Footnote 2: The Chairman’s question grew up into the context of an incoming letter from a wide range of customer advocacy teams. This page, as well as comparable communication in ’09, indicated concern that RALs harmed consumers. End of footnote

Footnote 2: The Chairman’s question grew up into the context of an incoming letter from a wide range of customer advocacy teams. This page, as well as comparable communication in ’09, indicated concern that RALs harmed consumers. End of footnote

RALs had been, and stay, appropriate tasks, but fundamentally were seen by the FDIC as dangerous towards the banking institutions and possibly bad for customers.

3 As talked about inside our report, the FDIC’s articulated rationale for needing banking institutions to leave RALs morphed in the long run. The choice to cause banks that are FDIC-supervised leave RALs was implemented by specific Division Directors, the Chicago Regional Director, and their subordinates, and sustained by each one of the FDIC’s Inside Directors. The foundation with this choice had not been completely clear since the FDIC decided to go with never to issue formal help with RALs, using more generic guidance relevant to wider aspects of supervisory concern. Yet the decision set in place a number of interrelated activities impacting three organizations that involved aggressive and unprecedented efforts to utilize the FDIC’s supervisory and enforcement capabilities, circumvention of specific settings surrounding the workout of enforcement energy, problems for the morale of specific industry assessment staff, and high expenses towards the three affected institutions.

Footnote 3: The FDIC’s present and historic policy is the fact that it won’t criticize, discourage, or prohibit banking institutions that have appropriate settings set up from doing business with clients who are running in keeping with federal and state legislation. Continue reading