Magazine article American Banker

Merger Wave Testing OCC's Reforms in Bank Oversight

Magazine article American Banker

Merger Wave Testing OCC's Reforms in Bank Oversight

Article excerpt

One year after the Office of the Comptroller of the Currency reorganized its oversight of large national banks, the agency's examiners are facing their biggest test.

The recent wave of huge mergers has put the agency's three deputy comptrollers in charge of large-bank supervision under intense pressure to make sure the deals are pulled off smoothly, with no major mishaps that could shake confidence in the banking system.

"There are a number of things that can blow up," said Douglas W. Roeder, a deputy comptroller assigned in May 1997 to coordinate supervision of the 33 largest national banks.

"If companies lose a grip on their combined operations," he said, "they could see thousands of customers flee and suffer permanent damage in terms of lost business."

Rounding out the trio are Delora Ng Jee and Timothy W. Long. Each has spent a decade or more in the agency's exam force, serving as examiner-in- charge at such institutions as Chase Manhattan Bank, NationsBank, and Fleet National Bank.

The OCC shifted supervision of the top institutions to Washington from six district offices to ensure more consistent oversight.

"The structure the agency has in place was designed with the mergers taking place today in mind," said Mr. Long. "There's nothing we can't handle."

Ms. Jee said centralizing supervision of large banks has made it easier for the trio to recognize potential problems. "Regional supervisors might not have communicated regularly when supervision was divided among six geographic districts," she said. "Now the three of us are constantly talking to each other, and we each are talking daily with examiners in every part of the country."

Each deputy comptroller's stable of banks includes one or two with major mergers under way. Ms. Jee oversees Citibank, whose parent Citicorp is joining with Travelers Group, and Bank of America, whose parent BankAmerica Corp. …

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