[Federal Register Volume 84, Number 21 (Thursday, January 31, 2019)]
[Proposed Rules]
[Pages 604-612]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28038]
[[Page 604]]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 26
[Docket ID OCC-2018-0011]
RIN 1557-AE22
FEDERAL RESERVE SYSTEM
12 CFR Parts 212 and 238
[Docket No. R-1641]
RIN 7100-AF31
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Part 348
RIN 3064-AE57
Thresholds Increase for the Major Assets Prohibition of the
Depository Institution Management Interlocks Act Rules
AGENCY: Office of the Comptroller of the Currency (OCC); Board of
Governors of the Federal Reserve System (Board); and Federal Deposit
Insurance Corporation (FDIC).
ACTION: Notice of proposed rulemaking and request for public comment.
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SUMMARY: The OCC, the Board, and the FDIC (collectively, the agencies)
are inviting comment on a proposed rule that would increase the major
assets prohibition thresholds for management interlocks in the
agencies' rules implementing the Depository Institution Management
Interlocks Act (DIMIA). The DIMIA major assets prohibition prohibits a
management official of a depository organization with total assets
exceeding $2.5 billion (or any affiliate of such an organization) from
serving at the same time as a management official of an unaffiliated
depository organization with total assets exceeding $1.5 billion (or
any affiliate of such an organization). DIMIA provides that the
agencies may adjust, by regulation, the major assets prohibition
thresholds in order to allow for inflation or market changes. The
agencies propose to raise the major assets prohibition thresholds to
$10 billion to account for changes in the United States banking market
since the current thresholds were established in 1996. The agencies
also propose three alternative approaches for increasing the thresholds
based on market changes or inflation. Increasing the major assets
prohibition thresholds would relieve certain depository organizations
below the adjusted thresholds from having to ask the agencies for an
exemption from the major assets prohibition. The agencies do not expect
the proposal to materially increase anticompetitive risk.
DATES: Comments must be received on or before April 1, 2019.
ADDRESSES: Comments should be directed to:
OCC: Because paper mail in the Washington, DC area and at the OCC
is subject to delay, commenters are encouraged to submit comments
through the Federal eRulemaking Portal or email, if possible. Please
use the title ``Thresholds Increase for the Major Assets Prohibition of
the Depository Institution Management Interlocks Act Rules'' to
facilitate the organization and distribution of the comments. You may
submit comments by any of the following methods:
Federal eRulemaking Portal--``Regulations.gov'': Go to
www.regulations.gov. Enter ``Docket ID OCC-201X-0011'' in the Search
box and click ``Search.'' Click on ``Comment Now'' to submit public
comments.
Click on the ``Help'' tab on the Regulations.gov home page
to get information on using Regulations.gov, including instructions for
submitting public comments.
Email: [email protected].
Mail: Legislative and Regulatory Activities Division,
Office of the Comptroller of the Currency, 400 7th Street SW, Suite 3E-
218, Washington, DC 20219.
Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
Fax: (571) 465-4326.
Instructions: You must include ``OCC'' as the agency name and
``Docket ID OCC-201X-0011'' in your comment. In general, OCC will enter
all comments received into the docket and publish the comments on the
Regulations.gov website without change, including any business or
personal information that you provide such as name and address
information, email addresses, or phone numbers. Comments received,
including attachments and other supporting materials, are part of the
public record and subject to public disclosure. Do not include any
information in your comment or supporting materials that you consider
confidential or inappropriate for public disclosure.
You may review comments and other related materials that pertain to
this rulemaking action by any of the following methods:
Viewing Comments Electronically: Go to
www.regulations.gov. Enter ``Docket ID OCC-201X-0011'' in the Search
box and click ``Search.'' Click on ``Open Docket Folder'' on the right
side of the screen. Comments and supporting materials can be viewed and
filtered by clicking on ``View all documents and comments in this
docket'' and then using the filtering tools on the left side of the
screen.
Click on the ``Help'' tab on the Regulations.gov home page
to get information on using Regulations.gov. The docket may be viewed
after the close of the comment period in the same manner as during the
comment period.
Viewing Comments Personally: You may personally inspect
comments at the OCC, 400 7th Street SW, Washington, DC 20219. For
security reasons, the OCC requires that visitors make an appointment to
inspect comments. You may do so by calling (202) 649-6700 or, for
persons who are deaf or hearing-impaired, TTY, (202) 649-5597. Upon
arrival, visitors will be required to present valid government-issued
photo identification and submit to security screening in order to
inspect comments.
Board: When submitting comments, please consider submitting your
comments by email or fax because paper mail in the Washington, DC area
and at the Board may be subject to delay. You may submit comments,
identified by Docket No. R-1641 and RIN 7100-AF31, by any of the
following methods:
Agency Website: http://www.federalreserve.gov. Follow the
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Email: [email protected]. Include docket
number in the subject line of the message.
FAX: (202) 452-3819 or (202) 452-3102.
Mail: Ann E. Misback, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue NW,
Washington, DC 20551.
All public comments will be made available on the Board's website
at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as
submitted, unless modified for technical reasons or to remove
personally identifiable information at the commenter's request.
Otherwise, comments will not be edited to remove any identifying or
contact information. Public comments also may be viewed electronically
or in paper in Room 3515, 1801 K Street NW (between 18th and 19th
Streets NW), between 9:00 a.m. and 5:00 p.m. on weekdays.
FDIC: You may submit comments, identified by RIN 3064-AE57, by any
of the following methods:
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Agency Website: https://www.fdic.gov/regulations/laws/federal/. Follow instructions for submitting comments on the Agency
website.
Email: [email protected]. Include the RIN 3064-AE57 on 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 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-AE57 for this rulemaking. All comments received will be
posted without change to https://www.fdic.gov/regulations/laws/federal/
, including any personal information provided. Paper copies of public
comments may be ordered from the FDIC Public Information Center, 3501
North Fairfax Drive, Room E-1002, Arlington, VA 22226 by telephone at
(877) 275-3342 or (703) 562-2200.
FOR FURTHER INFORMATION CONTACT:
OCC: Daniel Perez, Attorney, Christopher Rafferty, Attorney, Chief
Counsel's Office, (202) 649-5490; or for persons who are deaf or
hearing-impaired, TTY, (202) 649-5597; Office of the Comptroller of the
Currency, 400 7th Street SW, Washington, DC 20219.
