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FIL-55-97 Attachment

[Federal Register: May 14, 1997 (Volume 62, Number 93)]

[Proposed Rules]

[Page 26431-26435]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr14my97-35]



 

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Proposed Rules

Federal Register

________________________________________________________________________


 

This section of the FEDERAL REGISTER contains notices to the public of

the proposed issuance of rules and regulations. The purpose of these

notices is to give interested persons an opportunity to participate in

the rule making prior to the adoption of the final rules.


 

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[[Page 26431]]


 

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FEDERAL DEPOSIT INSURANCE CORPORATION


 

12 CFR Part 307


 

RIN 3064-AB88



 

Notification of Changes of Insured Status


 

AGENCY: Federal Deposit Insurance Corporation (FDIC).


 

ACTION: Proposed rule.


 

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SUMMARY: The FDIC is proposing to revise its regulation addressing

notification of changes of insured status to clarify that an assuming

insured depository institution must provide the FDIC with a

certification of any partial or total assumption of deposits from

another insured depository institution. This certification would not be

required, however, when deposits are transferred and assumed by an

operating insured depository institution from an insured depository

institution in default in an FDIC-administered receivership. Forms are

being provided to assist the industry with compliance with the

certification and depositor notice requirements.


 

DATES: Written comments on the proposal must be received by the FDIC on

or before July 14, 1997.


 

ADDRESSES: Send written comments to the Office of the Executive

Secretary, Federal Deposit Insurance Corporation, 550 17th Street, NW.,

Washington, DC 20429. Comments may be hand-delivered to Room F-400,

1776 F Street, NW., 20429, on business days between 8:30 a.m. and 4:30

p.m.; sent by facsimile: (202) 898-3838; or by Internet:

Comments@fdic.gov. Comments may be inspected and photocopied in the

FDIC Public Information Center, Room 100, 801 17th Street, NW.,

Washington, DC 20429, between 9:00 a.m. and 4:30 p.m. on business days.


 

FOR FURTHER INFORMATION CONTACT: William P. McNamara, Examination

Specialist, Division of Supervision, (202) 898-6778; Rodney D. Ray,

Counsel, Legal Division, (202) 898-3556, Federal Deposit Insurance

Corporation, 550 17th Street, NW., Washington, DC 20429.


 

SUPPLEMENTARY INFORMATION: As required by section 303(a) of the Riegle

Community Development and Regulatory Improvement Act of 1994 (CDRIA)

(12 U.S.C. 4803), the FDIC has reviewed part 307 of the Code of Federal

Regulations and determined that the sections contained therein are

still beneficial to the public and needed by the FDIC. It is proposed

that the sections be revised to clarify their scope and applicability,

eliminate unnecessary compliance requirements, and assist the industry

with compliance.


 

Background


 

Part 307 was originally promulgated in 1950 and was last revised on

May 31, 1983, prior to the enactment of the Financial Institutions

Reform, Recovery, and Enforcement Act of 1989 (FIRREA). Public Law 101-

73, 103 Stat. 183 (1989).

Section 307.1 implements section 8(q) of the Federal Deposit

Insurance Act (FDI Act) (12 U.S.C. 1818(q)), as amended.1

The regulation requires an insured bank or insured branch of a foreign

bank which assumes deposits (assuming institution) of another insured

bank or insured branch of a foreign bank (transferring institution) to

provide the FDIC with a certification that it has assumed deposits of

the transferring institution. The assuming institution is required to

make the certification to the FDIC within 30 days after the date of the

assumption, and state the date the assumption took effect. The

certification is intended to satisfy section 8(q)'s ``satisfactory

evidence of such assumption'' requirement, which is a condition that

must be met before the transferring institution's insured status can be

terminated pursuant to section 8(q)(1) of the FDI Act (12 U.S.C.

1818(q)(1)). The certification also provides the FDIC with notice of

when the assumption takes effect for purposes of determining the

continuation of separate deposit insurance coverage on the assumed

deposits. See 12 CFR 330.3(g)(2).

