How are banks chartered and regulated?
Charter Bank organizers have a choice of a state or federal charter which allows them to open and operate their bank. Organizers that choose to be regulated by the state are chartered by the Arizona Department of Financial Institutions. They can apply for a federal charter with the OCC or the Office of Thrift Supervision (“OTS”). All banks operating in Arizona are insured by the FDIC. All national and savings banks (including Wells Fargo Bank, Bank of America, Chase Bank and Washington Mutual Bank) are supervised by the OCC or the OTS. All bank holding companies are regulated by the Federal Reserve System. Regulation State and federal regulators conduct periodic examinations that ensure that the Board of Directors and bank management have adequate policies and procedures in place to operate the bank in a sound and safe manner. Regulators examine for capital adequacy, asset quality, management, earnings, liquidity and sensitivity to market risk. Banks are required to report the conditio