Board: Michelle Kidd, Senior Counsel, (202) 736-5554; Claudia Von
Pervieux, Senior Counsel, (202) 452-2552; or Andrew Hartlage, Counsel,
(202) 452-6483, of the Legal Division; Katie Cox, Manager, (202) 452-
2721; or Melissa Clark, Senior Supervisory Financial Analyst, (202)
452-2277, of the Division of Supervision and Regulation, Board of
Governors of the Federal Reserve System, 20th Street and Constitution
Avenue NW, Washington, DC 20551. For the hearing impaired only,
Telecommunication Device for the Deaf, (202) 263-4869, Board of
Governors of the Federal Reserve System, 20th Street and Constitution
Avenue NW, Washington, DC 20551.
FDIC: Karen J. Currie, Senior Examination Specialist, Division of
Risk Management Supervision, (202) 898-3981; Mark Mellon, Counsel,
Legal Division, (202) 898-3884; Federal Deposit Insurance Corporation,
550 17th Street NW, Washington, DC 20429.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Introduction
A. Summary of Proposed Rule and Policy Objectives
B. Background
II. Description of Proposed Rule
A. Proposal To Increase Asset Thresholds to $10 Billion
B. Expected Impact
C. Future Adjustments to the Thresholds
III. Alternative Approaches To Adjust the Asset Thresholds
A. Thresholds Adjustment Based on Percentage of the Number of
Banking Organizations Covered by Prohibition
B. Thresholds Adjustment Based on Asset Growth
C. Thresholds Adjustment Increased Based on Inflation
IV. FDIC Technical Amendments
V. Request for Comment
VI. Regulatory Analysis
I. Introduction
A. Summary of Proposed Rule and Policy Objectives
The Office of the Comptroller of the Currency (OCC), the Board of
Governors of the Federal Reserve System (Board), and the Federal
Deposit Insurance Corporation (FDIC) (collectively, the agencies) are
inviting comment on a notice of proposed rulemaking (proposed rule or
proposal) that would increase the major assets prohibition thresholds
for management interlocks in the agencies' rules implementing the
Depository Institution Management Interlocks Act (DIMIA).\1\ The
proposed increase in the thresholds would account for changes in the
United States banking market since Congress established the current
thresholds in 1996. Under the major assets prohibition of the current
rules, a management official \2\ of a depository organization \3\ (or
any affiliate of such organization) with total assets exceeding $2.5
billion may not serve as a management official of an unaffiliated
depository organization (or any affiliate of such organization) with
total assets exceeding $1.5 billion without seeking an exemption. The
proposed rule would increase both thresholds to $10 billion.
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\1\ 12 U.S.C. 3201 et seq.
\2\ In the agencies' rules, ``management official'' is defined
to include directors; advisory or honorary directors of a depository
institution with total assets of $100 million or more; ``senior
executive officers,'' as that term is defined in the agencies' rules
regarding notice of addition or change of directors and senior
executive officers; branch managers; trustees of depository
organizations under the control of trustees; and any persons who
have a representative or nominee as defined in the agencies' rules
on management interlocks, serving in any of the capacities described
above. 12 CFR 26.2(j)(1) (OCC); 12 CFR 212.2(j)(1) and 238.92(j)(1)
(Board); and 12 CFR 348.2(k)(1) (FDIC).
\3\ In the agencies' rules, the term ``depository organization''
means a depository institution or a depository holding company.
``Depository institution'' means a commercial bank (including a
private bank), a savings bank, a trust company, a savings and loan
association, a building and loan association, a homestead
association, a cooperative bank, an industrial bank, or a credit
union, chartered under the laws of the United States and having a
principal office located in the United States. Additionally, a
United States office of a foreign commercial bank, including a
branch or agency, is a depository institution. ``Depository holding
company'' means a bank holding company or a savings and loan holding
company (as more fully defined in section 202 of the Interlocks Act
(12 U.S.C. 3201)) having its principal office located in the United
States. 12 CFR 26.2 (OCC); 12 CFR 212.2 and 238.92 (Board); and 12
CFR 348.2 (FDIC).
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In addition, the agencies are proposing three alternative
approaches for increasing the asset thresholds, described below.
By increasing the major assets prohibition thresholds, the proposed
rule and proposed alternative approaches would reduce the number of
depository organizations subject to the major assets prohibition and
reduce burden by relieving depository organizations below the increased
thresholds from having to ask the agencies for an exemption from the
major assets prohibition. The agencies anticipate that raising the
thresholds will facilitate small depository organizations in finding
qualified directors by eliminating the need to file a request for an
exemption from the major assets prohibition.
B. Background
DIMIA--implemented through the agencies' rules at 12 CFR parts 26,
212, 238 subpart J, and 348--fosters competition by prohibiting a
management official from serving at the same time as a management
official of an unaffiliated depository organization in situations where
the management interlock may have an anticompetitive effect.\4\ DIMIA
and the agencies' rules achieve this purpose through three
restrictions.
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\4\ 12 CFR 26.1(b) (OCC); 12 CFR 212.1(b) and 238.91(b) (Board);
and 12 CFR 348.1(b) (FDIC).
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The first, the community prohibition, prohibits a management
official of a depository organization from serving at the same time as
a management official of an unaffiliated depository organization if the
involved depository organizations (or a depository institution
affiliate thereof) have offices in the same community.\5\ The second,
the relevant metropolitan statistical area (RMSA) prohibition,
prohibits a management official of a depository organization from
serving at the same time as a management official of an unaffiliated
depository organization if the involved depository organizations (or a
depository institution affiliate thereof) have offices in the same
[[Page 606]]
RMSA \6\ and each depository organization has total assets of $50
million or more. The third, the major assets prohibition, prohibits a
management official of a depository organization with total assets
exceeding $2.5 billion (or any affiliate of such an organization) from
serving at the same time as a management official of an unaffiliated
depository organization with total assets exceeding $1.5 billion (or
any affiliate of such an organization), regardless of the location of
the two depository organizations. While the first two prohibitions
capture the risk of anticompetitive effects from management interlocks
between depository organizations that operate within overlapping
geographical areas, the major assets prohibition addresses management
interlocks between depository organizations that are large enough that
a management interlock may present anticompetitive concerns despite the
fact that the involved organizations may not have offices in the same
community or RMSA.
