WASHINGTON ( TheStreet) -- Saying that the agency had "received some criticism that its examination findings have been overly harsh," the Federal Deposit Insurance Corp. on Tuesday encouraged bankers to speak up.

State-chartered banks are supervised by state examiners, as well as the FDIC. In many states, the FDIC carries most of the regulatory burden for these institutions. In a letter sent to insured banks, the FDIC acknowledged "the difficult challenges that banks face at this time," and said that it expected its staff's interaction with bankers to be "professional, balanced, and fair in tone and content."

The agency reminded bankers that if they disagree with examination findings, they could discuss these disagreements with the examiner-in-charge, and if necessary escalate a complaint to the local field office or regional director's office.

The FDIC reiterated that its policies "prohibit retaliation, abuse, or retribution" by examiners or other personnel, and said that banks believing they had been retaliated against, could file a complaint with the agency's Office of the Ombudsman. The FDIC said the Ombudsman provides "a confidential, neutral and independent source of information and assistance," working with both parties to "Reach an acceptable solution."

The FDIC didn't return a call requesting comment on the type of complaints the agency had received from bankers.

Jonathan Hullick, president of Bank Performance Solutions and former senior FDIC regulator and bank turnaround executive said that "complaints about harsh regulators tend to come from troubled banks and bankers who haven't done the right things."

One bank that has taken a more public route in pursuing complaints against the FDIC is Republic Bank & Trust of Louisville, Ky., which is held by Republic Bancorp ( RBCAA). Following an FDIC Notice of Charges alleging "unsafe and unsound underwriting practices" relating to the Bank's practice of providing loans secured by anticipated federal tax refunds, Republic sued the agency on Feb. 28, claiming the FDIC had abused its discretion in an attempt to eliminate refund anticipation loans.

In August 2010, the Internal Revenue Service announced it would no longer give third parties, including Republic Bank & Trust, access to the IRS's "debt indicator" information, which would indicate whether a taxpayer might be denied a tax refund for a variety of reasons, "including federally insured loans, delinquent child support and federal and state tax liens."

SNL Financial reported that Republic alleged the FDIC had pushed other lenders out of the tax refund anticipation loan business, including HSBC Taxpayer Financial Services (a unit of HSBC Holdings ( HBC)) and Ohio Valley Banc Corp ( OVBC), which announced on February 3 that it would exit the business after April 19.


--Written by Philip van Doorn in Jupiter, Fla.

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Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.