Comments due June 18 on FDIC bank merger policy statement

Public comments on the federal bank deposit insuring agency’s proposed statement of policy on bank merger transactions are due June 18, according to a notice in Friday’s Federal Register.

The proposed statement, issued March 21 by the Federal Deposit Insurance Corp. (FDIC) Board, would provide a “principles-based” overview of the agency’s administration of its responsibilities under the Bank Merger Act (BMA). The agency said the proposal focuses on the scope of merger transactions subject to its approval; the FDIC’s process for evaluating merger applications; and the principles that guide the agency’s consideration of the applicable statutory factors under the BMA.

In a statement, FDIC Board Chairman Martin Gruenberg indicated that the recent pace of bank mergers made it imperative that the board issue the statement. “It is vital that the FDIC provide guidance on how it would apply the critical statutory factors under the Bank Merger Act relating to competition, financial resources, the convenience and needs of communities, financial stability, and money laundering,” he said.

The FDIC, in its proposal notice, pointed to request for information (RFI) it issued in 2022 regarding the application of the laws, practices, rules, regulations, guidance, and SOP that apply to merger transactions subject to FDIC approval. The agency said it received 33 comment letters in response to that RFI, with majority of RFI commenters (25 commenters, or 76% of all commenters) being in favor of at least some changes to the FDIC’s merger review processes. It said six RFI commenters (18%) were against changes to the FDIC’s merger review processes, and two RFI commenters (6%) were neither in favor of, nor against, changes to the FDIC’s merger review processes.

Last month’s proposal was issued on a party-line vote of 3-2 by the FDIC Board, with the panel’s three Democrats – Gruenberg, Acting Comptroller of the Currency Michael Hsu and Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra (the latter two serving on the board by virtue of their top posts at the OCC and CFPB) – all voting in favor. The two Repubicans on the board – Vice Chairman Travis Hill and Jonathon McKernan – voted against.

Federal Register notice

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