Board approves 2018 $2.1 billion budget (down 3% from previous year), with acting CFPB director’s participation

A nearly $2.1 billion budget for 2018 was approved 3-0 Tuesday by the board overseeing the nation’s bank and savings institution insurance fund, a decrease of about 3% from the previous year.

The voting included that by the acting director of the consumer protection agency, attending his first meeting of the board.

The three members of the board of the Federal Deposit Insurance Corp. (FDIC) attending the meeting – Chairman Martin Gruenberg, Vice Chairman Thomas Hoenig and acting director of the Consumer Financial Protection Bureau (CFPB) Mick Mulvaney – also approved an authorized staffing level of 6,076 positions for 2018, a 4.5% decrease from 2017.

Not attending the meeting Tuesday was Comptroller of the Currency Joseph Otting.

Gruenberg, reading a prepared statement, noted that the agency’s budget of $2.092 billion “continues to reduce operating expenses and staffing in the proved manner, while providing resources that will be needed next year to meet the FDIC’s important mission responsibility.”

He said the budget will also provide additional funding for IT security, which he called an important priority for the agency. “I would note that next year’s budget and staffing will be lower than the prior year, I believe for the eighth consecutive year, reflecting the continued steady improvement in the health of the banking industry over this period as well, as well the FDIC’s efforts to carefully management its resources.”

In fact, the 2018 FDIC budget, the agency pointed out, is 48% lower than the peak for the agency funding in 2010, at the height of the financial crisis.

Mulvaney, attending his first meeting of the agency board in his capacity as acting director of the CFPB (and also current director of the White House Office of Management and Budget) commended the agency’s budget preparation.

“As you can imagine, I’ve seen a couple budgets,” Mulvaney said. “Honestly I wish more of them looked like this. You are commended in the way that you have handled the flexibility in your budget and the flexibility that contracted services gets you.”

The acting CFPB director said that the way the agency handles contracted services allows it to “grow up” when it needs more services, and “grow down” when it needs fewer, “is to be commended.” He called the approach a “model I’m curious to see if other agencies could take.”

More specifically, the budget includes $1.8 billion for “ongoing operations” (up 0.3%, or $5.9 million, from 2017’s budget) $225 million for receivership funding (down 25%, or $75 million) and $40 million (up 9.1%, or $3.3 million) for the agency’s office of inspector general.

The overall budget is $65.7 million (3%) lower than the 2017 spending plan.

FDIC Board Approves 2018 Operating Budget, Down 48 Percent from Peak in 2010