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\5\ In the agencies' rules, ``community'' means a city, town, or
village, and contiguous and adjacent cities, towns, or villages. 12
CFR 26.2(c) (OCC); 12 CFR 212.2(c) and 238.92(c) (Board); and 12 CFR
348.2(c) (FDIC).
\6\ In the agencies' rules, ``RMSA'' means an MSA, a primary
MSA, or a consolidated MSA that is not comprised of designated
Primary MSAs to the extent that these terms are defined and applied
by the Office of Management and Budget. 12 CFR 26.2(m) (OCC); 12 CFR
212.2(m) and 238.92(m) (Board); and 12 CFR 348.2(c) (FDIC).
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DIMIA allows the agencies to prescribe regulations that permit
otherwise prohibited interlocks under certain circumstances.\7\
Pursuant to the general exemption provision of the agencies'
regulations, the appropriate agency may exempt a prohibited interlock
in response to an application by a depository organization if the
appropriate agency finds that the interlock would not result in a
monopoly or substantial lessening of competition and would not present
safety and soundness concerns.\8\
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\7\ 12 U.S.C. 3207.
\8\ 12 CFR 26.6(a) (OCC); 12 CFR 212.6(a) and 238.96(a) (Board);
and 12 CFR 348.6(a) (FDIC). The agencies have published an
interagency interpretation that explains which agency is the
appropriate agency for purposes of filing a request for a general
exemption under the agencies' rules. See Permissible Interlocks--
Regulatory Exceptions; Agency Approval, 1 Fed. Res. Reg. Serv. (Bd.
of Governors of the Fed. Reserve Sys.) Sec. 3-831 (Nov. 18, 1992),
2006 WL 3928616.
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The $1.5 billion and $2.5 billion thresholds for the DIMIA major
assets prohibition were enacted through amendments to DIMIA in the
Economic Growth and Regulatory Paperwork Reduction Act of 1996
(EGRPRA).\9\ During hearings for EGRPRA, it was noted that the increase
of the asset thresholds to $1.5 billion and $2.5 billion was made
because the previous asset threshold numbers did not ``realistically
reflect the size of large institutions in today's market.'' \10\
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\9\ See Economic Growth and Regulatory Paperwork Reduction Act
of 1996, Pub. L. 104-208, Title II, 110 Stat. 3009-9, Sec. 2210(a).
\10\ The Economic Growth and Regulatory Paperwork Reduction
Act--S. 650: Hearings Before the Subcomm. on Fin. Insts. and
Regulatory Relief of the S. Comm. on Banking, Hous., & Urban
Affairs, 104 Cong. 90 (1995) (statement of Eugene A. Ludwig,
Comptroller of the Currency).
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DIMIA, as amended, provides that the agencies may adjust the
thresholds as necessary ``to allow for inflation or market changes.''
\11\ The current major assets thresholds have not been adjusted since
1996, do not reflect the growth and consolidation among U.S. depository
organizations that has occurred in the intervening years, and do not
realistically reflect the size of large institutions in today's market.
For instance, total assets at depository organizations have grown
nearly 250 percent between the fourth quarter of 1996 and the fourth
quarter of 2017. Moreover, in a March 2017 report to Congress mandated
by EGRPRA, the agencies committed to reducing regulatory burden by
adjusting the major assets thresholds in the agencies' DIMIA
regulations.\12\
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\11\ 12 U.S.C. 3203.
\12\ Federal Financial Institutions Examination Council, Joint
Report to Congress: Economic Growth and Regulatory Paperwork
Reduction Act, 82 FR 15900, 15903 (Mar. 30, 2017), https://www.ffiec.gov/pdf/2017_FFIEC_EGRPRA_Joint-Report_to_Congress.pdf.
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II. Description of Proposed Rule
A. Proposal To Increase Asset Thresholds to $10 Billion
The agencies are proposing to raise the major assets prohibition
thresholds from $1.5 billion and $2.5 billion to $10 billion each. As
proposed, the major assets prohibition would restrict management
interlocks between unaffiliated depository organizations with total
assets exceeding $10 billion (or any affiliates of such organizations).
The proposed threshold increase, and applying the major assets
prohibition to larger depository organizations rather than small
institutions (i.e., community banks), is consistent with the purpose of
DIMIA.\13\ A $10 billion major assets prohibition threshold would
prohibit interlocks between larger depository organizations, which
could present a risk of anticompetitive conduct at the national banking
market level, while exempting smaller or community-banking-
organization-sized depository organizations, which do not present the
same competitive risks at the national banking market level.
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\13\ Legislative history indicates that Congress intended for
the major assets prohibition to apply to ``larger'' organizations.
See H.R. Rep. No. 95-1383, at 5 (1978); S. Rep. No. 95-323, at 13
(1977).
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In addition, the proposal is consistent with the current thresholds
that Congress and the agencies have used to distinguish between small
institutions and larger institutions. For example, section 201 and 203
of the Economic Growth, Regulatory Relief, and Consumer Protection Act
provide certain procedural burden relief for institutions with less
than $10 billion in total consolidated assets.\14\ Additionally, the
Dodd-Frank Wall Street Reform and Consumer Protection Act uses a $10
billion threshold to distinguish between large banks subject to
supervision by the Bureau of Consumer Financial Protection and small
banks subject to prudential regulator supervision.\15\ A $10 billion
threshold also is consistent with the asset threshold used by the Board
to distinguish between community banking organizations and larger
banking organizations for supervisory and regulatory purposes,\16\ the
asset threshold used by the FDIC to distinguish between ``small'' and
``large'' institutions for purposes of its assessment regulations,\17\
and the asset threshold used by the OCC to distinguish community banks
from midsize and large banks.\18\
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\14\ Economic Growth, Regulatory Relief, and Consumer Protection
Act, Public Law 115-174, Sec. 201, 203, 132 Stat. 1296, 1306, 1309
(2018) (enacting a ``Community Bank Leverage Ratio'' capital
simplification framework that is generally available to depository
institutions and depository institution holding companies with $10
billion or less in total consolidated assets and exempting generally
from the prohibitions of section 13 of the Bank Holding Company Act
of 1956, also known as the ``Volcker Rule,'' certain entities with
$10 billion or less in total consolidated assets).
\15\ Public Law 111-203, Sec. 1025 & 1026, 124 Stat. 1376,
1990-95 (2010).
