    Financial Audit: Federal Deposit Insurance Corporation's 1995 and 1994
    Financial Statements (Letter Report, 07/15/96, GAO/AIMD-96-89).

    GAO audited the 1995 and 1994 financial statements for three funds
    administered by the Federal Deposit Insurance Corporation (FDIC), the
    Bank Insurance Fund (BIF), the Savings Association Insurance Fund
    (SAIF), and the Federal Savings and Loan Insurance Corporation (FSLIC)
    Resolution Fund. GAO found that the financial statements of each fund,
    taken as a whole, were reliable in all material respects. Although some
    internal controls should be improved, FDIC management fairly stated that
    its internal controls effectively safeguarded assets from material loss,
    ensured compliance with laws and regulations, and ensured that there
    were no material misstatements in the financial statements of the three
    funds. There was no reportable noncompliance with laws and regulations.
    FDIC has addressed several internal control weaknesses GAO identified in
    its 1994 audits. However, FDIC has not fully addressed GAO's concerns
    regarding weaknesses in documentation maintained to support asset
    recovery estimates. GAO's 1995 audits found continued weaknesses in (1)
    controls over FDIC's process for estimating recoveries from failed
    institution assets, (2) FDIC's time and attendance reporting process,
    and (3) FDIC's electronic data processing controls. This report also
    discusses the recent development of a significant premium rate
    differential between insured institutions of BIF and SAIF as a result of
    BIF attaining its designated capitalization level. GAO discusses the
    impact this premium rate differential may have on the thrift industry's
    ability to finance obligations arising from the thrift crisis of the
    1980s and on future deposit insurance premium rates.

    --------------------------- Indexing Terms -----------------------------

     REPORTNUM:  AIMD-96-89
         TITLE:  Financial Audit: Federal Deposit Insurance Corporation's
                 1995 and 1994 Financial Statements
          DATE:  07/15/96
       SUBJECT:  Bank management
                 Funds management
                 Financial statement audits
                 Federal corporations
                 Internal controls
                 Financial records
                 Accounting procedures
                 Reporting requirements
                 Corporate audits
    IDENTIFIER:  BIF
                 SAIF
                 Bank Insurance Fund
                 Savings Association Insurance Fund
                 FSLIC Resolution Fund

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    Cover
    ================================================================ COVER

    Report to the Congress

    July 1996

    FINANCIAL AUDIT - FEDERAL DEPOSIT
    INSURANCE CORPORATION'S 1995 AND
    1994 FINANCIAL STATEMENTS

    GAO/AIMD-96-89

    FDIC's 1995 and 1994 Financial Statements

    (917705)

    Abbreviations
    =============================================================== ABBREV

      ADM - Asset Disposition Manual
      BIF - Bank Insurance Fund
      CAOG - Contractor Accounting Oversight Group
      CFO - Chief Financial Officers Act
      COMB - Contractor Oversight and Monitoring Branch
      DAS - Division of Depositor and Asset Services
      FDIC - Federal Deposit Insurance Corporation
      FDICIA - Federal Deposit Insurance Corporation Improvement Act
      FICO - Financing Corporation
      FIRREA - Financial Institutions Reform, Recovery, and Enforcement
         Act
      FRF - FSLIC Resolution Fund
      FSLIC - Federal Savings and Loan Insurance Corporation
      RTC - Resolution Trust Corporation
      SAIF - Savings Association Insurance Fund

    Letter
    =============================================================== LETTER

    B-262039

    July 15, 1996

    To the President of the Senate and the
    Speaker of the House of Representatives

    This report presents our opinions on the financial statements of the
    Bank Insurance Fund, the Savings Association Insurance Fund, and the
    Federal Savings and Loan Insurance Corporation (FSLIC) Resolution
    Fund for the years ended December 31, 1995 and 1994.  These financial
    statements are the responsibility of the Federal Deposit Insurance
    Corporation (FDIC), the administrator of the three funds.  This
    report also presents (1) our opinion on FDIC management's assertions
    regarding the effectiveness of its system of internal controls as of
    December 31, 1995, and (2) our evaluation of FDIC's compliance with
    laws and regulations during 1995.  In addition, it discusses FDIC's
    progress in correcting internal control weaknesses and presents our
    recommendations for further improvement.  The report also highlights
    the recent development of a significant premium rate differential
    between the insured institutions of the Bank Insurance Fund and the
    Savings Association Insurance Fund as a result of the Bank Insurance
    Fund attaining its designated capitalization level.  We discuss our
    observations concerning the impact this premium rate differential may
    have on the thrift industry's ability to finance certain obligations
    arising from the thrift crisis of the 1980s and on future deposit
    insurance premium rates.

    We conducted our audits pursuant to the provisions of section 17(d)
    of the Federal Deposit Insurance Act, as amended (12 U.S.C.
    1827(d)), and in accordance with generally accepted government
    auditing standards.

    We are sending copies of this report to the Chairman of the Board of
    Directors of the Federal Deposit Insurance Corporation; the Chairman
    of the Board of Governors of the Federal Reserve System; the
    Comptroller of the Currency; the Acting Director of the Office of
    Thrift Supervision; the Chairmen and Ranking Minority Members of the
    Senate Committee on Banking, Housing and Urban Affairs and the House
    Committee on Banking and Financial Services; the Secretary of the
    Treasury; the Director of the Office of Management and Budget; and
    other interested parties.

    This report was prepared under the direction of Robert W.  Gramling,
    Director, Corporate Audits and Standards.  Other major contributors
    to this report are listed in appendix II.

    Charles A.  Bowsher
    Comptroller General
    of the United States

    Letter
    =============================================================== LETTER

    B-262039

    To the Board of Directors
    Federal Deposit Insurance Corporation

    We have audited the statements of financial position as of December
    31, 1995 and 1994, of the three funds administered by the Federal
    Deposit Insurance Corporation (FDIC), the related statements of
    income and fund balance (accumulated deficit), and statements of cash
    flows for the years then ended.  In our audits of the Bank Insurance
    Fund (BIF), the Savings Association Insurance Fund (SAIF), and the
    Federal Savings and Loan Insurance Corporation (FSLIC) Resolution
    Fund (FRF), we found

      -- the financial statements of each fund, taken as a whole, were
         reliable in all material respects;

      -- although certain internal controls should be improved, FDIC
         management fairly stated that internal controls in place on
         December 31, 1995, were effective in safeguarding assets from
         material loss, assuring compliance with relevant laws and
         regulations, and assuring that there were no material
         misstatements in the financial statements of the three funds
         administered by FDIC; and

      -- no reportable noncompliance with laws and regulations we tested.

