Responsibilities of the Federal Banking Agencies
The Federal Reserve shares supervisory and regulatory responsibilities
for domestic banking institutions with the Office of the Comptroller of the
Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the Office
of Thrift Supervision (OTS) at the federal level, and with the banking
departments of the various states. The primary supervisor of a domestic banking
institution is generally determined by the type of institution that it is and
the governmental authority that granted it permission to commence business
(commonly referred to as a charter). Banks that are chartered by a state
government are referred to as state banks; banks that are chartered by the OCC,
which is a bureau of the Department of the Treasury, are referred to as
national banks.
The Federal Reserve has primary supervisory authority for state banks
that elect to become members of the Federal Reserve System (state member banks).
State banks that are not members of the Federal Reserve System (state nonmember
banks) are supervised by the FDIC. In addition to being supervised by the
Federal Reserve or FDIC, all state banks are supervised by their chartering
state. The OCC supervises national banks. All national banks must become members
of the Federal Reserve System. This dual federal–state banking system has
evolved partly out of the complexity of the
Banks are often owned or controlled by another company. These
companies are referred to as bank holding companies. The Federal Reserve has
supervisory authority for all bank holding companies, regardless of whether the
subsidiary bank of the holding company is a national bank, state member bank, or
state nonmember bank.
Savings associations, another type of depository institution, have
historically focused on residential mortgage lending. The OTS, which is a
bureau of the Department of the Treasury, charters and supervises federal
savings associations and also supervises companies that own or control a savings
association. These companies are referred to as thrift holding companies.
The FDIC insures the deposits of banks and savings associations up to
certain limits established by law. As the insurer, the FDIC has special
examination authority to determine the condition of an insured bank or savings
association for insurance purposes.