\16\ Bd. of Governors of the Fed. Reserve Sys., Commercial Bank
Examination Manual (rev. Jan. 2018), https://www.federalreserve.gov/publications/files/cbem.pdf.
\17\ See 12 CFR 327.8(e) and (f). For the purposes of the FDIC's
assessment regulations, a ``small institution'' generally is an
insured depository institution with less than $10 billion in total
assets. Generally, a ``large institution'' is an insured depository
institution with more than $10 billion in total assets or that is
treated as a large institution for assessment purposes under section
327.16(f).
\18\ Comptroller's Handbook, ``OCC Community Bank Supervision''
(June 2018), https://www.occ.gov/publications/publications-by-type/comptrollers-handbook/community-bank-supervision/pub-ch-community-bank-supervision.pdf.
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Further, having a single, consistent asset threshold would simplify
the agencies' DIMIA regulations and enable depository organizations to
identify more easily whether they may be subject to the major assets
prohibition.
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B. Expected Impact
The proposed rule would increase the number of depository
organizations that would no longer be subject to the major assets
prohibition and therefore reduce the number of institutions that need
to seek an exemption from the major assets prohibition from the
appropriate agency.
As of December 31, 2017, 1,021 depository organizations had total
assets of more than $1.5 billion and were subject to the major assets
prohibition.\19\ In addition, 698 depository organizations with total
assets of more than the $2.5 billion threshold were subject to
restrictions on management interlocks with unaffiliated depository
organizations with total assets exceeding the $1.5 billion threshold.
If the agencies raise the $1.5 billion asset threshold to $10 billion,
they would exempt 764 depository organizations from the major assets
prohibition as of December 31, 2017. Of these 764 depository
organizations, 224 are FDIC-supervised depository institutions, 113 are
OCC-supervised depository institutions, 91 are Board-supervised
depository institutions, and 336 are Board-supervised depository
holding companies. As of December 31, 2017, 257 depository
organizations reported total assets greater than $10 billion and would
remain subject to the major assets prohibition.
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\19\ The analysis in this preamble reflecting changes in the
number of depository organizations exempted does not incorporate
credit unions because this proposed rule does not apply to credit
unions. Data used in this analysis were drawn from the December 31,
1996, and December 31, 2017, Consolidated Reports of Condition and
Income (Call Reports), Consolidated Financial Statements for Holding
Companies, Parent Company Only Financial Statements for Large
Holding Companies, Parent Company Only Financial Statements for
Small Holding Companies, and Reports of Assets and Liabilities of
U.S. Branches and Agencies of Foreign Banks.
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Increasing the thresholds of the major assets prohibition would
allow smaller depository organizations to form management interlocks
with other smaller depository organizations and would relieve the
depository organization seeking to add a management official from the
associated burden of seeking a general exemption from the appropriate
agency with respect to such a management interlock (unless the
interlock would be prohibited by the community or RMSA prohibitions).
The agencies believe that with fewer depository organizations subject
to the major assets prohibition thresholds, the proposed rule would
expand the pool of available management officials for smaller
depository organizations no longer covered by the major assets
prohibition.
The agencies do not expect the proposal to materially increase
anticompetitive risk. The increase to the major assets prohibition
thresholds is insufficient to materially increase the risk of
anticompetitive interlocks between depository organizations at the
national banking market level, and the proposal does not affect DIMIA
prohibitions against interlocks within overlapping geographical areas.
C. Future Adjustments to the Thresholds
Following adjustment of the thresholds by this proposed rule, if
adopted, the agencies would make further adjustments to the thresholds
to account for inflation through direct final rule without notice and
comment pursuant to 12 CFR 26.3(c), 212.3(c), 238.93(c), and 348.3(c).
If the agencies determine that further adjustments to the thresholds
are warranted for reasons other than inflation, the agencies then would
propose another adjustment through a subsequent notice of proposed
rulemaking with the opportunity to comment.
III. Alternative Approaches To Adjust the Asset Thresholds
As described above, in order to account for market changes since
the agencies' DIMIA regulations were last updated, the agencies propose
to increase the major assets prohibition thresholds to $10 billion. The
agencies also invite comment on three alternative approaches discussed
below. Consistent with the agencies' authority under DIMIA, two of the
alternative approaches, like the proposed approach, are based on market
changes, and the third alternative approach is based on inflation.\20\
Because the proposal and the alternative approaches all would raise the
major assets prohibition thresholds, the agencies expect that the
impact for each proposal would be similar (i.e., each approach would
result in a greater number of depository organizations exempted from
the major assets prohibition), varying only in the degree of the impact
(i.e., the number of depository organizations exempted).
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\20\ See 12 U.S.C. 3203.
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A. Thresholds Adjustment Based on Percentage of the Number of Banking
Organizations Covered by Prohibition
Under the first alternative approach, the agencies would adjust the
major assets prohibition thresholds so that approximately the same
percentage of the total number of banking organizations \21\ that were
covered by the thresholds as of the fourth quarter of 1996--the year in
which the $1.5 billion and $2.5 billion major assets prohibition
thresholds were established by statute--would be covered as of fourth
quarter 2017. By adjusting the major assets prohibition thresholds so
that they cover the same percentage of the total number of banking
organizations as was covered in 1996, this alternative approach
accounts for changes in the U.S. banking market and seeks to maintain
the prohibition's initial scope and impact--which was limited to only
relatively large depository organizations--as well as the protections
it provides against anticompetitive risk. This approach would increase
the current thresholds of $1.5 billion and $2.5 billion to $7.9 billion
and $11.8 billion, respectively.
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\21\ The agencies' analysis, and resulting percentages and
thresholds, for this approach relies on ``banking organizations''
instead of ``depository organizations'' to avoid double-counting the
assets of depository institutions held by depository holding
companies that reported consolidated holding company assets. As used
here, the term ``banking organization'' includes all depository
holding companies, as defined by the agencies' DIMIA regulations,
that reported consolidated assets greater than zero and all
depository institutions, as defined by the agencies' DIMIA
regulations, with reported assets greater than zero that are not
consolidated under a holding company.
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As of the fourth quarter of 1996, the major assets prohibition
thresholds covered the top 1.9 percent and 1.3 percent of banking
organizations by asset size. By the fourth quarter of 2017, the
percentage of banking organizations covered by the thresholds had
increased to 6.83 percent and 4.44 percent. Adjusting the major assets
prohibition thresholds to account for this market change would result
in adjusted asset thresholds of $7.9 billion and $11.8 billion.