    During our audits of the 1994 financial statements of the three
    funds,\1 we identified weaknesses in FDIC's internal controls which,
    while not material, affected its ability to ensure that internal
    control objectives were achieved.  We made a number of
    recommendations to address each of the weaknesses identified in our
    1994 audits.

    In conducting our 1995 audits, we found that FDIC made progress in
    addressing several internal control weaknesses identified in our 1994
    audits.  FDIC's actions during 1995 fully resolved weaknesses we
    identified in controls over safeguarding of assets and proper
    reporting of asset management and disposition activity by contracted
    asset servicing entities.  Also, FDIC made some progress in improving
    controls over its asset valuation process.  However, additional
    improvements are needed, as FDIC has not fully addressed our concerns
    regarding weaknesses in documentation maintained to support asset
    recovery estimates.  Our 1995 audits continued to find weaknesses,
    though not material, in controls over FDIC's process for estimating
    recoveries from failed institution assets.  In our 1995 audits, we
    also continued to find weaknesses in FDIC's time and attendance
    reporting process.  FDIC has initiatives underway to streamline its
    time and attendance process which it believes will address the
    internal control weaknesses we identified.  In addition, during 1995,
    we found a weakness in FDIC's electronic data processing controls
    which, due to its sensitive nature, is being communicated separately
    to FDIC.

    The condition of the nation's banks and savings associations
    continued to improve.  The improved condition of the banking
    industry, and the higher premiums BIF-insured institutions have paid
    in the last several years, resulted in BIF reaching its designated
    capitalization level in 1995.  Consequently, FDIC lowered premium
    rates charged to BIF-insured institutions.  While the improved
    condition of the nation's thrifts and higher premiums have helped
    improve SAIF's condition, a significant premium rate differential
    developed between BIF and SAIF during 1995 and, absent legislative
    action, will likely remain for a number of years.  This significant
    premium rate differential could adversely affect the thrift
    industry's ability to finance certain obligations arising from the
    thrift crisis of the 1980s and could eventually lead to higher
    deposit insurance premium rates.

    The following sections discuss our conclusions in more detail and
    discuss (1) the scope of our audits, (2) significant matters related
    to the condition and outlook of the banking and thrift industries and
    the insurance funds, and what progress the Corporation has made in
    addressing internal control weaknesses identified in prior audits,
    (3) reportable conditions\2 identified in our 1995 audits, (4)
    recommendations from our 1995 audits, and (5) the Corporation's
    comments on a draft of this report and our evaluation.

    --------------------
    \1 Financial Audit:  Federal Deposit Insurance Corporation's 1994 and
    1993 Financial Statements (GAO/AIMD-95-102, March 31, 1995).

    \2 Reportable conditions involve matters coming to the auditor's
    attention relating to significant deficiencies in the design or
    operation of internal controls that, in the auditor's judgment, could
    adversely affect an entity's ability to (1) safeguard assets against
    loss from unauthorized acquisition, use, or disposition, (2) ensure
    the execution of transactions in accordance with management's
    authority and in accordance with laws and regulations, and (3)
    properly record, process, and summarize transactions to permit the
    preparation of financial statements and to maintain accountability
    for assets.  A material weakness is a reportable condition in which
    the design or operation of the internal controls does not reduce to a
    relatively low level the risk that losses, noncompliance, or
    misstatements in amounts that would be material in relation to the
    financial statements may occur and not be detected within a timely
    period by employees in the normal course of their assigned duties.

       OPINION ON FINANCIAL STATEMENTS
    ------------------------------------------------------------ Letter :1

          BANK INSURANCE FUND
    ---------------------------------------------------------- Letter :1.1

    In our opinion, the financial statements and accompanying notes
    present fairly, in all material respects, in conformity with
    generally accepted accounting principles, the Bank Insurance Fund's
    financial position as of December 31, 1995 and 1994, and the results
    of its operations and its cash flows for the years then ended.

    However, misstatements may nevertheless occur in other FDIC-reported
    financial information on BIF as a result of the internal control
    weaknesses summarized above and discussed in detail in a later
    section of this report.

          SAVINGS ASSOCIATION
          INSURANCE FUND
    ---------------------------------------------------------- Letter :1.2

    In our opinion, the financial statements and accompanying notes
    present fairly, in all material respects, in conformity with
    generally accepted accounting principles, the Savings Association
    Insurance Fund's financial position as of December 31, 1995 and 1994,
    and the results of its operations and its cash flows for the years
    then ended.

    However, misstatements may nevertheless occur in other FDIC-reported
    financial information on SAIF as a result of the internal control
    weaknesses summarized above and discussed in detail in a later
    section of this report.

          FSLIC RESOLUTION FUND
    ---------------------------------------------------------- Letter :1.3

    In our opinion, the financial statements and accompanying notes
    present fairly, in all material respects, in conformity with
    generally accepted accounting principles, the FSLIC Resolution Fund's
    financial position as of December 31, 1995 and 1994, and the results
    of its operations and its cash flows for the years then ended.

    However, misstatements may nevertheless occur in other FDIC-reported
    financial information on FRF as a result of the internal control
    weaknesses summarized above and discussed in detail in a later
    section of this report.

    On January 1, 1996, FRF assumed responsibility for liquidating the
    assets and satisfying the obligations of the Resolution Trust
    Corporation (RTC).\3 As discussed in note 1 of FRF's financial
    statements,\4 proceeds from the management and disposition of RTC's
    assets will be used to satisfy the transferred obligations.  Any
    additional proceeds after satisfaction of RTC's obligations will be
    transferred to the Resolution Funding Corporation.\5

    As discussed in note 8 of FRF's financial statements, there are
    approximately 120 pending lawsuits which stem from legislation that
    resulted in the elimination of supervisory goodwill and other
    forbearances from regulatory capital.  These lawsuits assert various
    legal claims including breach of contract or an uncompensated taking
    of property resulting from the FIRREA provisions regarding minimum
    capital requirements for thrifts and limitations as to the use of
    supervisory goodwill to meet minimum capital requirements.  One case
    has resulted in a final judgment of $6 million against FDIC, which
    was paid by FRF.

