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Summary and Comments

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Category: 

Banking

Date: 

1998-02-20 00:15:41

Subject: 

FDIC Must Audit 40 Banks a Day

Comment: 

How can the FDIC (noncompliant) investigate 4,000 banks (noncompliant) by June, 1998? It can't. But it can fake it well enough to placate most Congressmen, who are in y2k denial and who have to worry about the 1998 Congresssional elections.

This is from AMERICAN BANKER (Feb. 19).

* * * * * * *

The Federal Deposit Insurance Corp. has less than 100 business days to examine how more than 4,000 banks are handling the year-2000 problem. That's at least 40 banks a day.

What's worse, FDIC examiners must return to the more than 2,000 banks already evaluated because the General Accounting Office found the agency's first reviews inadequate.

Michael J. Zamorski, deputy director of the FDIC's supervision division and head of its year-2000 task force, says the agency's specially trained examiners will meet their June 30 deadline.

"Even though we have 6,200 institutions, they tend to be smaller and much simpler organizations than the larger, complex organizations" that the Office of the Comptroller of the Currency and the Federal Reserve Board oversee, said Mr. Zamorski.

But FDIC's examiners will have to pick up the pace. The agency is just one-third of the way through its exams.

By comparison, the Comptroller's Office and the Federal Reserve have completed about half their year-2000 exams. . . .

GAO is not alone in fretting over the year-2000 exams. "Many examiners don't completely understand the issue and need more training," said a bank consultant.

But the FDIC's Zamorski countered that his examiners are well-seasoned, with an average tenure of 12 years. . . .


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