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May 5, 2023

Board of Directors
XXXXX

Subject: Transmittal of Safety and Soundness Report of Examination

Members of the Board:

Enclosed is a copy of the February 27, 2023 Joint FDIC XXXXX Report of Examination (Report). In addition to our safety and soundness findings, the Report includes the results of Anti-Money Laundering /Countering the Financing of Terrorism (AML/CFT) review and Information Technology (IT) review. The Bank’s Digital Banking Division was also reviewed during this examination. Regulatory comments regarding the Digital Banking Division will be provided to the Board under a separate letter.

Summary of Examination Findings

The bank’s overall financial condition remains XXXXX. The Board approved Business Plan (Plan) describes traditional bank activities as well as proposals for new digital bank activities. XXXXX a significant source of growth may arise from expanding the digital bank division. XXXXX.

Our review found the Bank’s future digital bank activities remain under development, and, we acknowledge and appreciate management’s commitment to the FDIC and XXXXX to pause all digital bank activities until obtaining regulatory feedback. XXXXX.

Board of Directors

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Page 2

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Action Requested

  • Each member should thoroughly review the Report and acknowledge their review by signing the Signatures of Directors/Trustees page included as the last page of the Report. Please retain this page with the Report.
  • Record the Board’s review of the Report in the Board minutes.
  • Please respond to the findings contained in the Report to both of our offices. We request your reply within 45 days of the date of this letter.

Confidentiality Notice

This copy of the Report is the property of the FDIC and the XXXXX and is furnished to the institution examined for its confidential use. Neither the institution, nor any of its directors, officers, or employees, may disclose or make public in any manner any portion of this Report under any circumstances. Refer to Part 309 of the FDIC Rules and Regulations for additional information on confidentiality restrictions. If any subpoena or legal process calling for production of this Report is received, both agencies should be notified immediately.

Post-Examination Survey

In addition to the Report, we have enclosed a request from FDIC Office of the Ombudsman Director XXXXX for feedback on the examination process. Please take a few moments to review the enclosed letter and complete the survey.

Questions should be directed to Assistant Regional Director Jaclyn Valderrama or Senior Case Manager XXXXX at XXXXX and XXXXX, respectively, or Examinations Managers XXXXX.

Sincerely,

/s/ Jaclyn Valderrama
Jaclyn M. Valderrama
Assistant Regional Director

Enclosures
cc: Federal Reserve Bank of San Francisco