    On July 1, 1996, the United States Supreme Court concluded that the
    government is liable for damages in three other cases, consolidated
    for appeal to the Supreme Court, in which the changes in regulatory
    treatment required by FIRREA led the government to not honor its
    contractual obligations.  However, because the lower courts had not
    determined the appropriate measure or amount of damages, the Supreme
    Court returned the cases to the Court of Federal Claims for further
    proceedings.  Until the amount of damages are determined by the
    court, the amount of additional costs from these three cases is
    uncertain.  Further, with respect to the other pending cases, the
    outcome of each case and the amount of any possible damages will
    depend on the facts and circumstances, including the wording of
    agreements between thrift regulators and acquirers of troubled
    savings and loan institutions.  Estimates of possible damages suggest
    that the additional costs associated with these claims may be in the
    billions.  The Congressional Budget Office's December 1995 update of
    its baseline budget projections increased its projection of future
    outlays for fiscal years 1997 through 2002 by $9 billion for possible
    payments of such claims.

    As mentioned above, the final judgment of $6 million in one case
    against FDIC was paid by FRF.  However, as discussed in note 8 of
    FRF's financial statements, FDIC believes that judgments in such
    cases are properly paid from the Judgment Fund.\6 The extent to which
    FRF will be the source of paying other judgments in such cases is
    uncertain.

    --------------------
    \3 The Resolution Trust Corporation was created by the Financial
    Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA)
    to manage and resolve all troubled savings institutions that were
    previously insured by FSLIC and for which a conservator or receiver
    was appointed during the period January 1, 1989, through August 8,
    1992.  This period was extended to September 30, 1993, by the
    Resolution Trust Corporation Refinancing, Restructuring, and
    Improvement Act of 1991 and was further extended on December 17,
    1993, to a date not earlier than January 1, 1995, nor later than July
    1, 1995, by the Resolution Trust Corporation Completion Act of 1993
    (RTC Completion Act).  The RTC Completion Act stated that the final
    date would be determined by the Chairperson of the Thrift Depositor
    Protection Oversight Board.  On December 5, 1994, the Chairperson
    made the determination that RTC would continue to resolve failed
    thrift institutions through June 30, 1995.  Finally, the RTC
    Completion Act required RTC to terminate its operations no later than
    December 31, 1995.

    \4 The notes to FRF's financial statements do not present amounts
    associated with the assets and obligations transferred from RTC as
    FDIC management is currently considering the future form of the
    reporting entity (that is, FRF and RTC).

    \5 The Resolution Funding Corporation was established by FIRREA to
    provide funding for RTC through issuance of long-term debt
    securities.  Any proceeds transferred to the Resolution Funding
    Corporation will be used to make interest payments on the long-term
    debt securities.

    \6 The Judgment Fund is a permanent, indefinite appropriation
    established by 31 U.S.C.  Sec.  1304.

       OPINION ON FDIC MANAGEMENT'S
       ASSERTIONS ABOUT THE
       EFFECTIVENESS OF FDIC'S
       INTERNAL CONTROLS
    ------------------------------------------------------------ Letter :2

    For the three funds administered by FDIC, we evaluated FDIC
    management's assertions about the effectiveness of its internal
    controls designed to

      -- safeguard assets against unauthorized acquisition, use, or
         disposition;

      -- assure the execution of transactions in accordance with
         management's authority and with provisions of selected laws and
         regulations that have a direct and material effect on the
         financial statements of the three funds; and

      -- properly record, process, and summarize transactions to permit
         the preparation of financial statements in accordance with
         generally accepted accounting principles.

    FDIC management fairly stated that those controls in place on
    December 31, 1995, provided reasonable assurance that losses,
    noncompliance, or misstatements material in relation to the financial
    statements of each of the three funds would be prevented or detected
    on a timely basis.  Management made this assertion based on criteria
    in GAO's Standards for Internal Controls in the Federal Government
    and consistent with the requirements of the Federal Managers'
    Financial Integrity Act of 1982.  However, our work identified the
    need to improve certain internal controls, which were previously
    summarized and are described in detail in a later section of this
    report.  These weaknesses in internal controls, although not
    considered to be material weaknesses, represent significant
    deficiencies in the design or operation of internal controls which
    could adversely affect FDIC's ability to meet the internal control
    objectives listed above.

       COMPLIANCE WITH LAWS AND
       REGULATIONS
    ------------------------------------------------------------ Letter :3

    Our tests for compliance with selected provisions of laws and
    regulations disclosed no instances of noncompliance that would be
    reportable under generally accepted government auditing standards.
    However, the objective of our audits was not to provide an opinion on
    overall compliance with laws and regulations.  Accordingly, we do not
    express such an opinion.

       OBJECTIVES, SCOPE, AND
       METHODOLOGY
    ------------------------------------------------------------ Letter :4

    FDIC management is responsible for

      -- preparing the annual financial statements of BIF, SAIF, and FRF
         in conformity with generally accepted accounting principles;

      -- establishing, maintaining, and assessing the Corporation's
         internal control structure to provide reasonable assurance that
         internal control objectives as described in GAO's Standards for
         Internal Controls in the Federal Government are met; and

      -- complying with applicable laws and regulations.

    We are responsible for obtaining reasonable assurance about whether
    (1) the financial statements of each of the three funds are free of
    material misstatement and are presented fairly, in all material
    respects, in conformity with generally accepted accounting principles
    and (2) FDIC management's assertion about the effectiveness of
    internal controls is fairly stated, in all material respects, based
    upon the control criteria used by FDIC management in making its
    assertion.  We are also responsible for testing compliance with
    selected provisions of laws and regulations and for performing
    limited procedures with respect to certain other information in
    FDIC's annual financial report.

    In order to fulfill our responsibilities as auditor of record for the
    Federal Deposit Insurance Corporation, we

      -- examined, on a test basis, evidence supporting the amounts and
         disclosures in the financial statements of each of the three
         funds;

      -- assessed the accounting principles used and significant
         estimates made by FDIC management;

      -- evaluated the overall presentation of the financial statements
         for each of the three funds;

      -- obtained an understanding of the internal control structure
         related to safeguarding assets, compliance with laws and
         regulations, including the execution of transactions in
         accordance with management's authority, and financial reporting;

      -- tested relevant internal controls over safeguarding, compliance,
         and financial reporting and evaluated management's assertion
         about the effectiveness of internal controls; and

      -- tested compliance with selected provisions of the Federal
         Deposit Insurance Act, as amended; the Chief Financial Officers
         Act; and the Federal Home Loan Bank Act, as amended.

