Financial examiners ensure compliance with laws governing financial institutions and transactions. They review balance sheets, evaluate the risk level of loans, and assess bank management.
Financial examiners typically do the following:
Monitor the financial condition of banks and other financial institutions
Review balance sheets, operating income and expense accounts, and loan documentation to confirm institution assets and liabilities
Prepare reports that detail an institution's safety and soundness
Examine the minutes of meetings of managers and directors
Train other examiners in the financial examination process
Review and analyze new regulations and policies to determine their impact on the organization
Establish guidelines for procedures and policies that comply with new and revised regulations
Financial examiners typically work in one of two main areas: risk scoping or consumer compliance.
Those working in risk scoping evaluate the health of financial institutions. Their role is to ensure that banks and other financial institutions offer safe loans and that they have enough cash on hand to handle unexpected losses. These procedures help ensure that the financial system as a whole remains stable. These examiners also evaluate the performance of bank managers.
Financial examiners working in consumer compliance monitor lending activity to ensure that borrowers are treated fairly. They ensure that banks extend loans that borrowers are likely to be able to pay back. They help borrowers avoid “predatory loans”—loans that may generate profit for banks through high interest payments but may be costly to borrowers and damage their credit scores. Examiners also ensure that banks do not discriminate against borrowers based on ethnicity or other characteristics.