1 | Page
FDIC TE Prep Questions and Correct
Answers
What is included in tier 2 capital?— Ans: ALLL up to 1.25%
of risk-weighted assets
qualifying preferred stock
Subordinated debt
Qualifying tier 2 minority interest, less any deductions in
the tier 2 instrument of an unconsolidated financial
institution.
What is the purpose of the FDIC conducting bank
examinations?— Ans: To ensure public confidence in the
banking system and to protect the DIF
What should examiners do before discussing proposed
ratings of a 3 or worse rated bank?— Ans: Contact the
regional office to discuss with the CM or the ARD
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, 2 | Page
Sections 10(b) and 10(c) of the FDI do what?— Ans:
Empower examiners to make thorough examination of the
banks affairs
What is often the single most important factor of a
successful operation of an insured institution?— Ans: The
quality of management
Examination findings, including the composite and
component ratings, are subject to confidentiality under
which regulation/rule?— Ans: Part 309 of the FDIC rules
and regs
When should an examination letter be delivered to the
CEO/President during an exit meeting?— Ans: for any bank
newly assigned a CAMELS composite 3 or worse
Under Section 10(d) of the FDI act, how often must insured
branches of foreign banks be examined?— Ans: every 12
months
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, 3 | Page
Section 347.211 of the FDIC rule and regs states that
domestic branches of foreign banks can be considered for
examination every ___________ months?— Ans: 18 months
Limited scope examinations should be performed how
many months after an enforcement action is issued?— Ans:
6 months
When can examination schedules be extended to 18 months
for a state nonmember bank?— Ans: ~the bank has total
assets of $3 billion or less
~ the bank is well capitalized as defined in 323.403(B)(1) of
FDIC rules and regs
~the ban was assigned a management rating of 1 or 2 at the
last examination
~the ban was assigned a composite rating of 1 or 2 at the
last exam
~the bank is not subject to formal enforcement proceedings
or order by the FDIC, OCC< or FRB
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, 4 | Page
~no person acquired control of the bank during the
preceding 12 months in which the last full-scope
examination was completed
Section 10(D)(9) ofthe FDI act requires what?— Ans: The
FFEIC to issue guidelines establishing standards for the
purpose of determining the acceptability of state reports of
examination.
How much times notice should a bank be given for notice of
an up coming examination and provided enough time to
complete pre-examination request— Ans: 2 weeks
How are shared-loss agreements generally written?— Ans:
With the FDIC absorbing 80% of injured losses (up to a
stated threshold) and receives 80 percent of recoveries
How many years are commercial, shared loss agreements
generally cover how many years for losses and
recoveries?— Ans: 5 years for losses and 8 years for
recoveries
© 2025 All rights reserved
FDIC TE Prep Questions and Correct
Answers
What is included in tier 2 capital?— Ans: ALLL up to 1.25%
of risk-weighted assets
qualifying preferred stock
Subordinated debt
Qualifying tier 2 minority interest, less any deductions in
the tier 2 instrument of an unconsolidated financial
institution.
What is the purpose of the FDIC conducting bank
examinations?— Ans: To ensure public confidence in the
banking system and to protect the DIF
What should examiners do before discussing proposed
ratings of a 3 or worse rated bank?— Ans: Contact the
regional office to discuss with the CM or the ARD
© 2025 All rights reserved
, 2 | Page
Sections 10(b) and 10(c) of the FDI do what?— Ans:
Empower examiners to make thorough examination of the
banks affairs
What is often the single most important factor of a
successful operation of an insured institution?— Ans: The
quality of management
Examination findings, including the composite and
component ratings, are subject to confidentiality under
which regulation/rule?— Ans: Part 309 of the FDIC rules
and regs
When should an examination letter be delivered to the
CEO/President during an exit meeting?— Ans: for any bank
newly assigned a CAMELS composite 3 or worse
Under Section 10(d) of the FDI act, how often must insured
branches of foreign banks be examined?— Ans: every 12
months
© 2025 All rights reserved
, 3 | Page
Section 347.211 of the FDIC rule and regs states that
domestic branches of foreign banks can be considered for
examination every ___________ months?— Ans: 18 months
Limited scope examinations should be performed how
many months after an enforcement action is issued?— Ans:
6 months
When can examination schedules be extended to 18 months
for a state nonmember bank?— Ans: ~the bank has total
assets of $3 billion or less
~ the bank is well capitalized as defined in 323.403(B)(1) of
FDIC rules and regs
~the ban was assigned a management rating of 1 or 2 at the
last examination
~the ban was assigned a composite rating of 1 or 2 at the
last exam
~the bank is not subject to formal enforcement proceedings
or order by the FDIC, OCC< or FRB
© 2025 All rights reserved
, 4 | Page
~no person acquired control of the bank during the
preceding 12 months in which the last full-scope
examination was completed
Section 10(D)(9) ofthe FDI act requires what?— Ans: The
FFEIC to issue guidelines establishing standards for the
purpose of determining the acceptability of state reports of
examination.
How much times notice should a bank be given for notice of
an up coming examination and provided enough time to
complete pre-examination request— Ans: 2 weeks
How are shared-loss agreements generally written?— Ans:
With the FDIC absorbing 80% of injured losses (up to a
stated threshold) and receives 80 percent of recoveries
How many years are commercial, shared loss agreements
generally cover how many years for losses and
recoveries?— Ans: 5 years for losses and 8 years for
recoveries
© 2025 All rights reserved
