FDIC TE Test 000 – Questions With Objective Solutions
What are the mandatory provisions under Section 38 applicable to
Undercapitalized banks? Correct Answer - Immediately after receiving
notice (or deemed to have notice) [Call Report, receipt of ROE, written FDIC
notice] bank is subject to Sec 38 of FDI Act:
-restricting capital distributions and management fees
-requires FDIC to monitor condition of bank
-requires submission of a Capital Restoration Plan
-restrict asset growth of bank
-prior approval required for acquisitions, branching, and new lines of business
324.405(a)(2)
What does the ROCA rating system rate? Correct Answer - Risk
Management
Operational Controls
Compliance
Asset Quality
If a lease meets one or more of what 4 criteria to be accounted Capitalized
Lease? Correct Answer - Ownership of property transferred to lessee @
end of lease term
Lease term contains bargain purchase option
Lease term represents at least 75% of est. economic life of asset
PV of minimum lease payments at beginning of lease is 90% or more of the FV
of the leased property to lessor less any related investment tax credit
expected to be realized by lessor.
How should a capitalized lease be reported on the Call Report Correct
Answer - Reported in P&FA @ PV of the minimum req. lease payments
over the non-cancellable term & PV of BPO payment less portion of payments
, for admin expense. Property amortized according to bank's (lessee's) normal
depreciation policy.
What are the 5 methods of accounting for dispositions of ORE? (ASC 360)
Correct Answer - Full accrual
Installment
Cost Recovery
Reduced Profit
Deposit Method
What defines a full-scope exam? Correct Answer - Procedures necessary
to complete mandatory ROE pages + evaluate all components of the
UFIRS/CAMELS ratings
All exam activities are considered in the overall assessment of the bank
including:
Risk mgmt, IT, BSA/AML, OFAC, Trust, Registered transfer agent, muni
securities dealer, gov't securities dealer, as applicable
What are the mandatory ROE pages? Correct Answer - Cover Page
Table of Contents
ECC
ITA
EDR
Signatures of Directors
Ratings Definitions
Confidential.
Required when applicable:
MRBA
Compliance with Enforcement Actions
Violations of Laws & Regulations
Concentrations
Completed but not in ROE
Officers Questionnaire
Directors/Trustees and Officers
What are the mandatory provisions under Section 38 applicable to
Undercapitalized banks? Correct Answer - Immediately after receiving
notice (or deemed to have notice) [Call Report, receipt of ROE, written FDIC
notice] bank is subject to Sec 38 of FDI Act:
-restricting capital distributions and management fees
-requires FDIC to monitor condition of bank
-requires submission of a Capital Restoration Plan
-restrict asset growth of bank
-prior approval required for acquisitions, branching, and new lines of business
324.405(a)(2)
What does the ROCA rating system rate? Correct Answer - Risk
Management
Operational Controls
Compliance
Asset Quality
If a lease meets one or more of what 4 criteria to be accounted Capitalized
Lease? Correct Answer - Ownership of property transferred to lessee @
end of lease term
Lease term contains bargain purchase option
Lease term represents at least 75% of est. economic life of asset
PV of minimum lease payments at beginning of lease is 90% or more of the FV
of the leased property to lessor less any related investment tax credit
expected to be realized by lessor.
How should a capitalized lease be reported on the Call Report Correct
Answer - Reported in P&FA @ PV of the minimum req. lease payments
over the non-cancellable term & PV of BPO payment less portion of payments
, for admin expense. Property amortized according to bank's (lessee's) normal
depreciation policy.
What are the 5 methods of accounting for dispositions of ORE? (ASC 360)
Correct Answer - Full accrual
Installment
Cost Recovery
Reduced Profit
Deposit Method
What defines a full-scope exam? Correct Answer - Procedures necessary
to complete mandatory ROE pages + evaluate all components of the
UFIRS/CAMELS ratings
All exam activities are considered in the overall assessment of the bank
including:
Risk mgmt, IT, BSA/AML, OFAC, Trust, Registered transfer agent, muni
securities dealer, gov't securities dealer, as applicable
What are the mandatory ROE pages? Correct Answer - Cover Page
Table of Contents
ECC
ITA
EDR
Signatures of Directors
Ratings Definitions
Confidential.
Required when applicable:
MRBA
Compliance with Enforcement Actions
Violations of Laws & Regulations
Concentrations
Completed but not in ROE
Officers Questionnaire
Directors/Trustees and Officers
