FDIC TE Set 400 – Questions With Accurate Solutions
What 5 criteria does a bank have to meet to be eligible for expedited
application processing?
Part 303.2 Correct Answer - Composite 1 or 2
CRA rating satisfactory or better
Compliance rating of 1 or 2
Well Capitalized
Not subject to ANY written agreement
IAP (Institution Affiliated Party) Restrictions - Section 19 Correct Answer -
Section 19 prevents without prior FDIC consent a person convicted of (or
pretrial diversion of) crime involving:
dishonesty
breach of trust
money laundering
From becoming or continuing as IAP, owning/controlling a bank or otherwise
participating in bank affairs.
Application to continue to serve not required for if all:
Only one conviction for covered offense
offence did not involve bank/CU
Punishable by 1 yr or less jail and or fine <$1M and no time served
Conviction at least 5 years prior
Writing bad checks will be included if total amount of checks was $1M or less
and no bank was payee
Section 8(e) action may be taken only when it is determined after notice and
hearing that: Correct Answer - 1. The IAP has violated any law or
regulation, any final C&D orer, any condition imposed in writing for
application, any written agreement, participated in any unsafe and unsound
practice OR breached fiduciary duty AND
2. by reason of above, IDI has or will probably suffer financial loss, interests of
depositors prejudiced OR party has received financial gain/benefit AND
3. violation involves personal dishonesty on the part of IAP or demonstrates
willful or continuing disregard for S&S of institution.
, Call Report Fines Correct Answer - Tier 1 - $519/day for first 15 days
late, $1,039/day 16+.
For banks <$25MM $173/day to $346M or 1/500th of TA
Increase @ 2nd offense in 5 preceding quarters
865 for 1st 15 days, $1,731/day. <$250M 1/500th then 1/250th
False or misleading - Tier 1 - not more than $3,787/day
Tier 2 - $37,872/day
Tier 3 lesser of $1,893,610 or 1% of TA/day
CMP recommendations should only be initiated when the finable violation is
believed ot meet the test of gravity, incl consideration of the 12 factors, and
the existence of any one of the following criteria: Correct Answer - The
violations causes the bank to suffer substantial financial loss
The violations are will, flagrant, or otherwise evidence bad faith on the part of
bank/individual
The violation directly or indirectly involves an insider or assoc. of insider who
benefits from transaction in a material or substantial way
Previous supervisory means have not been effective in eliminating or
deterring violations
What banks meet the definition of Troubled Condition (Part 303) Correct
Answer - ONE of the following
1. Composite 4 or 5 (or equivalent foreign)
2. Subject to FDIC proceeding for termination or suspension of deposit
insurance.
3. C&D order or written agreement (FDIC or State) requiring improvement to
financial condition.
4. In informed in writing that they are troubled based on CR, ROE, or other
info.
What 5 filings take into account the bank's CRA record of performance
Correct Answer - Establishment of domestic branch
Relocation of main office or domestic branch
Relocation of insured branch of foreign bank
What 5 criteria does a bank have to meet to be eligible for expedited
application processing?
Part 303.2 Correct Answer - Composite 1 or 2
CRA rating satisfactory or better
Compliance rating of 1 or 2
Well Capitalized
Not subject to ANY written agreement
IAP (Institution Affiliated Party) Restrictions - Section 19 Correct Answer -
Section 19 prevents without prior FDIC consent a person convicted of (or
pretrial diversion of) crime involving:
dishonesty
breach of trust
money laundering
From becoming or continuing as IAP, owning/controlling a bank or otherwise
participating in bank affairs.
Application to continue to serve not required for if all:
Only one conviction for covered offense
offence did not involve bank/CU
Punishable by 1 yr or less jail and or fine <$1M and no time served
Conviction at least 5 years prior
Writing bad checks will be included if total amount of checks was $1M or less
and no bank was payee
Section 8(e) action may be taken only when it is determined after notice and
hearing that: Correct Answer - 1. The IAP has violated any law or
regulation, any final C&D orer, any condition imposed in writing for
application, any written agreement, participated in any unsafe and unsound
practice OR breached fiduciary duty AND
2. by reason of above, IDI has or will probably suffer financial loss, interests of
depositors prejudiced OR party has received financial gain/benefit AND
3. violation involves personal dishonesty on the part of IAP or demonstrates
willful or continuing disregard for S&S of institution.
, Call Report Fines Correct Answer - Tier 1 - $519/day for first 15 days
late, $1,039/day 16+.
For banks <$25MM $173/day to $346M or 1/500th of TA
Increase @ 2nd offense in 5 preceding quarters
865 for 1st 15 days, $1,731/day. <$250M 1/500th then 1/250th
False or misleading - Tier 1 - not more than $3,787/day
Tier 2 - $37,872/day
Tier 3 lesser of $1,893,610 or 1% of TA/day
CMP recommendations should only be initiated when the finable violation is
believed ot meet the test of gravity, incl consideration of the 12 factors, and
the existence of any one of the following criteria: Correct Answer - The
violations causes the bank to suffer substantial financial loss
The violations are will, flagrant, or otherwise evidence bad faith on the part of
bank/individual
The violation directly or indirectly involves an insider or assoc. of insider who
benefits from transaction in a material or substantial way
Previous supervisory means have not been effective in eliminating or
deterring violations
What banks meet the definition of Troubled Condition (Part 303) Correct
Answer - ONE of the following
1. Composite 4 or 5 (or equivalent foreign)
2. Subject to FDIC proceeding for termination or suspension of deposit
insurance.
3. C&D order or written agreement (FDIC or State) requiring improvement to
financial condition.
4. In informed in writing that they are troubled based on CR, ROE, or other
info.
What 5 filings take into account the bank's CRA record of performance
Correct Answer - Establishment of domestic branch
Relocation of main office or domestic branch
Relocation of insured branch of foreign bank