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\1\ Section 8(q) reads as follows:

Whenever the liabilities of an insured depository institution

for deposits shall have been assumed by another insured depository

institution or depository institutions, whether by way of merger,

consolidation, or other statutory assumption, or pursuant to

contract (1) the insured status of the depository institution whose

liabilities are so assumed shall terminate on the date of receipt by

the Corporation of satisfactory evidence of such assumption; (2) the

separate insurance of all deposits so assumed shall terminate at the

end of six months from the date such assumption takes effect or, in

the case of any time deposit, the earliest maturity date after the

six-month period. Where the deposits of an insured depository

institution are assumed by a newly insured depository institution,

the depository institution whose deposits are assumed shall not be

required to pay any assessment with respect to the deposits which

have been so assumed after the semiannual period in which the

assumption takes place.

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Section 307.2, which implements section 8(a)(6) of the FDI Act (12

U.S.C. 1818(a)(6)),2 requires an insured bank or insured

branch of a foreign bank (insured institution) seeking to voluntarily

terminate its insured status, but whose deposits will not be assumed,

to provide notice to its depositors (depositor notice) of the date its

insured status will terminate. The regulation further authorizes the

FDIC, through the appropriate FDIC Regional Director of the Division of

Supervision, to prescribe the form, manner and timing of the depositor

notice, as well as such other conditions as may be deemed necessary for

the protection of the institution's depositors.

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\2\ Section 8(a)(6) reads as follows:

PUBLICATION OF NOTICE OF TERMINATION.--The Corporation may

publish notice of such termination and the depository institution

shall give notice of such termination to each of its depositors at

his last known address of record on the books of the depository

institution, in such manner and at such time as the Board of

Directors may find to be necessary and may order for the protection

of depositors.

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In response to a Notice of Opportunity for Comment, published on

December 6, 1995, at 60 FR 62345, as part of the CDRIA review process,

an industry group suggested that Sec. 307.1 be eliminated because the

industry group believed the FDIC could obtain the specified information

from regulatory approvals required for assumptions of deposit

liabilities by merger, consolidation, assumption or contract. The

industry group noted that the FDIC received antitrust notices and that

each governmental agency published administrative approvals in the

newspapers.

After investigating the commentor's suggestion, FDIC staff has

recommended that Sec. 307.1 be retained. While it is possible to obtain

some of the information required by the regulation from other agencies,

bank merger applications, and newspaper notices,


 

[[Page 26432]]


 

this method of data collection would not provide the FDIC or the

industry with sufficient certainty of receiving the data or a clear

standard for judging when the FDIC had received the ``satisfactory

evidence of such assumption'', required by section 8(q)(1), to

terminate the transferring institution's insured status. The FDIC's

preliminary view is that the inefficiency and additional costs

associated with collecting the statutorily required information through

these means outweighs any benefit which would be realized by

eliminating the FDIC certification requirement. Finally, from a

practical standpoint, timely and accurate submissions of the required

information are needed to maintain the accuracy of the FDIC's structure

database, which is utilized to calculate, collect, and process deposit

insurance assessments.

The FDIC is, however, proposing to revise Sec. 307.1 to define its

scope and applicability more precisely. Additionally, consistent with

the theme of the industry group's suggestion, the FDIC has determined

that it can obtain timely, accurate, and easily verifiable information

from records in the FDIC's possession regarding deposit liabilities

assumed when those liabilities are transferred and assumed by an

operating insured depository institution from an insured depository

institution in default, as defined by section 3(x)(1) of the FDI Act

(12 U.S.C. 1813(x)(1)), in an FDIC-administered receivership, and the

regulation would be revised accordingly.

No comments were received regarding Sec. 307.2. Nonetheless, that

section was reviewed and it is proposed that the section be retained

because it assists the FDIC in ensuring that the interests of

depositors are safeguarded when an insured depository institution seeks

to voluntarily terminate its insured status without the assumption of

its deposit liabilities by another insured depository institution. See

e.g. 12 U.S.C. 1818(a)(6) (requiring notification of depositors when

insured status is voluntarily or involuntarily terminated) 3

and 1828(i)(4)(E) (requiring the FDIC to consider the convenience and

needs of the community to be served in approving the conversion of an

insured depository institution into a non-insured institution).

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\3\ While part 307 addresses depositor notifications when an

institution seeks to voluntarily terminate its insured status, part

308 addresses depositor notifications for involuntary terminations

which are effected through enforcement proceedings.