    We did not evaluate all internal controls relevant to operating
    objectives, such as controls relevant to preparing statistical
    reports and ensuring efficient operations.  We limited our internal
    control testing to those controls necessary to achieve the objectives
    outlined in our opinion on management's assertion about the
    effectiveness of internal controls.  Because of inherent limitations
    in any internal control structure, losses, noncompliance, or
    misstatements may nevertheless occur and not be detected.  We also
    caution that projecting our evaluation to future periods is subject
    to the risk that controls may become inadequate because of changes in
    conditions or that the degree of compliance with controls may
    deteriorate.

    We conducted our audits from July 5, 1995, through May 2, 1996.  Our
    audits were conducted in accordance with generally accepted
    government auditing standards.

    FDIC provided comments on a draft of this report.  FDIC's comments
    are discussed and evaluated in a later section of this report and are
    included in appendix I.

       SIGNIFICANT MATTERS
    ------------------------------------------------------------ Letter :5

    The following section is provided to highlight the condition and
    outlook of the banking and thrift industries and the insurance funds.
    In addition, we discuss FDIC's progress in addressing internal
    control weaknesses identified during our previous audits.

          CONDITION OF FDIC-INSURED
          INSTITUTIONS SHOWED
          CONTINUED IMPROVEMENT IN
          1995
    ---------------------------------------------------------- Letter :5.1

    During 1995, the banking and thrift industries continued their strong
    performances.\7 Commercial banks reported record profits of $48.8
    billion in 1995, marking the fourth consecutive year of record
    earnings.  The main source of earnings in 1995 was higher net
    interest income.  The increase in net interest income was
    attributable to growth in interest-bearing assets, even though net
    interest margins declined for a second consecutive year.  During
    1995, commercial banks' return on assets was 1.17 percent, the third
    consecutive year that the industry return on assets has exceeded 1
    percent.

    The strong performance of banks was also reflected in the continued
    reduction in the number of banks identified as problem institutions.
    As of December 31, 1995, 144 commercial banks with total assets of
    $17 billion were identified by FDIC as problem institutions.  This
    represented an improvement over 1994, when 247 commercial banks with
    total assets of $33 billion were identified as problem institutions.
    Six commercial banks failed in 1995, the fewest number of failures in
    any year since 1977.

    Savings institutions reported record earnings of $7.6 billion in
    1995, up from the $6.4 billion earned in 1994.  Thrifts experienced
    an increase in net interest margins in the fourth quarter 1995, the
    first such increase since 1993.  In addition, the thrift industry's
    annual return on assets rose to 0.78 percent, the highest since 1962.
    The industry's improved performance was also reflected in the
    reduction in the number of troubled institutions.  As of December 31,
    1995, regulators identified 49 savings institutions with total assets
    of $14 billion as problem institutions.  This was a significant
    improvement over 1994, when 71 institutions with total assets of $39
    billion were identified as problem institutions.  In 1995, only two
    savings institutions failed.

    --------------------
    \7 The information in this section of the report was obtained from
    The FDIC Quarterly Banking Profile, Fourth Quarter 1995, compiled by
    FDIC's Division of Research and Statistics from quarterly financial
    reports submitted by federally insured depository institutions.
    Thus, we did not audit this information; however, we believe it is
    consistent with other audited information.

          A SIGNIFICANT PREMIUM RATE
          DIFFERENTIAL BETWEEN BANKS
          AND THRIFTS DEVELOPED IN
          1995
    ---------------------------------------------------------- Letter :5.2

    The strengthened condition of the banking industry, coupled with the
    relatively high insurance premiums that banks paid between 1991 and
    1995, resulted in an accelerated rebuilding of BIF's reserves.  BIF
    reached its designated reserve ratio of 1.25 percent of estimated
    insured deposits in May 1995.  Consequently, FDIC's Board of
    Directors significantly reduced the risk-based premium rates charged
    to BIF-insured institutions, and, in September 1995, refunded
    assessment overpayments from the month following the month BIF
    recapitalized, or from June 1995 through September 1995, after FDIC
    confirmed that BIF had achieved its designated reserve ratio.  At
    December 31, 1995, BIF's ratio of reserves to insured deposits
    equaled 1.30 percent.

    Although the thrift industry also experienced significant
    improvements over the past few years, SAIF has not experienced a
    similar increase in its ratio of reserves to insured deposits.  As of
    December 31, 1995, SAIF's ratio of reserves to insured deposits
    equaled 0.47 percent, which is still substantially below its
    designated reserve ratio of 1.25 percent.  SAIF's capitalization has
    been slowed because its members' premiums have and continue to be
    used to pay for certain obligations of the thrift crisis, including
    interest on 30-year bonds issued by the Financing Corporation
    (FICO).\8 FDIC estimates that, absent the statutory requirement to
    use premiums for these other obligations, SAIF would have been fully
    capitalized in 1994.  Under current law, FICO has authority to assess
    SAIF-member savings associations to cover its annual interest
    expense, which will continue until the 30-year bonds mature in the
    years 2017 through 2019.  In 1995, FICO's assessment totaled $718
    million, or approximately 42 percent of SAIF's assessment revenue.\9

    As a result of the annual FICO interest payments, the need to
    capitalize SAIF to its designated reserve ratio, and a reduction in
    premium rates for BIF-insured institutions, a significant
    differential in premium rates charged by BIF and SAIF developed in
    1995 and, absent legislative action, will likely remain for many
    years.\10 For example, during 1996, institutions with deposits
    insured by BIF are paying an average of less than one cent per $100
    of assessable deposits for deposit insurance (0.3 cents).  In
    contrast, institutions with deposits insured by SAIF are paying an
    average of 23.4 cents per $100 of assessable deposits for similar
    deposit insurance.  Thus, a premium differential of about 23 basis
    points\11

    currently exists.

    --------------------
    \8 FICO was established in 1987 to recapitalize the Federal Savings
    and Loan Insurance Fund, the former insurance fund for thrifts.  FICO
    was funded mainly through the issuance of public debt offerings which
    were initially limited to $10.8 billion but were later effectively
    capped at $8.2 billion by the RTC Refinancing, Restructuring, and
    Improvement Act of 1991.  Neither FICO's bond obligations or the
    interest on these obligations are obligations of the United States
    nor are they guaranteed by the United States.

    \9 The annual FICO interest obligation, on average, equals
    approximately $780 million.  Because FICO had available cash reserves
    in 1995, its draw on SAIF's assessments was slightly less than the
    amount needed to fully fund the 1995 interest payments.

