Magazine article American Banker

Try Being Nice to Bank Examiners

Magazine article American Banker

Try Being Nice to Bank Examiners

Article excerpt

A correspondent who wants anonymity (for obvious reasons) brings up this issue:

"Every time the examiners come in, the whole bank is disrupted until they leave. How can we get them out of our shop faster?"

One response to this question, which I reported in this newspaper several years back, was: "Make conditions uncomfortable enough so they don't want to stay."

At that time, I quoted a banker who told me that when his bank replaced comfortable chairs with straight-backed ones, the exam went faster. And when the bank removed the chairs from the boardroom altogether, the exam went even faster.

Uncomfortable and Fast

The Wall Street Journal picked up my column and presented its ideas. The newspaper then printed a letter from a banker who said that when his bank moved the examiners to a facility where there was no convenient toilet, the exam went like lightning.

But I did not think this advice would be enough for our readers - even though it does have merit.

Attempting to come up with more tips, I called a friend in the legal department of a stable banking department. This friend admitted that, in some instances, the regulators themselves are so short of space they send a whole team of examiners out for a long stay in a bank - just to have some place for them to sit!

Interesting, but of no help on ways to cut down the time of the exam.

Finally I went to Tom Gray, president and chief executive officer of the $120 million-asset Carnegie Bank in Princeton, N.J. Carnegie is one of the few de novo banks of recent years that has been a real success, earning almost 1% on assets now.

Tom spent six years as an examiner with the Office of the Comptroller of the Currency. His advice was not along the lines of making life miserable for the examiners.

"We treat the examiners with empathy and respect," said Tom. "When they come in, we are ready for them. …

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