---------------------------------------------------------------------------


 

Proposed Revisions


 

The existing sections in part 307 would be redesignated Secs. 307.2

and 307.3, respectively. A new Sec. 307.1 also would be added.

The proposed revisions to the regulations and reasons supporting

them are as follows:


 

A. Institutions Covered


 

Proposed Sec. 307.1 is new. It would be added to indicate that the

part applies to insured depository institutions, as defined in section

3(c)(2) of the FDI Act.4 Part 307, however, would not apply

to assumptions of insured deposits by uninsured depository

institutions; assumptions of uninsured deposits by insured depository

institutions; or assumptions of uninsured deposits by uninsured

depository institutions.

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\4\ An ``insured depository institution'' is defined in section

3(c)(2) (12 U.S.C. 1813(c)(2)) as ``any bank or savings association

the deposits of which are insured by the Corporation pursuant to

this [the FDI] Act''. Federal branches and insured branches are

included in the definition of ``bank'' in section 3(a)(1)(A) (12

U.S.C. 1813(A)(1)(a)). Accordingly, insured branches would be

subject to the proposed regulation.

---------------------------------------------------------------------------


 

As revised, any insured depository institution assuming deposits

from another insured depository institution, other than those excluded

from coverage by proposed Sec. 307.2(b), would be required to provide

the certification. Section 307.3 would apply to insured depository

institutions seeking to voluntarily terminate their insured status

without the assumption of their deposit liabilities by another insured

depository institution.


 

B. Transitions Covered


 

Proposed Sec. 307.2 would apply to partial and complete transfers

of deposits from transferring to assuming institutions.

As presently written, Sec. 307.1 does not distinguish between

transactions involving partial deposit assumptions where a transferring

institution intends to continue in the business of receiving deposits

after the partial assumption takes effect, and total deposit

assumptions, where the transferring institution intends to cease

receiving deposits after the assumption takes effect. In the past, the

FDIC has viewed Sec. 307.1 as being applicable in both instances.

The FDIC has taken the view that an order must be entered by the

FDIC before the transferring institution's insured status is

terminated.5 12 U.S.C. 1818(q), 12 U.S.C. 1828(i)(3), (4).

This reading avoids terminating the insured status of the transferring

institution when only a portion of that institution's deposits are

assumed and the transferring institution intends to continue in the

business of receiving deposits after the partial assumption takes

effect. This continues to be the FDIC's interpretation of the

termination of insured status provision contained in section 8(q)(1).

---------------------------------------------------------------------------


 

\5\ Orders are not issued by the Board of Directors in instances

where deposits are transferred and assumed upon the default of an

insured depository institution because the insured status of the

institution terminates automatically after default.

---------------------------------------------------------------------------


 

To avoid confusion on this issue, Sec. 307.2 (e) and (f) would be

added to the regulation. New Sec. 307.2(e) addresses the deposit

insurance coverage of the assumed deposits. It would be applicable to

partial and total assumptions of deposits from transferring

institutions and would utilize the assumption date specified in the

certification to determine when the separate deposit insurance coverage

on the assumed deposits terminates pursuant to section

8(q)(2).6 See also 12 CFR 330.3(g).

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\6\ Under the regulation, FDIC's receipt of the certification

constitutes satisfactory evidence of the assumption, for purposes of

section 8(q). In appropriate circumstances, however, such as an

assuming institution's failure to provide the certification in the

manner specified, the regulation specifies that the FDIC also may

consider other evidence of such deposit assumption for purposes of

section 8(q).

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Section 307.2(f) would address the insured status of the

transferring institution. It would be applicable to total deposit

assumptions where the transferring institution intends to cease

receiving deposits after the assumption takes effect. Under new

Sec. 307.2(f), when the FDIC receives the certification and a total

assumption has taken place (other than in instances where the FDIC has

been appointed receiver for an insured depository institution in

default), the FDIC will issue an order terminating the transferring

institution's insured status pursuant to applicable


 

[[Page 26433]]


 

provisions of the FDI Act, including section 8(q)(1).


