II. "An Agency Responsible for the Regulation or Supervision of Financial Institutions"

A second requirement under Exemption 8 is that the agency at issue must be “responsible for the regulation or supervision of financial institutions.” One example of such an agency is the National Credit Union Administration, which regulates and examines chartered federal credit unions.¹³ If the agency at issue does not perform either of those functions, you should argue that its records fall outside the scope of this exemption.

However, the U.S. Court of Appeals for the District of Columbia Circuit has further held that Exemption 8 does not require that an agency “regulate or supervise the particular institution that is the subject of the report” for Exemption 8 purposes.¹⁴ Where the Farm Credit Administration prepared annual credit examinations of the National Consumer Cooperative Bank — but did not directly regulate or supervise it — the court held that the agency’s examination reports on the bank were still exempt from disclosure.¹⁵

The court reasoned that even though the agency did not regulate or supervise the bank, releasing examination reports discussing “the quality of the [bank’s] loans, internal controls, and management practice and structure” would be inconsistent with the purpose of Exemption 8. ¹⁶ That is, the release of the agency’s “frank evaluations” of the bank could “undermine public confidence and investment” in the bank and thereby “strain the cooperation between them” necessary to the examination process.¹⁷

In arguing that an agency is not “responsible for the regulation or supervision of financial institutions,” it may not be sufficient to merely state that the agency does not technically “regulate” or “supervise the institution. In order to strengthen your argument, you should explain how release of that information would neither undermine public confidence in the institution nor make the institution less cooperative with the agency.