The FDIC issued Financial Institution Letter 01-2009, which states that state nonmember banks should implement a process to monitor their use of capital injections, liquidity support and financing guarantees obtained through the recent financial stability programs established by the Treasury, the FDIC and the FRB. The monitoring processes should help to determine how participation in these federal programs has assisted such institutions in supporting prudent lending or supporting efforts to work with existing borrowers to avoid unnecessary foreclosures. The FDIC encouraged institutions to include a summary of this information in shareholder and public reports, annual reports and financial statements. State nonmember banks should also describe their utilization of federal funding during bank examinations.
Alert January 13, 2009