 

C. FDIC Appointed Receiver for Insured Depository Institution in

Default


 

Current Sec. 307.1 does not distinguish between deposit assumptions

where the transferring institution has been placed in receivership and

deposit assumptions between operating institutions. Since the FDIC

plays an integral role in the transfer and assumption of deposit

liabilities by operating institutions when it is appointed as receiver

for an insured depository institution in default, this situation may

represent an instance where, consistent with the previously mentioned

industry group suggestion, the FDIC has access to readily verifiable

information regarding the deposit transfer and assumption transaction

which makes compliance with the regulation unnecessary. Therefore,

Sec. 307.2(b) would be added to confirm that compliance with the

certification requirement is not necessary when the deposit liabilities

being transferred and assumed by an operating insured depository

institution from an insured depository institution in default and the

FDIC has been appointed as receiver for the institution.


 

D. Required Certification and Depositor Notice Letters


 

Section 307.1 requires the assuming institution to certify that it

has assumed deposit liabilities from the transferring institution

within 30 days after the assumption takes effect. The regulation,

however, is silent regarding the form of the certification. In the

past, the FDIC has considered this requirement satisfied by a short

letter from the assuming institution containing the required

information. Therefore, to assist the industry with compliance and

eliminate ambiguity, Sec. 307.2(C) would be added to require that the

certification, which may follow the format provided in appendix A, be

provided by the assuming institution on its letterhead.

Section 307.2 also requires that the FDIC approve the form of any

proposed depositor notices when an insured depository institution

intends to voluntarily terminate its insured status without having its

deposits assumed by another institution. Although the FDIC may require

additional or substitute information to be contained in the depositor

notice if warranted under the circumstances, the suggested depositor

notice provided in appendix B is being provided to assist the industry

with compliance. A copy of this notice must be provided to and approved

by the appropriate Regional Director of the Division of Supervision

prior to the notice being distributed to the institution's depositors.


 

Paperwork Reduction Act


 

The collections of information contained in this proposed rule have

been submitted to the Office of Management and Budget (OMB) for review

and approval in accordance with the requirements of the Paperwork

Reduction Act of 1995 (PRA) (44 U.S.C. 3501 et seq.). Comments are

invited on: (a) Whether the collection of information is necessary for

the proper performance of the FDIC's functions, including whether the

information has practical utility; (b) the accuracy of the estimates of

the burden of the information collection, including the validity of the

methodology and assumptions used; (c) ways to enhance the quality,

utility, and clarity of the information to be collected; and (d) ways

to minimize the burden of the information collection on respondents,

including through the use of automated collection techniques or other

forms of information technology.

Comments should be addressed to the Office of Information and

Regulatory Affairs, OMB, Attention: Desk Officer Alexander Hunt, New

Executive Office Building, Room 3208, Washington, DC 20503, with copies

of such documents sent to Steven F. Hanft, Assistant Executive

Secretary (Regulatory Analysis), FDIC, Room F-400, 550 17th Street, NW,

Washington, DC 20429. All comments should refer to ``Part 307--

Certification and Depositor Notification.'' OMB is required to make a

decision concerning the collection of information contained in these

proposed regulations between 30 and 60 days after publication of this

document in the Federal Register. Therefore, a comment to OMB is best

assured of having its full effect if OMB receives it within 30 days of

publication. This does not affect the deadline for the public to

comment to the FDIC on the proposed regulation. Appendix A to this

Federal Register notice provides an example of a format that will

satisfy the collection of information requirement contained in

Sec. 307.2. Appendix B provides an example of a format that will

satisfy the collection of information requirement contained in

Sec. 307.3.

The revisions to the collection of information in this proposed

rule are found in Secs. 307.2 and 307.3. Section 307.2 would require

insured depository institutions assuming deposits from other insured

depository institutions to provide the required certification whenever

a partial or complete assumption of deposits occurs. The certification

would be required to determine the date upon which the separate deposit

insurance coverage on the assumed deposit liabilities terminates, as

provided in section 8(q)(2) of the FDI Act. The certification also

would be utilized when a complete assumption of deposit liabilities

occurs to terminate the insured status of the transferring institution,

pursuant to section 8(q)(1) of the FDI Act. Section 307.3 would require

an insured depository institution seeking to voluntarily terminate its

insured status without the assumption of its deposits by another

insured depository institution to provide the FDIC with a copy of the

depositor notification letter required by section 8(a)(6) of the FDI

Act for review prior to the letter being sent to the institution's

depositors.

The estimated average burden associated with all collections of

information in this proposed regulation is approximately 0.25 hours per

respondent. Additional information regarding the collections of

information and total estimated reporting burden in the proposed

regulation is summarized below:

Title: Part 307--Certification and Depositor Notification.