    \10 Deposit Insurance Funds:  Analysis of Insurance Premium Disparity
    Between Banks and Thrifts (GAO/AIMD-95-84, March 3, 1995) and Deposit
    Insurance Funds:  Analysis of Insurance Premium Disparity Between
    Banks and Thrifts (GAO/T-AIMD-95-111, March 23, 1995).

    \11 One hundred basis points are equivalent to one percentage point.
    In this context, the 23 basis points would translate into a 23-cent
    premium differential for every $100 in assessable deposits.

          THE PREMIUM RATE
          DIFFERENTIAL COULD AFFECT
          FUNDING FOR FICO'S INTEREST
          OBLIGATION AND FUTURE
          DEPOSIT INSURANCE PREMIUM
          RATES
    ---------------------------------------------------------- Letter :5.3

    Only a portion of SAIF's assessment base is available to fund the
    annual FICO interest obligation.\12 This portion of SAIF's assessment
    base has declined on average 11 percent each year since SAIF's
    inception in 1989.  At December 31, 1995, only $459 billion of SAIF's
    total assessment base of $734 billion, or about 62 percent, was
    available to fund the annual FICO interest obligation.  At SAIF's
    current premium rates, the portion of SAIF's assessment base needed
    to fund FICO cannot decline below $333 billion in order to avoid a
    default on the FICO interest payments.

    Absent a legislative solution, the premium rate differential between
    BIF and SAIF provides incentive for SAIF-member institutions to
    reduce their SAIF-insured deposits to avoid paying higher premiums.
    Such reductions would further decrease SAIF's assessment base and
    increase the potential for a default on the FICO bond interest
    obligation.

    When the same product exists in the market place--in this case,
    deposit insurance--but at two substantially different prices, market
    forces can provide a strong incentive to avoid the higher price in
    favor of the lower.  Institutions seeking to avoid higher SAIF
    premiums could do so in a number of ways:  (1) reduce the
    institution's total assets, which, in turn, would reduce its need for
    deposits, (2) obtain funding from sources such as Federal Home Loan
    Bank advances or repurchase agreements, which are not subject to
    insurance premiums, (3) accept BIF-insured deposits as agents for
    BIF-member affiliates, or (4) pay lower interest rates on deposits,
    which would encourage deposits to migrate from SAIF to BIF by letting
    BIF-member affiliates draw away business with deposit rates
    reflecting their lower deposit insurance costs.

    Federal regulators have already observed that some institutions are
    beginning to use these strategies to decrease their SAIF-insured
    deposits and, thus, to avoid the higher SAIF premiums.  Recently, one
    large thrift shifted $2.6 billion in deposits to a BIF affiliate.
    Currently, about 150 SAIF members, with deposits totaling $165
    billion, have BIF-member affiliates or are actively pursuing
    affiliates.  The banking regulators have stated that, under existing
    law, they have limited ability to stop such deposit migration.

    As noted above, a continual shrinkage of SAIF's assessment base could
    have implications not only for debt servicing of the FICO interest
    obligation, but also for SAIF and BIF premium rates.  If SAIF's
    assessment base shrinks to the point that current SAIF premium rates
    can no longer provide for sufficient revenue to fund the annual FICO
    interest payments, a default on the FICO interest obligation could
    result absent an increase in SAIF's premium rates.  Increasing
    premium rates to compensate for the shrinkage in SAIF's assessment
    base could lead to even further shrinkage as the higher premiums
    force more institutions to seek relief by reducing their dependence
    on SAIF-insured deposits.  This, in turn, would increase the
    potential for a default on the FICO interest obligation.  Also, if
    SAIF deposits continue to shrink, the fund will become smaller and
    less able to diversify risk, as it is likely that the stronger SAIF
    member institutions will shift their deposits to BIF, leaving the
    weaker institutions to SAIF.  Finally, if deposits migrate from SAIF
    to BIF, BIF's reserve ratio could be adversely affected because the
    transferred deposits do not bring with them any reserves.  This could
    ultimately result in higher future premium rates for BIF members in
    order for the fund to maintain its designated reserve ratio.

    On March 19, 1996, the House Committee on Banking and Financial
    Services held hearings on the condition of SAIF.  At these hearings,
    the FDIC Chairman, the Acting Director of the Office of Thrift
    Supervision, and the Under Secretary for Domestic Finance of the
    United States Treasury, urged the Congress to pass comprehensive
    legislation to provide a solution to the problems associated with
    capitalizing SAIF, funding FICO, and eliminating the premium rate
    differential.  We have, and continue, to support the need to address
    the significant risks associated with the premium rate
    differential.\13

    --------------------
    \12 Thrift deposits acquired by BIF members, referred to as �Oakar�
    deposits, retain SAIF insurance coverage, and the acquiring
    institution pays insurance premiums to SAIF for these deposits at
    SAIF's premium rates.  However, because the institution acquiring
    these deposits is not a savings association and remains a BIF member
    as opposed to a SAIF member, the insurance premiums it pays to SAIF,
    while available to capitalize SAIF, are not available to service the
    FICO interest obligation.  Similarly, premiums paid by SAIF-member
    savings associations that have converted to bank charters, referred
    to as �Sasser� institutions, are unavailable to fund the FICO
    interest obligation since the institutions are banks as opposed to
    savings associations.

    \13 Deposit Insurance Funds:  Analysis of Insurance Premium Disparity
    Between Banks and Thrifts (GAO/T-AIMD-95-223, August 2, 1995).

          1995 ACTIONS ADDRESS SOME
          WEAKNESSES IDENTIFIED IN
          PREVIOUS AUDITS
    ---------------------------------------------------------- Letter :5.4

    In our 1994 financial statement audit report on the three funds
    administered by FDIC, we identified reportable conditions which
    affected FDIC's ability to ensure that internal control objectives
    were achieved.  These weaknesses related to FDIC's internal controls
    designed to ensure that (1) estimated recoveries for failed
    institution assets were determined using sound methodologies and were
    adequately documented, (2) third party entities properly safeguarded
    assets and reported asset activity to FDIC, and (3) time and
    attendance reporting procedures were effective.  During 1995, FDIC
    and third party asset servicing entities' actions addressed, or
    partially addressed, some of the weaknesses identified in our 1994
    audit report.