Raising the current $1.5 billion threshold to $7.9 billion would
result in an additional 702 depository organizations being exempted
from the major assets prohibition. Of these 702 depository
organizations, 207 are FDIC-supervised depository institutions, 102 are
OCC-supervised depository institutions, 82 are Board-supervised
depository institutions, and 311 are Board-supervised depository
holding companies. As of December 31, 2017, 78 depository organizations
reported total assets greater than $7.9 billion but less than $11.8
billion. Finally, 241 depository organizations reported total assets
greater than $11.8 billion and would remain subject to the major assets
prohibition.
[[Page 608]]
B. Thresholds Adjustment Based on Asset Growth
Under this second alternative approach, the agencies would propose
to adjust the major assets prohibition thresholds to reflect the rate
of asset growth for depository organizations over the period between
the fourth quarter of 1996 and the fourth quarter of 2017. This
approach seeks to replicate the major assets prohibition's coverage of
the 1996 banking market by using total asset growth as a measure of
market change. Total assets at depository organizations have grown by
$15.6 trillion between the fourth quarter of 1996 and the fourth
quarter of 2017. This growth represents an increase of three and one-
half times the amount of total assets in the fourth quarter of 1996.
Under this approach, the current major assets prohibition thresholds
would be multiplied by the aforementioned rate of asset growth (3.5) to
account for market changes for depository organizations. As a result,
the current assets thresholds would be raised from $1.5 billion and
$2.5 billion to $5.3 billion and $8.8 billion, respectively.
Raising the $1.5 billion asset threshold to $5.3 billion would
result in an additional 616 depository organizations being exempted
from the major assets prohibition. Of these 616 depository
organizations, 182 are FDIC-supervised depository institutions, 89 are
OCC-supervised depository institutions, 74 are Board-supervised
depository institutions, and 271 are Board-supervised depository
holding companies. As of December 31, 2017, 109 depository
organizations reported total assets greater than $5.3 billion, but less
than $8.8 billion. Finally, 296 depository organizations reported total
assets greater than $8.8 billion and would remain subject to the major
assets prohibition.
C. Thresholds Adjustment Increased Based on Inflation
Under the third alternative approach, the agencies would adjust the
major assets prohibition thresholds based on the year-to-year change in
the average of the Consumer Price Index for Urban Wage Earners and
Clerical Workers (CPI-W). Adjusting the asset thresholds based on
inflation from the fourth quarter of 1996 to the fourth quarter of 2017
would increase the major assets prohibition thresholds from $1.5
billion and $2.5 billion to $2.3 billion and $3.9 billion,
respectively. Although the agencies' current rules allow an adjustment
for inflation based on the CPI-W to be published as a final rule
without notice and comment, the agencies believe it is appropriate to
seek comment on an inflation-based approach given the length of time
that has passed without change to the thresholds and given the extent
to which the banking market has changed during that time.
Raising the $1.5 billion asset threshold to $2.3 billion would
exempt an additional 288 depository organizations from the major assets
prohibition. Of these 288 depository organizations, 83 are FDIC-
supervised depository institutions, 45 are OCC-supervised depository
institutions, 36 are Board-supervised depository institutions, and 124
are Board-supervised depository holding companies. As of December 31,
2017, 219 depository organizations reported total assets greater than
$2.3 billion but less than $3.9 billion. Finally, 514 depository
organizations reported total assets greater than $3.9 billion and would
remain subject to the major assets prohibition.
IV. FDIC Technical Amendments
In addition to the proposed adjustment of the thresholds for the
major assets prohibition, the FDIC intends to make two purely technical
corrections to FDIC regulations, both pertaining to DIMIA
implementation, by means of a separate final rule without notice and
comment. The first correction pertains to 12 CFR 303.249 and would
remove an erroneous statement. The second pertains to 12 CFR 348.4(i)
and would correct a citation. Both technical corrections will be
explained in further detail in the FDIC final rule.
V. Request for Comment
The agencies invite comment on all aspects of this proposal,
including the specific questions enumerated below.
Question 1: Are depository organizations the appropriate unit for
measuring market change for purposes of the agencies' proposal? In
addition, are banking organizations the appropriate unit for measuring
market change for purposes of the agencies' alternative approach based
on the percentage of the number of banking organizations covered by the
prohibition? For all of the proposed approaches, would another unit of
measurement be more appropriate? If so, what unit of measurement and
why?
Question 2: Is the proposed $10 billion asset threshold appropriate
to carry out the purposes of the major assets prohibition? Would one of
the other alternative approaches proposed to adjust the thresholds be
more appropriate to meet the purposes of the major assets prohibition?
Would some other dollar amount, or some combination of asset thresholds
or factors, be more appropriate? If so, what threshold, factor, or
combination thereof would be appropriate, and why?
Question 3: Is the measurement period of the fourth quarter of 1996
through the fourth quarter of 2017, as used in the agencies'
alternative approaches, appropriate for purposes of measuring market
change? Should the agencies shorten or extend this measurement period?
If so, why?
Question 4: Are there any other approaches to adjusting the major
assets prohibition thresholds that would be more appropriate than the
approaches proposed by the agencies? If so, what approach would be more
appropriate and why?
VI. Regulatory Analysis
A. Paperwork Reduction Act of 1995
Certain provisions of the proposed rule contain ``collection of
information'' requirements within the meaning of the Paperwork
Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521). In accordance with
the requirements of the PRA, the agencies may not conduct or sponsor,
and the respondent is not required to respond to, an information
collection unless it displays a currently valid Office of Management
and Budget (OMB) control number. The OMB control number for the OCC is
1557-0014; the Board's is 7100-0134; and the FDIC's is 3064-0118. These
information collections will be extended for three years, with
revision. The information collection requirements contained in this
proposed rulemaking have been submitted by the OCC and FDIC to OMB for
review and approval under section 3507(d) of the PRA (44 U.S.C.
3507(d)) and section 1320.11 of the OMB's implementing regulations (5
CFR 1320). The Board reviewed the proposed rule under the authority
delegated to the Board by OMB.
