[Federal Register Volume 83, Number 238 (Wednesday, December 12, 2018)]
[Notices]
[Pages 63868-63869]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-26811]
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FEDERAL DEPOSIT INSURANCE CORPORATION
RIN 3064-ZA03
Request for Information on the FDIC's Deposit Insurance
Application Process
AGENCY: Federal Deposit Insurance Corporation (FDIC).
ACTION: Notice and request for information.
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SUMMARY: The FDIC is seeking comment from interested parties regarding
the FDIC's deposit insurance application process.
DATES: Comments must be received by February 11, 2019.
ADDRESSES: You may submit comments, identified by RIN 3064-ZA03, by any
of the following methods:
Agency Website: http://www.fdic.gov/regulations/laws/federal/. Follow the instructions for submitting comments on the Agency
website.
Email: [email protected]. Include the RIN 3064-ZA03 in the
subject line of the message.
Mail: Robert E. Feldman, Executive Secretary, Attention:
Comments, Federal Deposit Insurance Corporation, 550 17th Street NW,
Washington, DC 20429.
Hand Delivery: Comments may be hand-delivered to the guard
station at the rear of the 550 17th Street NW, building (located on F
Street) on business days between 7:00 a.m. and 5:00 p.m.
Instructions: All comments received must include the agency name
and RIN 3064-ZA03 for this request for information. All comments
received will be posted without change to http://www.fdic.gov/regulations/laws/federal/--including any personal information
provided--for public inspection. Paper copies of public comments may be
ordered from the FDIC Public Information Center, 3501 North Fairfax
Drive, Room E-1002, Arlington, VA 22226, or by telephone at (877) 275-
3342 or (703) 562-2200.
FOR FURTHER INFORMATION CONTACT:
RMS Contacts: Donald Hamm, Special Advisor, (202) 898-3528,
[email protected].
Legal Contacts: Annmarie Boyd, Counsel, (202) 898-3714,
[email protected]; Catherine Topping, Counsel, (202) 898-3975,
[email protected].
SUPPLEMENTARY INFORMATION:
Background
The FDIC is responsible for maintaining stability and public
confidence in the nation's financial system by insuring deposits,
examining and supervising financial institutions for safety and
soundness and consumer protection, making large and complex financial
institutions resolvable, and managing receiverships. As part of this
mission, the FDIC grants deposit insurance to newly formed institutions
and to operating institutions that are not currently insured.
Section 5 of the Federal Deposit Insurance Act (FDI Act), 12 U.S.C.
1815(a), requires any proposed depository institution seeking federal
deposit insurance to file an application with the FDIC. In every case,
the FDIC's review considers the statutory factors enumerated in Section
6 of the FDI Act, 12 U.S.C. 1816:
The institution's financial history and condition,
The adequacy of the institution's capital structure,
The institution's future earnings prospects,
The general character and fitness of the management of the
institution,
The risk presented by the institution to the Deposit
Insurance Fund,
The convenience and needs of the community to be served by
the institution, and
Whether the institution's corporate powers are consistent
with the purposes of the FDI Act.
In general, the FDIC applies the same processes to the review of
each deposit insurance application. However, because applications
present a wide range of structures, strategies, and business models,
each review focuses on the facts and circumstances presented in the
application.
Overview of Request for Information
Within the context of the existing statutory framework, the FDIC is
seeking comments regarding the deposit insurance application process,
including with respect to the transparency and efficiency of the
process, and any unnecessary burdens that have become a part of the
process. The FDIC encourages comments from all interested members of
the public, including but not limited to insured depository
institutions, other financial institutions or companies, individual
depositors and consumers, consumer groups, and other interested
stakeholders.
Summary of the Deposit Insurance Application Process
The FDIC follows an established review process that is applied to
all types of deposit insurance applications in order to inform the
public and assure the fair treatment of all applicants. In broad terms,
the deposit insurance application process includes pre-filing
activities, application submission, and the FDIC's application review
and processing.
The primary objective of the review process is to consider whether
the proposed institution satisfies the statutory requirements. In
general, deposit insurance will be granted if the FDIC is able to find
favorably on each of the statutory factors, plus the considerations
required by the National Historic Preservation Act and the National
Environmental Policy Act.
The pre-filing activities generally include the earliest steps in a
proposed institution's formation. These steps primarily involve
identifying organizers, directors, and key officers; developing the
business plan; determining the appropriate amount of capital to be
raised; and engaging in one or more pre-filing meetings with staff from
the FDIC and other relevant agencies. The FDIC also announced that
organizers may obtain the FDIC's feedback on a draft deposit insurance
proposal during the pre-filing period.
Following submission of an application, the FDIC will conduct an
initial review to determine whether the application is substantially
complete. If the application is substantially complete, the FDIC will
accept the application for processing and, in coordination with the
other relevant state and federal agencies, complete a detailed review
of the application that includes a field investigation.
