The Federal Deposit Insurance Corporation (FDIC) Board of Directors today approved a Notice of Proposed Rulemaking to amend the agency’s regulations under the Change in Bank Control Act. The proposed rule would require the provision of advance notice to the FDIC for certain acquisitions of voting securities of FDIC-supervised institutions, at a level sufficient to trigger a presumption of control under the regulations, whether such investments are made directly in the institution or indirectly through a holding company.
As the primary federal regulator for state nonmember banks and state savings associations, the FDIC has an interest when entities seek to directly or indirectly control FDIC- supervised institutions. The proposed rule would enable the FDIC to consider the full range of options available to it under the Change in Bank Control Act. However, the FDIC also recognizes the importance of interagency collaboration and consistency with respect to the review of transactions under the Act and is committed to continuing to engage with the Federal Reserve Board and the Office of the Comptroller of the Currency to develop an interagency approach to the issues discussed in this proposal.
Generally, under the Change in Bank Control Act, no person may acquire control of an insured depository institution without providing at least 60 days prior written notice to the appropriate federal banking agency. The FDIC’s current regulations exempt transactions from this notice requirement in cases where the Federal Reserve Board reviews a Change in Bank Control notice and, in practice, the FDIC has also forgone the notice requirement when the Federal Reserve has accepted “passivity commitments” from an investor. The proposed rule would remove the exemption, override the practice, and request further public comment regarding the FDIC’s overall approach to changes in control affecting FDIC-supervised institutions.
Public comments on the proposal are due [60 days after publication in the Federal Register].