First by focusing its supervisory efforts on the adequacy of the risk management and internal control process of the parent company and of the group as a whole, and determining how well those systems protect the safety and soundness of affiliated banks. That evaluation could be performed in a manner similar to that of a securities analyst, albeit from a different viewpoint.
This assessment might involve analysis of public financial statements, rating agencies and Wall Street analyst reports, internal management reports, internal and external audit reports, meetings with management, and only limited, if any, on-site inspections of nonbank affiliates. Any visits that are made could be limited to testing the adequacy of management and operating systems, to protect the insured depository institution.