Comments are invited on:
a. Whether the collections of information are necessary for the
proper performance of the agencies' functions, including whether the
information has practical utility;
b. The accuracy or the estimate of the burden of the information
collections, including the validity of the methodology and assumptions
used;
c. Ways to enhance the quality, utility, and clarity of the
information to be collected;
d. Ways to minimize the burden of the information collections on
respondents, including through the use of automated collection
techniques or other forms of information technology; and
[[Page 609]]
e. Estimates of capital or startup costs and costs of operation,
maintenance, and purchase of services to provide information.
All comments will become a matter of public record. Comments on
aspects of this notice that may affect reporting, recordkeeping, or
disclosure requirements and burden estimates should be sent to the
addresses listed in the ADDRESSES section of this document. A copy of
the comments may also be submitted to the OMB desk officer by mail to
U.S. Office of Management and Budget, 725 17th Street NW, #10235,
Washington, DC 20503; facsimile to (202) 395-6974; or email to
[email protected], Attention, Federal Banking Agency Desk
Officer.
Proposed Information Collection
Title of Information Collection: Management Official Interlocks.
Frequency: Annual, event driven.
Affected Public: Businesses or other for-profit.
Respondents
OCC: National banks, Federal savings associations, and U.S. offices
of foreign commercial banks, including Federal branches and agencies.
Board: State member banks (SMBs), bank holding companies (BHCs),
savings and loan holding companies (SLHCs), and their affiliates; and
U.S. offices of foreign commercial banks, including state-licensed
branches and agencies.
FDIC: State nonmember banks, state savings associations, and
certain subsidiaries of those entities; and U.S. offices of foreign
commercial banks, including insured branches and agencies.
Current Actions: The proposed rule would revise section __.3,
``Prohibitions,'' of the agencies' DIMIA rules \22\ by increasing the
major asset prohibition thresholds from $2.5 billion and $1.5 billion
to $10 billion each. Section __.6, ``General Exemption,'' \23\ contains
a process for applying for an exemption from the prohibitions in
section __.3. With the increase in the major assets prohibition
thresholds in section __.3, it is likely that fewer applications will
be filed under section __.6. Therefore, the agencies have reduced their
respondent counts for section __.6 accordingly. Also, in order to be
consistent across the agencies, the agencies are applying a conforming
methodology for calculating the burden estimates for the reporting and
recordkeeping requirements.
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\22\ See 12 CFR 26.3 (OCC); 12 CFR 212.3 and 238.3 (Board); 12
CFR 348.3 (FDIC).
\23\ See 12 CFR 26.6 (OCC); 12 CFR 212.6 and 238.6 (Board); 12
CFR 348.6 (FDIC).
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PRA Burden Estimates
OCC
OMB control number: 1557-0014.
Estimated number of respondents: 2.
Estimated average hours per response:
Reporting Sections 26.4(h)(1)(i) and 26.6(b)--4.
Recordkeeping Section 26.5(b)--3.
Estimated annual burden hours: 14.
Board
OMB control number: 7100-NEW (The current management official
interlocks reporting and recordkeeping requirements are housed under
OMB control number 7100-0134 and will be separated out in a new OMB
control number).
Estimated number of respondents: 4.
Estimated average hours per response:
Reporting Sections 212.4(h)(1)(i) and 212.6(b)--4.
Recordkeeping Section 212.5(b)--3.
Estimated annual burden hours: 28.
FDIC
OMB control number: 3064-0118.
Estimated number of respondents: 6.
Estimated average hours per response:
Reporting Sections 348.4(h)(1)(i) and 348.6(b)--4.
Recordkeeping Section 348.5(b)--3.
Estimated annual burden hours: 42.
B. Regulatory Flexibility Act
In general, the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et
seq.) requires that in connection with a rulemaking, an agency prepare
and make available for public comment a regulatory flexibility analysis
that describes the impact of the rule on small entities. The SBA has
defined ``small entities'' to include certain organizations with total
assets less than or equal to $550 million.\24\ Under 5 U.S.C. 605(b),
this analysis is not required if an agency certifies that the rule will
not have a significant economic impact on a substantial number of small
entities and publishes its certification and a brief explanatory
statement in the Federal Register along with its rule.
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\24\ 13 CFR 121.201.
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OCC: The OCC currently supervises approximately 886 small
entities.\25\ Because the major assets prohibition of DIMIA prevents a
management official of a depository organization with total assets
exceeding $2.5 billion (depository organization threshold) or any
affiliate of such organization from serving as a management official of
an unaffiliated depository organization with total assets exceeding
$1.5 billion (unaffiliated organization threshold) it is unlikely to
affect any OCC-supervised small institutions. Therefore, the OCC
certifies that the proposed rule would not have a significant economic
impact on a substantial number of OCC-supervised small entities.
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\25\ The OCC bases its estimate of the number of small entities
on the SBA's size thresholds for commercial banks and savings
institutions, and trust companies, which are $550 million and $38.5
million, respectively. Consistent with the General Principles of
Affiliation 13 CFR 121.103(a), the OCC counts the assets of
affiliated financial institutions when determining if it should
classify an OCC-supervised institution as a small entity. The OCC
uses December 31, 2017, to determine size because a ``financial
institution's assets are determined by averaging the assets reported
on its four quarterly financial statements for the preceding year.''
See footnote 8 of the U.S. Small Business Administration's Table of
Size Standards.
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Board: The Board is providing an initial regulatory flexibility
analysis with respect to this proposed rule. The Regulatory Flexibility
Act, 5 U.S.C. 601 et seq. (RFA), requires an agency to consider whether
the rules it proposes will have a significant economic impact on a
substantial number of small entities. In connection with a proposed
rule, the RFA requires an agency to prepare an Initial Regulatory
Flexibility Analysis describing the impact of the rule on small
entities or to certify that the proposed rule would not have a
significant economic impact on a substantial number of small entities.
An initial regulatory flexibility analysis must contain (1) a
description of the reasons why action by the agency is being
considered; (2) a succinct statement of the objectives of, and legal
basis for, the proposed rule; (3) a description of, and, where
feasible, an estimate of the number of small entities to which the
proposed rule will apply; (4) a description of the projected reporting,
recordkeeping, and other compliance requirements of the proposed rule,
including an estimate of the classes of small entities that will be
subject to the requirement and the type of professional skills
necessary for preparation of the report or record; (5) an
identification, to the extent practicable, of all relevant Federal
rules which may duplicate, overlap with, or conflict with the proposed
rule; and (6) a description of any significant alternatives to the
proposed rule which accomplish its stated objectives.\26\
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\26\ 5 U.S.C. 603.
