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DEFINITIONS

DEFINITIONS. Community Bank Covers cities, towns Sells to consumers, businesses Branches Regional Bank Covers states, entire region Typically grew by acquisition Sells to consumers, businesses, other banks Wider range of products. Sweet Spot: $300 million – $1 billion. PROFILE.

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DEFINITIONS

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  1. DEFINITIONS • Community Bank • Covers cities, towns • Sells to consumers, businesses • Branches • Regional Bank • Covers states, entire region • Typically grew by acquisition • Sells to consumers, businesses, other banks • Wider range of products Sweet Spot: $300 million – $1 billion

  2. PROFILE • Environment • Cisco & Vanguard routers • Microsoft Exchange for email • Novell Netware • Budgets • Growing because of expanding compliance requirements • Easier to justify cap-ex expenditures on calendar year Typical configuration includes: Backbone router connecting branches via Frame, VPN, or T1

  3. REGULATORY REQUIREMENTS 4 Types of Bank Exams • Federal Deposit Insurance Commission (FDIC) • State • Internal • Third-party Always dealing with an audit

  4. GRAMM-LEACH-BLILEY • Gramm-Leach-Bliley (“GLB”) • Effective 7/01 – banks still grappling with compliance • Mandates that a bank “take all necessary steps to protect private information about its customers” • Includes all actions to protect customer data • Banks must perform risk assessment • Must create an Information Security Program • New compliance issues continuing to emerge

  5. THE LINGO “Safety and Soundness” Exam • Type of exam the FDIC conducts • Measures “financial soundness and safety of depositor funds” • Includes Information Systems and eBanking sections • Extends beyond technology to physical protection of assets

  6. COMPLIANCE • All examiners give “marks” • Highest mark for IT is “outstanding” • Penalties include: • MOU – Memo of Understanding • Temporary shutdown of services • Cease and desist • Hugh financial repercussions

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