    During our 1994 audits, we identified weaknesses in FDIC's
    documentation of, and methodology for, estimating recoveries from
    assets acquired from failed institutions.  To address our concerns,
    FDIC developed historical data to support the formula recovery
    estimates used for most assets with book values under $250,000.
    Also, FDIC revised its guidance for estimating recoveries from failed
    institution assets.  The revised guidance provides more comprehensive
    recovery estimation criteria which take into account the asset's most
    probable disposition strategy and contains strict documentation
    standards to support recovery estimates.  However, while the revised
    procedures provide a sound basis for estimating recoveries for failed
    institution assets, our 1995 audits found that the revised procedures
    were not effectively implemented.

    Our 1994 audits also identified weaknesses in oversight of third
    party entities contracted to manage and dispose of failed institution
    assets.  During 1995, FDIC and third party servicers acted to address
    internal control weaknesses over third party servicers' reporting of
    asset management and disposition activity and safeguarding of
    collections.  Specifically, the Contractor Accounting Oversight Group
    (CAOG) and Contractor Oversight and Monitoring Branch (COMB) of
    FDIC's Division of Finance and Division of Depositor and Asset
    Services, respectively, fully implemented the requirements of the
    Letter of Understanding on Accounting Roles and Responsibilities of
    CAOG and COMB.  This letter outlines specific verification
    procedures, the timing of those procedures, and the FDIC entity
    responsible for performing the procedures at the contracted asset
    servicers.  The letter was issued in October 1994, but was not fully
    implemented until after December 31, 1994.  However, we found that
    during 1995, FDIC verified the accuracy of reported asset activity to
    supporting documentation and to servicers' detailed accounting
    records.

    Third party servicers also improved daily collection procedures
    designed to ensure that collections are properly safeguarded and
    completely and accurately reported.  Specifically, one servicer
    effectively implemented procedures to verify collections received and
    reconcile collections processed and deposited to daily collections.
    Another servicer implemented dual controls over daily collections and
    instituted aggressive procedures for collecting delinquent payments.
    In addition, another servicer completed its servicing agreement with
    FDIC.  As a result of the actions taken by FDIC regarding
    verification of servicer activity reports and actions taken by the
    asset servicers regarding safeguarding of collections, we no longer
    consider these issues to be a reportable condition as of December 31,
    1995.

    While the above actions address some of the internal control
    deficiencies identified in our prior year's audits, some
    long-standing deficiencies remain.  During 1995, we continued to find
    weaknesses in FDIC's adherence to its time and attendance reporting
    procedures.  Also, we continued to find weaknesses in documentation
    used to support estimated recoveries from failed institution assets.
    Finally, while FDIC revised its procedures for estimating recoveries
    for failed institution assets, we found these procedures were not
    effectively implemented.  Consequently, as discussed below, we still
    consider these weaknesses to be reportable conditions as of December
    31, 1995.

       REPORTABLE CONDITIONS
    ------------------------------------------------------------ Letter :6

    The following reportable conditions represent significant
    deficiencies in FDIC's internal controls and should be corrected by
    FDIC management.

    1.  Controls to ensure that recovery estimates for assets acquired
    from failed financial institutions comply with FDIC's revised asset
    recovery estimation methodology are not working effectively.
    Specifically, FDIC's controls do not ensure that recovery estimates
    comply with the methodologies specified in FDIC's Asset Disposition
    Manual (ADM), or are based on current and complete file
    documentation.  Also, FDIC does not have controls in place to ensure
    that, in deriving reasonable estimates of recovery for assets in
    liquidation, the asset recovery estimation process considers the
    impact of events through the period covered by the three funds'
    financial statements.  These estimates are used by FDIC to determine
    the allowance for losses on receivables from resolution activities
    and investment in corporate-owned assets for the funds.
    Consequently, these weaknesses resulted in misstatements to BIF's and
    FRF's 1995 financial statements and could result in future
    misstatements to each fund's financial statements if corrective
    action is not taken by FDIC management.

    In response to recommendations in our 1994 audit report, in August
    1995, FDIC completed the ADM and issued it to Division of Depositor
    and Asset Services field office staff.  This manual contained
    detailed guidance in asset recovery estimation methodologies and
    strict requirements for documentation to support such estimates.
    FDIC's intent in issuing this manual was to ensure that reasonable
    estimates of recoveries were available to facilitate the calculation
    of the December 31, 1995, allowance for losses for the funds
    administered by FDIC.  However, we found that the ADM was not
    effectively implemented.  Specifically, we found that asset recovery
    estimates were not always consistently supported by, and/or
    consistent with file documentation or the most probable disposition
    strategy.  Also, we found that asset recovery estimates were not
    always prepared using the most current information available at the
    time the estimate was developed.

    The Asset Disposition Manual requires supervisory review to verify
    the accuracy and adequacy of recovery estimates.  However, we found
    that the supervisory reviews were generally cursory in nature and
    frequently did not identify recovery estimates that were not in
    compliance with the ADM.  Consequently, these reviews did not always
    identify inaccurate or unsupported asset recovery estimates.

    FDIC uses asset recovery estimates prepared no later than September
    30 in calculating the year-end allowance for losses on the
    receivables from resolution activities and investments in
    corporate-owned assets reflected in the funds' financial statements.
    This creates the potential for significant changes in the estimates
    of recoveries on the underlying assets in liquidation in the last 3
    months of the year to not be fully reflected in the year-end
    financial statements.

    In this regard, we found that significant fluctuations in the
    aggregate estimated recovery value of BIF's and FRF's failed
    institution asset inventory that occurred during the fourth quarter
    of 1995 were not fully reflected in the year-end allowance for losses
    on BIF's and FRF's receivables from resolution activities and
    investment in corporate-owned assets.  These fluctuations were caused
    by a number of factors, such as collections on assets, asset
    dispositions, write-offs, and changes in the circumstances affecting
    individual assets' recovery potential.  The ADM requires individual
    asset recovery estimates to be updated within 30 days following any
    significant event or change in disposition strategy that affects the
    estimated recovery by 5 percent or more.  However, we found that
    recovery estimates were not always updated to reflect these changes.
    Also, when such changes were made, they were not used to update the
    year-end allowance for loss calculation.

    The lack of consistent adherence to the revised asset valuation
    methodology, particularly regarding the need for adequate
    documentation to support such estimates, combined with the lack of an
    effective process for fully considering the impact of events between
    the asset valuation date and year-end, resulted in FDIC understating
    BIF's and FRF's allowance for losses on their receivables from
    resolution activity and investment in corporate-owned assets.  This,
    in turn, contributed to FDIC misstating BIF's fund balance and FRF's
    accumulated deficit as of December 31, 1995.

