A joint agency proposal to hike the major assets prohibition thresholds below which banks and thrifts would be exempt from a prohibition on management official interlocks is detailed in a bulletin issued Monday by the Office of the Comptroller of the Currency (OCC).
The proposed rule, issued by the OCC, Federal Reserve Board, and Federal Deposit Insurance Corp. (FDIC) and published in the Jan. 31 Federal Register, would provide the first increase since 1996 in the major asset thresholds set under the Depository Institutions Management Interlocks Act (DIMIA). Currently, a management official of a depository organization with total assets exceeding $2.5 billion (or any affiliate of such an organization) is prohibited from simultaneously serving also as a management official of an unaffiliated depository organization with total assets exceeding $1.5 billion (or any of its affiliates). The agencies propose to raise both thresholds to $10 billion.
The proposed rule, out for comment until April 1, also proposes three alternative approaches for raising the thresholds. These are based on the percentage of the number of banking organizations covered by the prohibition; based on asset growth; and based on inflation.
The DIMIA provides that the agencies may adjust, by regulation, the major assets prohibition thresholds to allow for inflation or market changes.