Management Interlocks

FIL-88-2018
December 20, 2018

Management Interlocks

Interagency Proposed Rule on Thresholds Increase for Major Assets Prohibition of the Depository Institution Management Interlocks Act Rules

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FIL-88-2018 – PDF (PDF Help)

Summary:

The FDIC and the other federal financial institution regulatory agencies have jointly issued a proposed rulemaking to raise the thresholds for the Major Assets Prohibition of the Depository Institution Management Interlocks Act (DIMIA) implementing rules.

Statement of Applicability to Institutions with Total Assets Under $1 Billion: This Financial Institution Letter applies to FDIC-supervised financial institutions with total assets over $1 billion.

Highlights:

• The FDIC, the Office of the Comptroller of the Currency, and the Board of Governors of the Federal Reserve System are issuing a Notice of Proposed Rulemaking (NPR) with a request for comment on a proposal to adjust the major assets prohibition thresholds of the DIMIA rule to fulfill a commitment made in the 2017 Economic Growth and Regulatory Paperwork Reduction Act Report to Congress.
• Under the existing major assets prohibition, a management official of a depository organization with total assets exceeding $2.5 billion (or any affiliate of such an organization) may not serve at the same time as a management official of an unaffiliated depository organization with total assets exceeding $1.5 billion (or any affiliate of such an organization), regardless of the location of the two depository organizations.
• The NPR proposes to increase both thresholds in the major assets prohibition rule to a single $10 billion threshold based on general market changes since 1996 when the major assets threshold in DIMIA was amended.
• The NPR also solicits comments on three alternative approaches to raise the major assets prohibition thresholds. Two are based on market changes, and one is based on inflation adjustments.
• Comments on the proposed rule and alternative approaches to raise the thresholds are due 60 days after publication in the Federal Register.