce them. We have also provided the exact legal wording of a bank ruptcy clause to be included in leases. I The changes in our application to establish a branch are similar to those for relocations. However, in the case of branch applications we were able to cut out two ■full pages and 11 questions or schedules and to simplify lyour task in providing much of the remaining informaItion. I Our trust services application has been cut down to 13 ¡questions, many of which can be answered simply yes [or no. I We are now working with the States to see if these ¡“core forms” which cover FDIC information needs might also serve as the basis for State forms. States ¡would be free to add to the “core form” as many pages as States feel necessary to meet their own information needs. The result would be a single document in place ■of the two application forms that banks now must file ¡with the FDIC and the State. And banks could file simultaneously with both authorities. For States that participate, the FDIC will print and furnish the forms [free of charge. More than two-thirds of the States have already expressed interest. We have supplied proposed “core forms to all States and asked our Regional Directors to work with them in developing a common form. Earl Manning, Acting Commissioner of Finance in Missouri, followed up a very successful meeting by writing to our Kansas City Regional Director, Joe Prohaska: “I would like to compliment you and your staff on the receptive attitude exhibited during these [negotiations. This Division will stand ready to cooper ate further with respect to any other areas in which duplication and red tape as well as the associated costs can be reduced.” Mr. Manning said that Missouri would begin using the common forms this month. [ Even if we cannot agree on forms, we will work with a State on a mutual distribution of the State and Federal applications so that processing time can be reduced. Bank reporting is a matter of great importance to the Corporation. The information you provide is vital to Jlr FDIC operations. At the same time we want to [impose the least possible reporting burden on banks consistent with obtaining accurate and timely informa tion. For a number of years the FDIC has encouraged Mate banking authorities to use the Federal forms for Reports of Condition and Reports of Income. Fortvfour States use these forms, or an identical text under State letterhead, printed for the States by the FDIC. We are continuing our efforfeto win all the States over. The program has obvious benefits to banks in terms of reduced reporting burden. Co m m on Exam ination Forms A much more difficult undertaking is our effort to develop common bank examination report forms. The problems here are infinitely more complex. We are participating in an Interagency Task Force that is working to develop a “core examination report” for the three Federal bank regulators. This “core report” would cover the basic information each agency requires from its bank examinations. If we are success ful in developing a uniform Federal “core report,” we would hope that the States could use it as the basis of their own examination reports, supplementing it as necessary to meet their own needs or the requirements of State law. The potential benefits here are significant. Super visors would benefit by having examination results presented in a uniform format. Since the FDIC and the Federal Reserve would be using a common report form, States which work with both Federal agencies would have only a single report format to deal with. Where States adopt the common form, they and the Federal regulators would be operating from essentially the same set of standards, making for more rational comparisons. Bankers would realize more consistent and equitable treatment because all banks would be subject to the same standards. Commissioners in Georgia, Minnesota, New Jersey and New York are now looking over drafts prepared by a Task Force subcommittee. We want to get other States involved in this project as soon as possible. We want them to review the “core report” as soon as the Interagency Task Force comes up with a formal proposal and to give us their com ments and the benefits of their thinking on it. We want to cooperate on working out problems. Computerized Data Base A cce ss The eighth element of our overall cooperative effort, access to our computer data base on a shared-cost basis, is another benefit that in the future will be reserved to those States participating in our divided examination program. At present, nine States are tied into our computer network, as are the Comptroller of the Currency and the Federal Reserve. The States are California, Indi ana, Michigan, Missouri, New York, North Dakota, Ohio, Pennsylvania, and Tennessee. In New York, the program has been such a success that the Superintend ent of Banking has eliminated the State call report and now relies on our data system for such information. Would you like that in your State? The banking department in each participating State has a terminal that taps into our bank data base. This gives the banking department immediate access to a wealth of key banking information concerning the banks supervised by that department. The State can obtain call report, income report, and summary of deposit information on all banks and, for State non member banks, examination data and information from FD IC’s Integrated Monitoring System tests. This last helps us monitor nonmember banks between examinations and gives us indications when a bank is beginning to experience difficulties. Hardcopy IMS reports which facilitate in-depth bank analysis are available on a quarterly basis. Five States now receive them: Alaska, Florida, Michigan, New York, and Virginia. The State banking department can also obtain the same information for all its State member banks if the department obtains approval from its Federal Reserve Bank. Forty States receive the FD IC’s comparative perfor mance reports, which provide bank group ratings based on size and other characteristics. The data base can also serve as useful background material to help a State examiner prepare for an exam ination. The data base also helps the State in ongoing monitoring of banks and in spotting potential prob lems. The FDIC will train participating State examiners in the use of the computer equipment and in financial analysis techniques that take advantage of information from the computer. B A N K E R S ' ROLE I have gone into some detail about these actions of the FDIC and State regulators that will have important effects on you as bankers. Bankers have probably the biggest stake in this effort. And you have a crucial role in making it work. I have sought to give you a better understanding of our pro gram and the reasons for it. Quite simply, we are striving to find ways to better meet the challenge of bank supervision in the 1980’s. I ask your support and assistance.
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