    We selected samples of BIF's and FRF's inventories of failed
    institution assets.  Using the criteria contained in the ADM, we
    reviewed FDIC's compliance with the ADM at September 30, 1995, and we
    estimated recoveries for the assets in our samples through the
    December 31, 1995, financial statement date.  Based on our work, we
    estimate that BIF's fund balance was overstated by about $266 million
    and FRF's accumulated deficit was understated by about $183 million.
    However, these amounts were not significant enough to materially
    misstate the 1995 financial statements.\14

    FDIC is currently making substantial changes to its asset valuation
    process.  The new process is intended to provide for uniformity
    throughout the organization in estimating amounts to be recovered
    from failed financial institution assets and will rely heavily on
    statistical sampling procedures as well as economic and market
    assumptions.  However, it will also rely heavily on available asset
    documentation in determining the appropriate assumptions to be used
    to develop recovery estimates.  Consequently, in implementing this
    new asset valuation process, FDIC should ensure that the weaknesses
    we have identified with respect to the process used during 1995 are
    fully addressed.

    2.  FDIC has not strictly enforced adherence to its time and
    attendance reporting procedures.  As in previous audits, our 1995
    audits continued to identify deficiencies in adherence to required
    procedures in preparing time and attendance reports, separation of
    duties between timekeeping and data entry functions, and
    reconciliation of payroll reports to time cards.  These weaknesses
    could adversely affect FDIC's ability to properly allocate expenses
    among the three funds.

    In April 1996, FDIC began implementing a new process intended to
    streamline and improve time and attendance reporting.  FDIC officials
    have indicated that the revised time and attendance process
    constitutes the initial steps in developing a fully automated system.
    However, while this revised process may result in some increased
    efficiencies, the new process, in and of itself, will not correct the
    deficiencies we identified during the past several years.  Further
    improvements and ultimately a fully automated system may reduce the
    occurrence of weaknesses such as inadequate reconciliations and lack
    of separation of duties, but they offer no assurance that existing
    problems will be fully resolved.  Given the longstanding nature of
    time and attendance reporting deficiencies and the failure of past
    efforts to fully satisfy our prior audits' recommendations to correct
    these deficiencies, it is critical that FDIC management strictly
    enforce adherence to current and future time and attendance reporting
    procedures.

    3.  We identified another weakness related to FDIC's electronic data
    processing controls during our 1995 audits which, due to its
    sensitive nature, is being communicated to FDIC management, along
    with our recommendations for corrective action, through separate
    correspondence.

    In addition to the weaknesses discussed above, we noted other less
    significant matters involving FDIC's system of internal accounting
    controls and its operations, which we will be reporting separately to
    FDIC.

    --------------------
    \14 In making this determination, we considered the needs of the
    users of BIF's and FRF's financial statements.  In BIF's case, we
    considered the Fund balance to be the most significant component to
    the financial statement users, as the Fund balance reflects BIF's
    financial health and is a primary consideration in setting premium
    rates for insured member institutions.  In FRF's case, we considered
    the Accumulated Deficit to be the most significant component to the
    financial statement users, as it reflects amounts to be funded from
    appropriations to liquidate the assets and contractual obligations of
    the defunct FSLIC.  In this context, the misstatements we identified
    through our audits represent one-percent of BIF's $25.5 billion fund
    balance, and 0.4 percent of FRF's $43.4 billion Accumulated Deficit,
    respectively, at December 31, 1995.  We also noted in FRF's case that
    the Fund's Resolution Equity at December 31, 1995, is more than
    sufficient to cover additional losses even were such losses to exceed
    the level of misstatement we identified in FRF's 1995 financial
    statements.

       RECOMMENDATIONS
    ------------------------------------------------------------ Letter :7

    To address weaknesses identified in this year's audits in the area of
    estimating recoveries for failed institution assets, we recommend
    that the Chairman of the Federal Deposit Insurance Corporation direct
    heads of the Division of Depositor and Asset Services and Division of
    Finance to

      -- ensure that field office personnel maintain complete and current
         documentation in asset files to provide a basis for assumptions
         used to derive asset recovery estimates and that the assumptions
         used are appropriately documented,

      -- ensure that supervisory reviews of asset recovery estimates are
         performed thoroughly and include a review of asset file
         documentation to identify and correct inaccurate or unsupported
         estimates, and

      -- establish and enforce procedures to ensure that recovery
         estimates are updated for information made available between the
         valuation date and the year-end financial statement reporting
         date.

       CORPORATION COMMENTS AND OUR
       EVALUATION
    ------------------------------------------------------------ Letter :8

    In commenting on a draft of this report, FDIC acknowledged that
    further improvements could be made to resolve weaknesses in its asset
    valuation process and is initiating a new process for estimating
    asset recoveries.  FDIC expects this process to be in place for the
    1996 annual financial statements.  FDIC believes that this new
    process will address concerns regarding asset valuation methodology,
    documentation, management review, and timing differences.  We will
    review FDIC's new asset valuation process as part of our 1996
    financial audits.

    FDIC also stated that it reviewed the assets sampled by us in our
    audits.  FDIC noted that its own review found instances of
    noncompliance by FDIC personnel with the revised Asset Disposition
    Manual guidelines for estimating asset recoveries.  FDIC stated that
    its review also found numerous instances in which GAO and FDIC were
    in complete or substantial agreement.  FDIC concluded from its review
    that the revised asset recovery methodology was generally understood
    and that its staff, in general, properly prepared asset recovery
    estimates.

    FDIC also stated that it believes its asset recovery estimates, in
    the aggregate, are reasonable.  FDIC said that asset valuations often
    cannot be determined with precision, and that various reasonableness
    tests performed by FDIC staff support the position that both FDIC's
    asset recovery estimates as reflected in BIF's and FRF's 1995
    financial statements and our estimates of the aggregate recovery
    value of the assets are reasonable.  Thus, FDIC believes that there
    is no basis for asserting that either set of estimates is more
    accurate than the other.

    We agree that estimating potential recoveries on failed institution
    assets is subject to some degree of uncertainty.  It is this inherent
    uncertainty in the estimation process that makes strict adherence to
    a sound methodology critical to ensuring that reasonable estimates
    are derived for use in preparing the financial statements.  Our
    estimates are based on a strict application of FDIC's revised
    methodology and include the impact on asset recovery potential of
    events through the financial statement reporting date.  While certain
    analytical procedures, as applied by FDIC, may help to provide
    additional comfort as to the reasonableness of FDIC's official
    estimation process, they are not a substitute for a systematic,
    reasonable, and verifiable methodology.

