Coordination and Continuing Education
Coordination with Other Supervisors
Coordination with other domestic and international supervisors is critical to ensuring effective, consolidated supervision of all domestic and foreign operations of each LISCC firm. Coordination can take the form of joint supervisory planning, joint examinations, and information sharing. Regular supervisory coordination during benign times facilitates supervisory cooperation during periods of stress.
The LISCC Program coordinates closely with other domestic supervisors. LISCC Program members meet regularly with the other federal banking supervisors, the OCC and FDIC, to share supervisory strategies, and all three agencies work to coordinate examination activities. The agencies also share information on supervisory findings, ratings, and emerging areas of common concern. When a functional regulator oversees a significant entity within a LISCC firm, the DST and LISCC portfolio program team members coordinate with the supervisory teams from the functional regulators (the OCC, FDIC, and SEC). If a LISCC firm has a state member bank, the DST will meet on a periodic basis with state regulators that have joint supervisory responsibility for state member banks.
Coordination with foreign supervisors is conducted through several forums:
- Supervisory colleges are the primary forum for collaboration, coordination, and information-sharing among home and host supervisory authorities on the risks and vulnerabilities of firms that operate in different countries. Supervisory colleges provide a framework for home and host supervisors to address key topics related to the supervision of a cross-border firm.
- Crisis management groups enable home and host supervisors and resolution authorities to prepare for a cross-border crisis affecting a firm and to facilitate the firm's orderly resolution.19
- Outside of formal supervisory colleges and crisis management groups, LISCC staff also meet regularly with foreign supervisors to discuss supervisory issues and policy. These meetings also promote agency-to-agency information sharing and common understanding of supervisory programs as well as cooperation in supervisory work.
LISCC Program Workforce
Examiner Qualifications/Commissioning
LISCC Program examination staff and leadership are held to high learning expectations that follow Federal Reserve System standards. These standards promote consistency and effectiveness in the execution of supervision across the LISCC Program.
The Federal Reserve has a comprehensive supervisory education framework, which includes the Large Financial Institutions Examiner Commissioning Program (LFI ECP).20 The LFI ECP curriculum is designed to provide a broad perspective with respect to LFI supervisory expectations, requirements, and practices. The curriculum includes online, classroom, and on-the-job training requirements. The curriculum culminates with a proficiency examination leading to a formal examiner commission.
In addition, the Federal Reserve's learning program includes a Continuing Professional Development (CPD) program. The CPD program provides supervision staff opportunities to maintain job knowledge, develop new skills, and expand knowledge into specialized areas.
Conflicts of Interest
LISCC Program supervisory staff are subject to conflicts of interest rules and examiner credentialing requirements, as well as to each Federal Reserve Bank's Code of Conduct (applicable to employees of that Reserve Bank).21 Stated generally, these rules provide that staff may not participate in a supervisory matter or examination of an institution if the staff member has a relationship or financial interest that might result in a conflict of interest or the appearance of a conflict of interest. Relationships that may create a conflict of interest include, but are not limited to, investments, borrowings, prior employment, and employment of family members.22
Staff must have an examiner credential to examine or inspect an institution. A credential, approved and issued by the Board, enables staff to participate as an examiner in an examination or inspection of an institution in accordance with the credential and subject to borrowing and conflicts of interest restrictions.23
Footnotes
19. See Financial Stability Board, "Key Attributes of Effective Resolution Regimes for Financial Institutions," October 2014, at https://www.fsb.org/2014/10/key-attributes-of-effective-resolution-regimes-for-financial-institutions-2/. Return to text
20. For more information on LFI-ECP, see SR 17-6/CA 17-1, "Overview of the Federal Reserve's Supervisory Education Programs," at https://www.federalreserve.gov/supervisionreg/srletters/sr1706.htm. Return to text
21. These conflicts of interest rules and examiner credentialing requirements supplement the standards contained in 18 U.S.C. § 208, federal ethics regulations (applicable to Board staff) in 5 C.F.R. parts 2635 and 2640. Return to text
22. See 18 U.S.C. §213 and the policy at Federal Reserve Administrative Manual 5-041, "Investment Policy, Borrowing Prohibitions, Recusal from Examinations and Inspections," https://www.federalreserve.gov/boarddocs/srletters/2005/sr0502a1.pdf. Return to text
23. See 18 U.S.C. §213 and Federal Reserve Administrative Manual 5-041. Return to text