Notice of Final Rulemaking on Establishment and Relocation of Branches and Offices

Summary:

The Federal Deposit Insurance Corporation (FDIC) is issuing a final rule amending the FDIC Rules and Regulations governing the processes for an insured State nonmember bank to establish a domestic branch or relocate a main office or domestic branch. The final rule also makes corresponding changes to the processes applicable to the relocation of an insured branch of a foreign bank. 

The final rule streamlines filing content requirements, reduces expedited processing timelines, expands expedited processing, eliminates the FDIC’s discretion to remove filings from expedited processing, eliminates filing requirements for de minimis branch facility changes, eliminates public notice and comment requirements, and extends the expiration period for an approved filing. The final rule is intended to improve the speed and certainty of, and reduce the regulatory burden associated with, branch and main office filings.

Statement of Applicability: The contents of, and material referenced in, this FIL apply to insured State nonmember banks and insured branches of foreign banks. 

Highlights:

Key elements of the final rule include:

• Streamlined filing content requirements. The information required to be included with a branch filing is limited to the following under the final rule:
  • A statement of intent; the proposed branch or main office’s exact location; when a filing is submitted to relocate a branch or main office from one State to another, a statement of intent to retain branches in the prior State; and with respect to a branch or main office relocation, confirmation that advance written customer notice was provided.
• Shortened expedited processing timelines. The final rule significantly shortens the timeframe within which a branch filing is processed under expedited processing. For example, an intrastate branch relocation filing that includes the required content would be automatically deemed approved on the 3^rd business day instead of the 21^st business day.
  • Filings not subject to expedited processing remain subject to standard processing.
• Expanded expedited processing. Under the final rule, intrastate branch and main office relocation filings will receive expedited processing if the institution received an FDIC-assigned composite rating of 3 or better under the Uniform Financial Institutions Rating System as a result of its most recent Federal or State examination, regardless of whether the institution satisfies the other criteria in 12 CFR 303.2(r) for an eligible depository institution.
• Automatic approval. The FDIC no longer maintains discretion to remove a branch filing from expedited processing.
• De minimis branch facility changes. Under the final rule, a de minimis change in address is not subject to a filing requirement. Institutions are required to notify customers of a de minimis change in address.
• Public notice requirements. The final rule eliminates newspaper publication requirements from Part 303, Subpart C, of the FDIC Rules and Regulations.
• Additional changes. The final rule extends the expiration period for an approved filing from 18 to 24 months, adopts a definition of the term “remote service unit” which remains excluded from the definition of “branch,” replaces the term “de novo branch” with “de novo interstate branch,” and adopts a definition of “intrastate main office relocation” in Subpart C.