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The Board has considered the potential impact of the proposed rule
on small entities in accordance with the RFA. Based on its analysis and
for the reasons stated below, the Board believes that this proposed
rule will not have a significant economic impact on a
[[Page 610]]
substantial number of small entities. Nevertheless, the Board is
publishing and inviting comment on this initial regulatory flexibility
analysis. A final regulatory flexibility analysis will be conducted
after comments received during the public comment period have been
considered.
1. Reasons for the Proposal
As discussed in the Supplementary Information, the proposed rule
would adjust the major assets prohibition thresholds for management
interlocks in the Board's rules implementing DIMIA. Under the current
major assets prohibition, a management official of a depository
organization with total assets exceeding $2.5 billion (or any affiliate
of such an organization) from serving at the same time as a management
official of an unaffiliated depository organization with total assets
exceeding $1.5 billion (or any affiliate of such an organization),
regardless of the location of the two depository organizations. For
these purposes, the term ``depository organization'' means a depository
institution or a depository holding company. ``Depository institution''
means a commercial bank (including a private bank), a savings bank, a
trust company, a savings and loan association, a building and loan
association, a homestead association, a cooperative bank, an industrial
bank, or a credit union, chartered under the laws of the United States
and having a principal office located in the United States.
Additionally, a United States office, including a branch or agency, of
a foreign commercial bank is a depository institution. ``Depository
holding company'' means a bank holding company or a savings and loan
holding company (as more fully defined in section 202 of DIMIA) having
its principal office located in the United States.\27\ The primary
benefit of the proposed rule would be to exclude from the major assets
prohibition management interlocks involving depository organizations
with total assets in excess of the current asset thresholds but below
the proposed asset thresholds. Raising the thresholds will help to
facilitate small banks in finding qualified directors by eliminating
the need to file a request for an exemption from the major assets
prohibition.
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\27\ 12 CFR 212.2 and 231.92.
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2. Statement of Objectives and Legal Basis
As discussed above, the Board's objective in proposing this rule
would be to reduce the number of depository organizations subject to
the major assets prohibition. The Board has authority under DIMIA to
prescribe regulations to carry out DIMIA with respect to state banks
that are members of the Federal Reserve System, bank holding companies,
and savings and loan holding companies.\28\
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\28\ 12 U.S.C. 3207(2).
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3. Description of Small Entities To Which the Regulation Applies
The Board's proposal would apply to state member banks, bank
holding companies, and savings and loan holding companies having their
principal offices in the United States. Under regulations issued by the
Small Business Administration, a small entity includes a depository
institution, bank holding company, or savings and loan holding company
with total assets of $550 million or less and trust companies with
total assets of $38.5 million or less. As of June 30, 2018, there were
approximately 3,053 small bank holding companies, 184 small savings and
loan holding companies, and 541 small state member banks. The proposed
rule would increase the total asset level at which depository
organizations and their affiliates become subject to the major assets
prohibition from $1.5 billion and $2.5 billion to $10 billion and $10
billion, respectively.
4. Projected Reporting, Recordkeeping, and Other Compliance
Requirements
To the extent that a small entity is subject to the major assets
prohibition by virtue of its affiliation with a banking organization
that has total assets exceeding $10 billion, the proposed rule would
not impose any additional requirements on those small entities because
they were already subject to the major assets prohibition. The proposed
changes to the major assets prohibition would not impose any new
reporting, recordkeeping, and other compliance requirements.
Accordingly, the Board believes that the proposed rule will not have a
significant economic impact on small banking organizations supervised
by the Board.
5. Identification of Duplicative, Overlapping, or Conflicting Federal
Regulations
The Board is aware of no other Federal rules that duplicate,
overlap, or conflict with the proposed changes to the major assets
prohibition thresholds.
6. Discussion of Significant Alternatives
The Board believes that the proposed rule will not have a
significant economic impact on small entities supervised by the Board
and therefore believes that there are no significant alternatives to
the proposed rule that would reduce the economic impact on small
entities supervised by the Board.
The Board welcomes comment on all aspects of its analysis. In
particular, the Board requests that commenters describe the nature of
any impact on small entities and provide empirical data to illustrate
and support the extent of the impact.
FDIC: The Regulatory Flexibility Act (RFA) generally requires that,
in connection with a proposed rule, an agency prepare and make
available for public comment an initial regulatory flexibility analysis
describing the impact of the rulemaking on small entities.\29\ A
regulatory flexibility analysis is not required, however, if the agency
certifies that the rule will not have a significant economic impact on
a substantial number of small entities. The Small Business
Administration (SBA) has defined ``small entities'' to include banking
organizations with total assets less than or equal to $550 million.\30\
The FDIC supervises 3,643 depository institutions,\31\ of which 2,840
are defined as small banking entities by the terms of the RFA.\32\
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\29\ 5 U.S.C. 601 et seq.
\30\ The SBA defines a small banking organization as having $550
million or less in assets, where ``a financial institution's assets
are determined by averaging the assets reported on its four
quarterly financial statements for the preceding year.'' 13 CFR
121.201 n.8 (2018). ``SBA counts the receipts, employees, or other
measure of size of the concern whose size is at issue and all of its
domestic and foreign affiliates . . . .'' 13 CFR 121.103(a)(6)
(2018). Following these regulations, the FDIC uses a covered
entity's affiliated and acquired assets, averaged over the preceding
four quarters, to determine whether the covered entity is ``small''
for the purposes of RFA.
\31\ FDIC-supervised institutions are set forth in 12 U.S.C.
1813(q)(2).
\32\ Call Report, December 31, 2017.
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The proposed rule will only affect institutions with total
consolidated assets between the current thresholds of $1.5 billion and
$2.5 billion and the proposed threshold of $10 billion. Therefore, the
proposed rule will likely affect zero small entities.
Accordingly, the FDIC believes that the proposed rule will not have
a significant impact on a substantial number of small entities. For the
reasons described above and pursuant to 5 U.S.C. 605(b), the FDIC
certifies that the proposed rule will not have a significant economic
impact on a substantial number of small entities.
The FDIC invites comments on all aspects of the supporting
information provided in this RFA section. In particular, would this
rule have any significant effects on small entities that the FDIC has
not identified?
