Preserving Minority Depository Institutions, 2013

The Board submits this report pursuant to section 367 of the Dodd-Frank Act. This section requires the Board to submit an annual report to the Congress detailing the actions taken to fulfill requirements outlined in section 308 of the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) of 1989, as amended by the Dodd-Frank Act. In addition to the annual reporting requirement, FIRREA section 308 requires the Federal Reserve System (System) to devote efforts towards preserving minority ownership of minority depository institutions (MDIs). Comments on the System’s efforts to fulfill the requirements of FIRREA section 308 are included in the 2008 through 2012 annual reports of the Board to the Congress. However, this report is issued in separate form to align Board practice with that of the other agencies with section 367 responsibilities. Throughout 2013, the System supervised 17MDIs, which collectively represented 2.06 percent of the 825 community banks in the System’s community banking organizations portfolio. To support these institutions and to accomplish minority depository-related FIRREA goals, the System continues to dedicate resources to engage in outreach and technical assistance activities. Throughout 2013, staff from the Board as well as staff from each of the 12 Federal Reserve Banks (FRBs) engaged in activities to support MDIs. Highlights of those activities include issuance of Supervision and Regulation letter 13-15, “Federal Reserve Resources for Minority Depository Institutions,” to reaffirm the System’s commitment to support MDIs; collaboration with the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) in holding a biannual interagency conference to help promote and preserve MDIs; participation in the 86th National Bankers Association (NBA) convention, with senior Board officials attending to explain the impact of Basel III capital rules on community banking organizations; technical assistance to MDIs on a wide variety of topics, including topics focused on improving regulatory ratings, navigating the regulatory applications process, and refining capital-planning practices; and maintenance of a public website, which offers a full menu of banking resources and regulatory guidance relevant to MDIs.