Frequency of Response: Occasional.

Affected Public: The certification required by Sec. 307.2 would

affect all insured depository institutions assuming deposit liabilities

from other insured depository institutions. The depositor notification

required by Sec. 307.3 would affect all insured depository institutions

seeking to voluntarily terminate their insured status without having

their deposit liabilities assumed by another insured depository

institution.

Estimated Number of Respondents: 942 for Sec. 307.2 certification

and 1 for Sec. 307.3 notice.

Estimated Time per Response: 0.25 for section 307.2 certification

and 1 hour for Sec. 307.3 notice.

Estimated Total Annual Burden: 236.50 hours.


 

Regulatory Flexibility Act


 

Pursuant to subsections (b) and (c) of section 603 of the

Regulatory Flexibility Act, the FDIC provides the following initial

regulatory flexibility analysis:

Reasons Why Agency Action is Being Considered: Insured depository

institutions would be required to provide the FDIC with a

certification, pursuant to Sec. 307.2, when they partially or

completely assume deposit liabilities from another insured depository

institution. The certification is necessary to implement the provisions

of section 8(q) of the FDI Act, regarding


 

[[Page 26434]]


 

termination of the insured status of the transferring institution and

termination of the separate deposit insurance coverage provided on

deposit accounts assumed by the assuming institution.

Insured depository institutions seeking to voluntarily terminate

their insured status also would be required to provide the FDIC with a

copy of any proposed depositor notification before the notification is

provided to the institution's depositors. The depositor notification is

required by section 8(a)(6) of the FDI Act. The requirement for pre-

review of the proposed depositor notification letter by the FDIC

establishes a procedure to assure that the institution's depositors

receive information which the appropriate Regional Director of the

Division of Supervision deems appropriate regarding the institution's

intent to terminate its insured status. The requirement for pre-review

of the proposed depositor notification letter by the FDIC also is

intended to ensure that, prior to the termination of the institution's

insured status, depositors receive appropriate information concerning

federal deposit insurance coverage of their accounts once the

institution's insured status is terminated.

Statement of Objectives of and Legal Basis for Proposed Rule: The

proposed rule implements the statutory requirements imposed by section

8(q) of the FDI Act for assumptions of deposits from insured depository

institutions. The proposed rule also implements the statutory depositor

notification requirement imposed by section 8(a)(6) of the FDI Act when

an insured depository institution seeks to voluntarily terminate its

insured status without the assumption of its deposit liabilities by

another insured depository institution.

Description of and Estimate of the Number of Small Entities to

Which Proposed Rule Would Apply: The proposed rule would apply to all

insured depository institutions assuming deposit liabilities from

another insured depository institution. It also would apply to insured

depository institutions seeking to voluntarily terminate their insured

status without having their deposit liabilities assumed by another

insured depository institution. Based upon information supplied to the

FDIC by insured depository institutions or other federal banking

regulators, approximately 105 insured depository institutions which

were classified as small entities, for purposes of the RFA,

7 engaged in transactions during the 1996 calendar year

which would be covered by the proposed regulation. The FDIC has no

reason to believe that the number of small entities covered by the

proposed regulation will vary significantly in the future.

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\7\ The RFA defines the term ``small entity'', in 5 U.S.C. 601,

by reference to definitions published by the Small Business

Administration. The Small Business Administration has defined a

``small entity'', for banking purposes, as a national or commercial

bank, savings institution or credit union with less than $100

million in assets. See 13 CFR 121.201.

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Projected Reporting, Recordkeeping, and Other Compliance

Requirements of the Proposed Rule: Small entities engaging in

transactions governed by the proposed regulation should be maintaining

information regarding depositor accounts and deposit assumptions as

part of their normal banking operations. The number of deposit

assumption certifications required by Sec. 307.2 will depend upon the

number of deposit assumption transactions engaged in by an assuming

insured depository institution. The FDIC anticipates that the depositor

notification process established by Sec. 307.3 will only occur once

because depositor notification is required prior to the voluntary

termination of an insured depository institution's insured status with

the FDIC. The FDIC estimates that small entities will be able to comply

with the requirements imposed by the regulation by utilizing their

existing senior management and clerical support.

