I do so dearly wish that your Management's oral response had been "We will review the guidance document if and when it is issued in final form, and will then determine what action to take."

But, of course, I'm not your management, I don't wear their shoes, and I didn't "live" the exam.

This 'consent' was something new for me in my last compliance exam. While there were no citations and virtually no findings, they had a couple recommendations that they wanted management to 'consent' to. We used to respond that we would take their recommendations under consideration, but that was not good enough for them this time. They wanted an affirmative consent that bank management was going to do what they recommended. They made it obvious that they weren't going to take anything other than an affirmative since they kep asking did management agree with the recommendation. Since the recommendations were 'picky' my management agreed. I told them after the meeting that I would not have agreed in that exit meeting to anything other than we'd take it under consideration. This was the FDIC.

PERSONAL OPINION:

I like the FDIC when it sticks to its knitting. But when it starts trying to shape bank products and pricing, treating consumers as if they are ALL total idiots and victims, and allowing its examiners to create de facto compliance rules out of whole cloth, I question its motives and mission.

Unfortunately, it seems that bank management teams are so whip-lashed by new regulations, real estate fraud losses and negative press that some of them don't have the backbone to "Just say no" to unreasonable or unfounded examiner recommendations.

I wanted to "second" Georgia Plum's comments. We recently had an FDIC compliance visitation and we too were asked to consent or agree to their recommendations in the exit meeting as well as give them a timeframe of when we would do it. Even though these weren't violations or findings, simply recommendations. It puts the bank in a tough situation because you're being asked to agree to something that you haven't fully looked into and may not want to pursue.

Yup. Us too. they gave us a sheet of paper with their recommendations, after the recommendation was a line: "Management's response:"
And they asked if we agreed with their recommendation, and what was our timeline to complete. Ex: 15 days, 30 days, Before the end of the quarter...

It's not like we were under a MOU or C&D -- you are asking me to tweak things...

The final guidance does say you have until July 1, 2011 to get things together.

If I understand you correctly, your comment isn't just focused on the "guidance," but your entire compliance program. If yours was the only comment to this effect, I would assume it was an individual examiner who was a bit of a bully. As it's reiterated by a couple subsequent posters, I think this may reflect a change in the FDIC's approach to the examination process. As suggested elsewhere, it may be an attempt to look a little "tougher" on compliance in anticipation of the new agency.

Other bankers might do well to anticipate this in their exit conferences...

That's correct, Ken. This was a compliance exam and there were no findings or cites, only recommendations. Each time we tried to verbally respond in the exit meeting with we'll take your recommendations into consideration, they responded with "does management agree with these recommendations?" They made it clear that there was no option to respond differently.

That's correct, Ken. This was a compliance exam and there were no findings or cites, only recommendations. Each time we tried to verbally respond in the exit meeting with we'll take your recommendations into consideration, they responded with "does management agree with these recommendations?" They made it clear that there was no option to respond differently.

One wonders how they would have accepted a "No!" response.

My response to the examiners is that I was not going to agree either verbally or in writing to any recommendations made by a specific examiner that were not reduced to writing of which the bank receives a copy. Doing so is not in the best interests of the bank. If the examiner continued to insist, I would tell them that you would like to reschedule the exit conference until after the Bank could contact the ombudsman. This might put the examiner in a box, but the field office would eventually get involved and stop this practice or require that this things be documented in writing (more than just notes in the examination file of which the bank has no control).

We had a copy of their recommendations. One of ours explained that our responses went with their report and were reviewed as a part of their overall exam review process - that's why they have to have timelines, and a specific response. If we didn't consent to what their recommendations were I supposed that they would have downgraded our exam scores.