February 2, 2016

Small Bank Pricing

Small Bank Pricing

The Federal Deposit Insurance Corporation’s (“FDIC”) Board of Directors has issued a Notice of Proposed Rulemaking (“NPR”) to revise the NPR previously issued in June 2015 in order to address the deposit insurance assessment system applicable to institutions with less than $10 billion in assets.  The revised NPR will be similar to the 2015 NPR with some differences including a revised one-year asset growth measure, the use of a brokered deposit ratio rather than the previously proposed core deposit ratio, removal of the brokered deposit adjustment and revision of the weights assigned to the proposed measures in the financial ratios method.  These refinements would become effective during the latter of  the quarter subsequent to the reserve ratio of the Deposit Insurance Fund (“DIF”) reaching 1.15% or the quarter subsequent to the final rule being adopted.  In the end this should give some minor regulatory relief to the small bank institutions within the industry.     

For more information see the attached FIL “Small Bank Pricing Notice of Proposed Rule Making” from the FDIC for more detailed information https://www.fdic.gov or contact James Dowling, Audit Manager and member of Marcum’s Financial Institutions Services Group, at James.Dowling@Marcumllp.com