Identification of Federal Rules Which may Duplicate, Overlap or

Conflict With the Proposed Rule: Some information concerning deposit

liabilities assumed or proposed to be assumed by merger, consolidation,

other statutory assumption, or contract is required to be filed with

the FDIC, pursuant to part 327 and Sec. 303.3 of the FDIC's rules and

regulations (12 CFR part 327 and 12 CFR 303.3, respectively).

Information filed with the FDIC pursuant to Sec. 303.3, however, is in

the form of an application which is subject to modification and

information filed pursuant to part 327, does not specify the

institution whose deposits were assumed or when the assumption took

effect. Therefore, while there is some overlapping of general

information being submitted, the information contained in the

certification required by proposed Sec. 307.2 provides the FDIC with

more specific and timely data needed to comply with the requirements of

section 8(q) of the FDI Act. Additionally, the regulation provides the

FDIC and industry with a clear standard for judging when an insured

depository institution's insured status should be terminated.

Discussion of Significant Alternatives to Proposed Rule: The

proposed regulation imposes minimal reporting burdens upon insured

depository institution. As discussed in the preamble to the regulation,

the FDIC considered obtaining the information from other sources but

determined that those methods of data collection would not provide the

FDIC with sufficient certainty of receiving the data required by

section 8(q). Additionally, absent the regulation, the FDIC and

industry would have no clear standard for judging when an insured

depository institution's insured status should be terminated. To reduce

regulatory burden, however, the FDIC is excluding deposit assumptions

from FDIC-administered receiverships from the coverage of Sec. 307.2.

The FDIC also is providing recommended certification and depositor

notification forms as guidelines for the industry.


 

List of Subjects in 12 CFR Part 307


 

Bank deposit insurance, Reporting and recordkeeping requirements.


 

For the reasons set forth in the preamble, the Board of Directors

proposes to revise part 307 of chapter III of the Code of Federal

Regulations to read as follows:


 

PART 307--NOTIFICATION OF CHANGES OF INSURED STATUS


 

Sec.

307.1 Scope and purpose.

307.2 Certification of assumption of deposit liabilities.

307.3 Notice to depositors when insured status is voluntarily

terminated and deposits are not assumed.


 

Appendix A to Part 307--Certification of Change in Insured

Status.

Appendix B to Part 307--Notice to Depositor of Voluntary

Termination of Insured Status.


 

Authority: 12 U.S.C. 1818(a)(6), 1818(q), and 1819(a) [Tenth].


 

Sec. 307.1 Scope and purpose.


 

(a) Scope. This part applies to all insured depository

institutions, as defined in section 3(c)(2) of the Federal Deposit

Insurance Act (FDI Act) (12 U.S.C. 1813(c)(2)).

(b) Purpose. This part sets forth the rules governing:

(1) The time and manner of providing the FDIC with a certification

regarding the assumption of any deposit liabilities of an insured

depository institution by any insured depository institution; and

(2) The notification which should be provided to depositors when an

insured


 

[[Page 26435]]


 

depository institution voluntarily terminates its insured status and

its deposits are not assumed by another insured depository institution.


 

Sec. 307.2 Certification of assumption of deposit liabilities.


 

(a) Certification required. Whenever any of the deposit liabilities

of an insured depository institution are assumed (whether by merger,

consolidation, other statutory assumption, or by contract) by another

insured depository institution, the assuming insured depository

institution shall provide a written certification to the FDIC that it

has assumed deposit liabilities from the transferring insured

depository institution. The certification shall be provided to the FDIC

within 30 calendar days after the assumption takes effect and shall

state the date the assumption took effect.

(b) Exception. The certification required by paragraph (a) of this

section shall not be required when deposit liabilities are transferred

and assumed by an operating insured depository institution from an

insured depository institution in default, as defined in section

3(x)(1) of the FDI Act (12 U.S.C. 1813(x)(1)), that has been placed in

an FDIC-administered receivership.

(c) Form of certification. The certification required by paragraph

(a) of this section shall be provided on the letterhead of the assuming

insured depository institution, be signed by a duly authorized official

of the institution, and may follow the format of the certification

contained in appendix A to this part.

(d) Filing. The certification required by paragraph (a) of this

section shall be provided to the appropriate FDIC Regional Director of

the Division of Supervision, as determined by reference to 12 CFR part

303, for the assuming insured depository institution.

