On November 13, 2015, the Federal Deposit Insurance Corporation (FDIC) published FIL-51-2015 to update an introductory letter and a frequently asked questions document (FAQs) on brokered deposits, which had been issued through FIL-2-2015 on January 5, 2015. In the press release accompanying the update, the FDIC noted that “[t]he agency said in January it would provide updates to the FAQs as necessary” and that it “is updating the document in response to further inquiries and comments.” The introductory letter was revised to note that the FAQs will be updated “annually, as needed.” The FDIC has invited public comment on the revisions by December 28, 2015.
Background -
The FDIC is charged with making the determination of when deposits at any insured depository institution, regardless of its primary regulator, are considered to be “brokered deposits.” This distinction is important for all institutions because it can affect deposit insurance assessments. Further, only well-capitalized banks, as defined by the prompt corrective action (PCA) regulations issued by the bank’s federal bank regulator, may solicit and accept brokered deposits without restriction. For all banks, brokered deposits have to be reported on call reports, and over-reliance on brokered deposits can be perceived as a safety and soundness concern by the regulators, regardless of whether the bank is well-capitalized.
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