[[Page 611]]
C. OCC Unfunded Mandates Reform Act of 1995 Determination
The OCC analyzed the proposed rule under the factors set forth in
the Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1532). Under
this analysis, the OCC considered whether the proposed rule includes a
Federal mandate that may result in the expenditure by State, local, and
Tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year (adjusted for inflation). The proposed
rule does not impose new mandates. Therefore, the OCC concludes that
the proposed rule will not result in an expenditure of $100 million or
more annually by state, local, and tribal governments or by the private
sector.
D. Riegle Community Development and Regulatory Improvement Act
The Riegle Community Development and Regulatory Improvement Act of
1994 requires that each Federal banking agency, in determining the
effective date and administrative compliance requirements for new
regulations that impose additional reporting, disclosure, or other
requirements on insured depository institutions (IDIs), consider,
consistent with principles of safety and soundness and the public
interest, any administrative burdens that such regulations would place
on depository institutions, including small depository institutions,
and customers of depository institutions, as well as the benefits of
such regulations. In addition, new regulations that impose additional
reporting, disclosures, or other new requirements on insured depository
institutions generally must take effect on the first day of a calendar
quarter that begins on or after the date on which the regulations are
published in final form.
The proposed rule would reduce burden and imposes no additional
reporting, disclosure, or other requirements on IDIs, including small
depository institutions, nor on the customers of depository
institutions. Nonetheless, in connection with determining an effective
date for the proposed rule, the agencies invite comment on any
administrative burdens that the proposed rule would place on depository
institutions, including small depository institutions, and customers of
depository institutions.
E. Plain Language
Section 722 of the Gramm-Leach-Bliley Act requires the Federal
banking agencies to use plain language in all proposed and final rules
published after January 1, 2000. The agencies have sought to present
the proposed rule in a simple and straightforward manner, and invite
comment on the use of plain language. For example:
Have the agencies organized the material to inform your
needs? If not, how could the agencies present the proposed rule more
clearly?
Are the requirements in the proposed rule clearly stated?
If not, how could the proposed rule be more clearly stated?
Does the proposed rule contain technical language or
jargon that is not clear? If so, which language requires clarification?
Would a different format (grouping and order of sections,
use of headings, paragraphing) make the proposed rule easier to
understand? If so, what changes would achieve that?
Is this section format adequate? If not, which of the
sections should be changed and how?
What other changes can the agencies incorporate to make
the proposed rule easier to understand?
List of Subjects
12 CFR Part 26
Antitrust, Banks, banking, Holding companies, Management official
interlocks, National banks.
12 CFR Part 212
Antitrust, Banks, banking, Holding companies, Management official
interlocks.
12 CFR Part 238
Administrative practice and procedure, Banks, banking, Holding
companies, Reporting and recordkeeping requirements, Securities.
12 CFR Part 348
Antitrust, Banks, banking, Holding companies.
Authority and Issuance
For the reasons stated in the preamble, the OCC proposes to amend
12 CFR part 26, the Board proposes to amend 12 CFR parts 212 and 238,
and the FDIC proposes to amend 12 CFR part 348 as follows:
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
PART 26--MANAGEMENT OFFICIAL INTERLOCKS
0
1. The authority citation for part 26 continues to read as follows:
Authority: 12 U.S.C. 1, 93a, 1462a, 1463, 1464, 3201-3208,
5412(b)(2)(B).
0
2. Section 26.3 is amended by revising the first sentence of paragraph
(c) to read as follows:
Sec. 26.3 Prohibitions.
* * * * *
(c) Major assets. A management official of a depository
organization with total assets exceeding $10 billion (or any affiliate
of such an organization) may not serve at the same time as a management
official of an unaffiliated depository organization with total assets
exceeding $10 billion (or any affiliate of such an organization),
regardless of the location of the two depository organizations. * * *
* * * * *
FEDERAL RESERVE SYSTEM
PART 212--MANAGEMENT OFFICIAL INTERLOCKS (REGULATION L)
0
3. The authority citation for part 212 continues to read as follows:
Authority: 12 U.S.C. 3201-3208; 15 U.S.C. 19.
0
4. Section 212.3 is amended by revising the first sentence of paragraph
(c) to read as follows:
Sec. 212.3 Prohibitions.
* * * * *
(c) Major assets. A management official of a depository
organization with total assets exceeding $10 billion (or any affiliate
of such an organization) may not serve at the same time as a management
official of an unaffiliated depository organization with total assets
exceeding $10 billion (or any affiliate of such an organization),
regardless of the location of the two depository organizations. * * *
PART 238--SAVINGS AND LOAN HOLDING COMPANIES (REGULATION LL)
0
5. The authority citation for part 238 is revised to read as follows:
Authority: 5 U.S.C. 552, 559; 12 U.S.C. 1462, 1462a, 1463,
1464, 1467, 1467a, 1468, 1813, 1817, 1829e, 1831i, 1972, 3201-3208;
15 U.S.C. 78 l.
0
6. Section 238.93 is amended by revising the first sentence of
paragraph (c) to read as follows:
Sec. 238.93 Prohibitions.
* * * * *
(c) Major assets. A management official of a depository
organization with total assets exceeding $10 billion (or any affiliate
of such an organization) may not serve at the same time as a management
official of an unaffiliated depository organization with total assets
exceeding $10 billion (or any affiliate of such an organization),
regardless of the
[[Page 612]]
location of the two depository organizations. * * *
FEDERAL DEPOSIT INSURANCE CORPORATION
PART 348--MANAGEMENT OFFICIAL INTERLOCKS
0
7. The authority citation for part 348 continues to read as follows:
Authority: 12 U.S.C. 3207, 12 U.S.C. 1823(k).
0
8. Section 348.3 is amended by revising the first sentence of paragraph
(c) to read as follows:
Sec. 348.3 Prohibitions.
(c) Major assets. A management official of a depository
organization with total assets exceeding $10 billion (or any affiliate
of such an organization) may not serve at the same time as a management
official of an unaffiliated depository organization with total assets
exceeding $10 billion (or any affiliate of such an organization),
regardless of the location of the two depository organizations. * * *
* * * * *
Dated: December 18, 2018.
William A. Rowe,
Chief Risk Officer.
By order of the Board of Governors of the Federal Reserve
System, December 14, 2018.
Ann E. Misback,
Secretary of the Board.
Dated at Washington, DC, this 18th day of December 2018.
By order of the Board of Directors.
Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 2018-28038 Filed 1-30-19; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 6714-01-P