Bank Brokered Deposits: New FDIC Guidance on Identifying, Accepting and Reporting Deposits

Meeting FDIC Expectations and Reporting Requirements in an Era of Heightened Scrutiny

Recording of a 90-minute CLE webinar with Q&A


Conducted on Tuesday, May 19, 2015

Recorded event now available

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Program Materials

This CLE webinar will provide counsel with a review of the regulatory scheme for bank acceptance of brokered deposits in light of recent and existing FDIC guidance. In Jan. 2015, the FDIC released a Financial Institution Letter (FIL) providing guidance for depository institutions regarding its brokered deposit regulations. The FDIC prohibits the acceptance of brokered deposits by “undercapitalized" banks and requires “adequately capitalized” banks to obtain a waiver to accept brokered deposits.

Description

This new FIL further explains previous agency opinions and letters on the acceptance of brokered deposits. Key issues addressed in the FIL are the scope of the “deposit broker” definition, including what qualifies as placing and facilitating deposits, and exceptions to the definition of “deposit broker”. The FIL provides guidance on deposits related to prepaid cards, bank networks and listing services and when they may be considered brokered deposits.

Listen as our authoritative panel of banking practitioners reviews the regulatory scheme for acceptance of brokered deposits in light of the FDIC’s recent guidance. The panel will also discuss the responsibility of banks to determine whether deposits are “brokered deposits” and the consequences of accepting brokered deposits.

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Outline

  1. Overview of the brokered deposit market
  2. Brief history of the brokered deposit restrictions
  3. Sources of FDIC guidance on brokered deposits
  4. Analysis of FDIC’s recent FIL on brokered deposits
    1. Regulatory restrictions on brokered deposits
    2. Scope of “deposit broker” definition
    3. Exceptions from the definition, including “primary purpose” and listing services
    4. Application of the guidance to pre-paid card deposits
  5. Consequences of accepting brokered deposits

Benefits

The panel will review these and other key issues:

  • What activities will the FDIC view as “facilitating” a brokered deposit?
  • What clarification does the FDIC provide on the “primary purpose” exception to the definition of deposit broker?
  • What steps should depository institutions take to ensure they comply with FDIC guidance?
  • What can the banking industry do to change the perception of brokered deposits?

Faculty

Paul T. Clark
Paul T. Clark

Partner
Seward & Kissel

Mr. Clark provides regulatory and transactional advice to a wide range of clients, including banks, broker-dealers,...  |  Read More

David F. Freeman, Jr.
David F. Freeman, Jr.

Partner
Arnold & Porter

Mr. Freeman is head of the firm's Financial Services Practice Group. He represents financial institutions,...  |  Read More

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