(e) Evidence of assumption. The receipt by the FDIC of the

certification required by paragraph (a) of this section shall

constitute satisfactory evidence of such deposit assumption, as

required by section 8(q) of the FDI Act (12 U.S.C. 1818(q)), and the

separate deposit insurance on the deposits so assumed shall terminate

in the manner specified in section 8(q)(2) of the FDI Act (12 U.S.C.

1818(q)(2)). In appropriate circumstances, the FDIC, in its sole

discretion, may also consider other evidence of such deposit assumption

to be satisfactory for purposes of section 8(q).

(f) Issuance of an order. Except where the FDIC has been appointed

as receiver for an insured depository institution in default, the FDIC

shall issue an order terminating the insured status of the transferring

insured depository institution, pursuant to section 8(q)(1) of the FDI

Act (12 U.S.C. 1818(q)(1)), in the event that all of the transferring

institution's deposits are assumed by one or more insured depository

institutions.


 

Sec. 307.3 Notice to depositors when insured status is voluntarily

terminated and deposits are not assumed.


 

(a) Notice required. Any insured depository institution seeking to

voluntarily terminate its insured status, but whose deposit liabilities

will not be assumed by another insured depository institution, shall

provide prior written notification to each of its depositors, at the

depositor's last address of record on the books of the institution, of

the date of the termination of its insured status under the FDI Act.

(b) Prior approval of notice. Prior to distributing the notice to

depositors required by paragraph (a) of this section, a copy of the

proposed notice shall be provided to the appropriate FDIC regional

director of the Division of Supervision, as determined by reference to

12 CFR part 303, for approval. After being approved for distribution,

the notice shall be provided to depositors in the time and manner

specified by the appropriate regional director.

(c) Form of notice. The notice to depositors required by paragraph

(a) of this section shall be provided on the letterhead of the insured

depository institution and, unless otherwise specified by the

appropriate Regional Director of the Division of Supervision, may

follow the format of the notice contained in appendix B to this part.

(d) Obligations. The FDIC may require the insured depository

institution to take such other actions as the FDIC considers

appropriate for the protection of depositors.


 

Appendix A to Part 307--Certification of Change in Insured Status


 

(Date)


 

(Name and Address of Regional Director)


 

SUBJECT: Certification of Change In Insured Status


 

This certification is being provided pursuant to 12 U.S.C.

1818(q) and 12 CFR 307.2(a). On (state the date the deposit

assumption took effect), (state the name of the depository

institution assuming the deposit liabilities) assumed (if a partial

assumption, state the amount) (if all deposits were assumed, state

``all'') of the deposits of (state the name of the insured

depository institution whose deposits were assumed). Please contact

the undersigned if additional information is needed.


 

(Name of Assuming Institution)


 

By:--------------------------------------------------------------------

(Name and Title)


 

Appendix B to Part 307--Notice to Depositor of Voluntary Termination of

Insured Status


 

(Date)


 

(Name and Address of Depositor)


 

SUBJECT: Notice to Depositor of Voluntary Termination of Insured

Status

The insured status of (name of insured depository institution)

under the provisions of the Federal Deposit Insurance Act, will

terminate as of the close of business on the ________ Day of

____________________, 19____ (``termination date''). Insured

deposits in the (name of insured depository institution) on the

termination date, less all subsequent withdrawals from such

deposits, will continue to be insured by the Federal Deposit

Insurance Corporation, to the extent provided by law, until (date).

Any deposits made by you after the termination date, either new

deposits or additions to existing deposits, will not be insured by

the Federal Deposit Insurance Corporation.

This notice is being provided pursuant to 12 U.S.C. 1818(a)(6) and

12 CFR 307.3(a).

Please contact (name of institution official in charge of

depositor inquiries), at name and address of insured depository

institution if additional information is needed regarding this

Notice or the insured status of your account.


 

By order of the Board of Directors. Dated at Washington, D.C.,

this 29th day of April, 1997.


 

Federal Deposit Insurance Corporation

Robert E. Feldman,

Deputy Executive Secretary.

[FR Doc. 97-12549 Filed 5-13-97; 8:45 am]

BILLING CODE 6714-01-P

Last Updated: March 24, 2024