    As we discuss in this report, FDIC took significant steps during 1995
    to address the deficiencies in its asset valuation methodology that
    we identified in previous audits.  However, the level of compliance
    with the revised methodology was significantly deficient.  We found
    that in over 41 percent of the assets we sampled, FDIC field office
    personnel did not comply with the revised methodology.  This level of
    noncompliance coupled with the impact on asset recovery estimates of
    events subsequent to FDIC's valuation date but up to the financial
    statement reporting date resulted in differences in recovery
    estimates in about 89 percent of the assets we reviewed.  FDIC's own
    review of the assets we sampled confirmed our audit findings.  As we
    noted in this report, we believe the resulting level of misstatements
    were not significant enough to materially misstate BIF's and FRF's
    1995 financial statements.  However, they do illustrate the impact
    that weaknesses in controls over the asset valuation process can have
    on the financial statements.

    FDIC also commented on initatives it has underway to address the
    deficiencies we identified in its time and attendance reporting and
    audit processes.  FDIC believes these initiatives will facilitate the
    timely identification and correction of time and attendance related
    issues.  In addition, FDIC noted that it is studying its current
    expense allocation and recovery methodologies and, as part of this
    undertaking, is developing methods that will reduce reliance on time
    and attendance reporting in determining expense allocations to funds
    and receiverships.  FDIC noted that it is currently addressing
    weaknesses we identified in its electronic data processing controls.

    FDIC also discussed other management initiatives it has underway to
    improve its operational effectiveness, including enhancements to its
    contracting oversight and a more corporatewide monitoring of internal
    control issues.  FDIC noted that it has also established an audit
    committee to review the adequacy of the Corporation's internal
    controls and compliance with laws and regulations, and to review
    internal and external audit recommendations.

    The complete text of FDIC's response to our report is included in
    appendix I.

    Charles A.  Bowsher
    Comptroller General
    of the United States

    May 2, 1996

    BANK INSURANCE FUND'S FINANCIAL
    STATEMENTS
    ============================================================ Chapter 0

       Statements of Financial
       Position

       (See figure in printed
       edition.)

       Statements of Income and the
       Fund Balance

       (See figure in printed
       edition.)

       Statements of Cash Flows

       (See figure in printed
       edition.)

       Notes to the Financial
       Statements

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

    SAVINGS ASSOCIATION INSURANCE
    FUND'S FINANCIAL STATEMENTS
    ============================================================ Chapter 1

       Statements of Financial
       Position

       (See figure in printed
       edition.)

       Statements of Income and the
       Fund Balance

       (See figure in printed
       edition.)

       Statements of Cash Flows

       (See figure in printed
       edition.)

       Notes to the Financial
       Statements

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

    FSLIC RESOLUTION FUND'S FINANCIAL
    STATEMENTS
    ============================================================ Chapter 2

       Statements of Financial
       Position

       (See figure in printed
       edition.)

       Statements of Income and
       Accumulated Deficit

       (See figure in printed
       edition.)

       Statements of Cash Flows

       (See figure in printed
       edition.)

       Notes to the Financial
       Statements

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

       (See figure in printed
       edition.)

    (See figure in printed edition.)Appendix I
    COMMENTS FROM THE FEDERAL DEPOSIT
    INSURANCE CORPORATION
    ============================================================ Chapter 2

    (See figure in printed edition.)

    (See figure in printed edition.)

    (See figure in printed edition.)

    (See figure in printed edition.)

    (See figure in printed edition.)

    MAJOR CONTRIBUTORS TO THIS REPORT
    ========================================================== Appendix II

    ACCOUNTING AND INFORMATION
    MANAGEMENT DIVISION, WASHINGTON,
    D.C.

    Robert W.  Gramling, Director
    Steven J.  Sebastian, Assistant Director
    Clayton T.  Clark, Senior Auditor
    Paul F.  Foderaro, Senior Auditor
    Charles Fox, Senior Auditor
    Jeanette M.  Franzel, Senior Auditor
    Michael C.  Hrapsky, Senior Auditor
    Salim R.  Mawani, Senior Auditor
    Christopher M.  Salter, Senior Auditor
    Gregory J.  Ziombra, Senior Auditor
    Kevin A.  Carey, Auditor
    Dennis L.  Clarke, Auditor
    John C.  Craig, Auditor
    Douglas A.  Delacruz, Auditor
    Bonnie L.  Lane, Auditor
    Elizabeth Martinez, Auditor
    Carol A.  Langelier, EDP Specialist
    Wilfred Holloway, Senior Computer Specialist
    Sharon O.  Byrd, Computer Specialist

    ATLANTA REGIONAL OFFICE

    Shawkat Ahmed, Senior Auditor
    Suzanne Murphy, Senior Auditor
    Cynthia C.  Teddleton, Senior Auditor
    Erin Baker, Auditor
    Marshall L.  Hamlett, Auditor
    Rhonda P.  Rose, Auditor
    Lisa M.  Warde, Auditor

    CHICAGO REGIONAL OFFICE

    Adrienne S.  Friedman, Senior Auditor
    Donald J.  Kittler, Senior Auditor
    John R.  Richter, Senior Auditor

    DALLAS REGIONAL OFFICE

    George Jones, Senior Auditor
    Norman C.  Poage, Senior Auditor
    Miguel A.  Salas, Senior Auditor
    Leonard E.  Zapata, Senior Auditor
    Gloria Cano, Auditor
    Dale W.  Seeley, Auditor
    Dorothy M.  Tejada, Computer Specialist

    LOS ANGELES REGIONAL OFFICE

    Jan M.  Brock, Senior Auditor
    Eric Johns, Senior Auditor
    Harold D.  Reich, Senior Auditor
    Aditi S.  Archer, Auditor
    Ted Hu, Auditor
    Stacey Osborn, Auditor
    Gary R.  Wiggins, Auditor

    FDIC OFFICE OF INSPECTOR GENERAL

    Arlene Boateng, Auditor
    Mary Boyles, Auditor
    Jennifer Y.  Colbert, Auditor
    Judith H.  Hoyle, Auditor
    Mark F.  Mulholland, Auditor
    Lisa M.  Pearson, Auditor
    Dale Sewell, Auditor

    *** End of document. ***