What does a Financial Examiner do?
Financial examiners determine if financial institutions and transactions are in compliance with the law by evaluating the risk level of loans, assess bank management, and review balance sheets. Those working in consumer compliance would monitor lending activity to make sure that borrowers are fairly treated.
They present reports detailing the safety and soundness of the institution and review the minutes of the managers and directors meetings.Financial examiners are mainly employed by the insurance and finance industry or state or federal governments typically on a full-time basis.
How to become a Financial Examiner
A financial examiner requires a bachelor’s degree that includes coursework in finance, accounting, economics, or a related field. However, specific requirements may vary between state and federal governments. Those working for the Federal Deposit Insurance Corporation (FDIC) need a minimum of 6 semester hours in accounting. After employment, one receives on-the-job training with entry level workers under the supervision of senior examiners.
Financial examiners with a few years experience may advance to senior examiner positions, but would typically need to hold a master’s degree in business or accounting or become a (CPA) Certified Public Accountant.
Job Description of a Financial Examiner
A financial examiner has the duties of monitoring the financial condition of financial institutions such as, banks and examine balance sheets, loan documentation to confirm institution liabilities and assets, and operating income and expense accounts. He or she may train other examiners in the financial examination process.
A financial examiner analyses and reviews any new policies or regulations to determine any impacts on the institution and establish guidelines for policies and procedures to remain in compliance with new and revised regulations. They typically work in one of two main areas, which are, consumer compliance or risk scoping. Those working in consumer compliance monitor lending activity to ensure the fair treatment of borrowers and ensure that bad loans given to a borrower have the ability to pay the loan back to the bank.
In addition, a consumer compliance examiner helps the borrower avoid “predatory loans” that generate profit for banks because of high interest rates but may potentially damage the credit score of the borrower in the event the loan may be too costly to pay back. He or she also ensures there is no discrimination to borrowers by a bank. One working in risk scoping determine a financial institutions health. They make sure that banks and other financial institutions offer safe loans and have a required amount of cash on hand to handle unexpected losses. He or she would evaluate the performance of bank managers.