[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