State-chartered banks regulated by the Federal
Reserve Board will be examined more frequently as part of changes
announced Tu esday to strengthen bank supervision.
The new policies will apply to three Oklahoma bank holding
companies and 22 Oklahoma state-chartered banks that are regulated by
the Federal Reserve.
In contrast to the new Federal Reserve policy to examine
state-chartered member banks once a year, some Oklahoma banks will
still be scrutinized by regulators at a rate of once every 2 1/2
years, Oklahoma Bank Commissioner Robert Y. Empie said Tuesday.
If they haven't been deemed "problem banks" by the Oklahoma State
Banking Department, 290 of Oklahoma's 312 state-chartered banks are
examined once every two and a half years, he said. "We need more
money to do the job Oklahoma thinks we should be doing," he said,
adding that the department needs "at least 20 more than the 48 total
staff currently funded for" by the Oklahoma Legislature. That staff
includes 37 examiners and 11 administrative staff members.
Of 312 state-chartered Oklahoma banks, 290 are not members of the
Federal Reserve. Those institutions are examined by the state
banking department and the Federal Deposit Insurance Corp.
Oklahoma also has 237 national banks, which are examined by the
office of the Comptroller of the Currency.
Under the new Federal Reserve policy, the state-chartered banks
will be examined every year instead of every 18 months. The 32
largest U.S. bank holding companies, those with more than $10 billion
in assets, will be examined twice a year. Bank holding companies
with more than $1 billion in assets will be examined at least every
12 months, depending on complexity and financial condition of
theorganization, according to James M. Harvey, supervisor of the
monitoring section of the division of bank supervision and structure
for the Federal Reserve Bank in Kansas City.
The Federal Reserve makes an effort to coordinate holding company
inspections with examinations of the lead bank by the Office of the
Comptroller of the Currency, Harvey said. Mid-year 1985 figures show
three Oklahoma bank holding companies have assets in excess of $1
billion: Banks of MidAmerica Inc. of Oklahoma City - $3.5 billion;
BancOklahoma Corp. of Tulsa - $2.9 billion; and First Oklahoma
Bancorporation of Oklahoma City - $2.6 billion.
The Federal Reserve said steps were being taken to aid in the
early identification of problems in banking organizations through
more frequent and in-depth, on-site examinations.
A new summary letter to a bank's board of directors, highlighting
the exceptions found by examiners, will accompany Federal Reserve
examination reports beginning in January 1986, said Tom Hoenig, vice
president of the Federal Reserve Bank in Kansas City.
The letter will itemize "clearly and concisely" specific problems
found by examiners that are incorporated in the larger examination
report, Hoenig said. Rather than simply reviewing and acknowledging
the examination report as they have in the past, directors will now
be required by the Federal Reserve to respond in detail with
corrective actions they intend to take.
"We will not be sidestepping bank management," Hoenig said, "but
we will be working with management and directors to insure that the
directors are holding the management accountable and becoming
Banks have complained in the past, he said, that examination
reports are not specific enough and fail to require specific
corrective action by management and directors. …