Former FDIC chair: Workplace culture at the FDIC can and must be fixed.

The Federal Deposit Insurance Corporation (FDIC) has existed for more than 90 years with a mission to maintain stability and public confidence in the nation’s financial system. The FDIC has accomplished this task because of its public service culture and commitment to do whatever is necessary to protect insured depositors. During the past nine decades, FDIC’s most valuable assets — and the ones on the front lines delivering this mission — are its employees.

The FDIC now faces one of the most important challenges in its history — whether it can attract, retain and develop talent, regain trust in leadership to treat people with respect and dignity, and be perceived once again as a great place to work. This crisis of confidence in FDIC’s leadership is disturbing, has impacted the reputation of the agency and leaves the impression that the FDIC might have difficulty meeting its mission.

As a former chairman of the FDIC during the massive banking and thrift crisis of the 1980s, I know full well how FDIC employees can conduct themselves professionally, with the highest ethical standards and loyalty to their agency and their nation. During my tenure, the FDIC grew enormously to deal successfully with a massive number of bank failures. 

At the time, we understood the elevated risk of abuse associated with existing staff — and thousands of new and temporary employees and contract workers — and managing tens of billions of dollars of complex failed bank assets. We always made it clear in our words and actions that ethical behavior and treatment of people was paramount; and any abuses would result in dismissal and be reported to law enforcement and prosecuted whenever appropriate.

I believe that one of my most important legacies at the FDIC was purchasing a large parcel of land bordering on George Mason University just outside Washington, D.C. to build a world-class training center for bank examiners from the FDIC, the Federal Reserve, Comptroller of Currency, state banking departments and bank regulatory authorities from around the world. It is a state-of-the-art training facility. It was an honor for me to attend the dedication ceremony several years after I left the FDIC and heartbreaking now to hear of the facilities being misused by a few undeserving employees. Such behavior should never be tolerated and employees who engage in it should be dismissed. 

Very few people at the FDIC today were at the FDIC in the 1980s, and those who were there were not in senior positions. It is now essential to begin the healing process and restore the FDIC to its position as one of the most dependable and trust-worthy agencies in government. It is critical that the public have 100 percent confidence in the FDIC’s competence, reliability and absolute integrity.

Let us now begin the process of restoring the FDIC’s position and reputation as one of the best agencies in government. This will be best accomplished by building a new generation of leaders who understand that fairness and integrity in the workplace contribute to employees feeling safe, respected and valued.

William Isaac, former chairman of the FDIC & Fifth Third Bancorp, is chairman of Secura/Isaac Group, a consultancy to financial institutions globally. The views expressed are his alone and do not necessarily reflect the views of any firm with which he is or has been associated.