Who Can Become a Member of the Federal Reserve System
Any state-chartered bank (mutual or stock-formed) may become a member of the Federal Reserve System. The twelve regional Reserve Banks supervise state member banks as part of the Federal Reserve System’s mandate to assure strength and stability in the nation’s domestic markets and banking system. Reserve Bank supervision is carried out in partnership with the state regulators, assuring a consistent and unified regulatory environment. Regional and community banking organizations constitute the largest number of banking organizations supervised by the Federal Reserve System.

The Federal Reserve has been in the business of ensuring the safety and soundness of banks since 1914. Membership conveys an association with the general reputation and public trust the Federal Reserve enjoys as our country’s central bank. Benefits of membership include the eligibility of service as a director, affording member banks the opportunity to participate in monetary policy formulation. Through its decentralized structure, use of emerging technology and partnerships with state regulators, the Federal Reserve has developed a risk-focused approach that is responsive and provides member banks with a high quality and efficient supervisory process.

Responsiveness

• Supervisory decisions are made at the Reserve Bank, where officers and examiners are familiar with local business conditions and practices.
  
  
• Bankers have ready access to the Reserve Bank officer responsible for their institution.
  
  
• State member banks are assigned a Reserve Bank representative to serve as the banks’ central point of contact with regard to supervisory and regulatory matters.
  
  
• The Federal Reserve’s local supervision model is closely aligned with the state banking model and is supportive of the dual banking system.
  
  
• Reserve Bank examiners are available to make advisory visits for areas of special interest such as consumer compliance, the Bank Secrecy Act or risk management practices.

Quality

• The Federal Reserve’s risk focused examinations are tailored to a bank’s size and activities, and allow examiners to balance transaction testing with the strength of the bank’s risk management practices.
  
  
• Information provided as part of the supervisory process is clear, concise, timely and geared to meet the bank’s needs.
  
  
• Federal Reserve staff have a well deserved reputation of being professional, dedicated and fair.

Efficiency

• In the case of a state member bank owned by a bank holding company, the Federal Reserve directly supervises both institutions, promoting a consistent supervisory approach for the entire organization.