Depending on the application's characteristics and the findings
with regard to the statutory factors, authority to act may reside at
the Regional Office level, or may transfer to the FDIC's Washington
Office or Board of Directors. Although the FDIC's processing time will
vary depending on the unique characteristics of each proposal, the FDIC
strives to act on applications within four months after being accepted
as substantially complete.
The FDIC has provided a number of resources, accessible through the
FDIC's website, to aid organizers and other interested parties in
understanding the application process. A list of these resources can be
found in Appendix A.\1\
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\1\ The FDIC provides resources related to applications for
deposit insurance on its public website. See https://www.fdic.gov/regulations/applications/depositinsurance/index.html.
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Request for Comment
The FDIC seeks comments from interested parties on all aspects of
the deposit insurance application process, including guidance and other
issuances, the steps in the application process, and
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communications with applicants, other interested parties, and the
general public. In addition to any general comments, the FDIC invites
comments in response to the more specific topics and questions
presented below. We encourage commenters to be as specific as possible.
1. What steps, if any, can the FDIC take to improve the de novo
application process?
2. Are there any specific aspects or components of the application
process that particularly discourage potential applicants from
initiating or completing the application process?
3. Are there ways the FDIC could or should update or supplement
existing resources to clarify expectations and promote a more
transparent application process? If so, please provide details and
support.
4. Are there any aspects of the pre-filing process, including with
respect to the newly announced process regarding draft deposit
insurance proposals, that could be modified or enhanced to further
clarify expectations or processes for prospective applicants and
improve applicants' ability to submit a substantially complete
application?
5. How effective is the application form and its related
instructions? Could any elements of the form or instructions be
modified or enhanced to improve applicants' ability to submit a
substantially complete application?
6. Are there any aspects of the field investigation process that
could be improved to better facilitate completion of the application
process?
7. In what ways could or should the FDIC modify the application
process for proposed traditional community banks? How would any
suggested changes impact the evaluation of the statutory factors?
8. In what ways could or should the FDIC modify the application
process for proposed institutions that are not traditional community
banks? How would any suggested changes impact the evaluation of the
statutory factors?
9. Are there ways the FDIC could or should tailor its evaluation of
applications from proposed institutions that are not traditional
community banks, consistent with the statutory factors as described in
the FDIC Statement of Policy on Applications for Deposit Insurance
(SOP)? If so, please explain.
10. Are there ways the FDIC could or should support the continuing
evolution of emerging technology and fintech companies as part of its
application review process? Are there particular risks associated with
any such proposals, and, if so, are there ways such risks could or
should be mitigated?
11. Are the FDIC's expectations (as provided by the FDIC resources
identified in this RFI) regarding capital adequacy and liquidity/
funding for prospective applicants sufficiently clear and
understandable? If not, what additional information or clarifications
could the FDIC provide?
12. Are there legal, regulatory, economic, technological, or other
factors separate from the application process that discourage potential
applicants from submitting applications for deposit insurance that the
FDIC should be aware of? If so, are there steps the FDIC could or
should take to mitigate the impact of such factors?
13. Are there any other suggestions that the FDIC should consider
for improving the effectiveness, efficiency, or transparency of the
application process, or for addressing any other interests or concerns
of stakeholders relative to the application process?
Appendix A--Resources
The following resources are accessible through the FDIC's public
website (https://www.fdic.gov/regulations/applications/resources/).
The resources aid organizers and other interested parties in
understanding the application process.
Part 303 of the FDIC Rules and Regulations, which
outlines procedures for the submission and review of applications,
including applications for deposit insurance.
The Interagency Charter and Federal Deposit Insurance
Application Form, which requests the information the chartering
authority and FDIC need to evaluate the application. The application
form provides general instructions, specific information fields,
supplemental guidelines for business plans, and a template for
financial schedules.
The SOP, which informs the process by which FDIC staff
evaluate the statutory factors described above.
Questions and answers related to the SOP, issued on
November 20, 2014, and on April 6, 2016, to help clarify
expectations for applicants in developing deposit insurance
proposals.
The Deposit Insurance Applications--A Handbook for
Organizers of De Novo Institutions (Handbook), which was issued for
public comment on December 22, 2016, and issued in final form on May
1, 2017. The Handbook is designed to help organizers become familiar
with the deposit insurance application process and the path to
obtaining deposit insurance.
The Deposit Insurance Applications Procedures Manual
(Manual) was issued for public comment on July 10, 2017, and
provides guidance for FDIC staff in the review and processing of
deposit insurance applications. The Manual was issued in final form
on November 1, 2018.
Dated at Washington, DC, on December 6, 2018.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2018-26811 Filed 12-11-18; 8:45 am]
BILLING CODE 6714-01-P