FDIC finishes long-awaited rules on brokered funds, ILCs
Banks and some of their deposit-gathering businesses won additional regulatory relief Tuesday when the Federal Deposit Insurance Corp. finalized a new framework for classifying brokered deposits enabling a broader set of companies to escape restrictions.
The final overhaul roughly tracks with a December 2019 proposal aim at modernizing the definition of brokered deposits for the digital age. That definition has huge ramifications; banks with capital levels below the "well capitalized" mark are barred from accepting brokered funds.
At a public meeting, the agency's board of directors also finalized long-awaited standards for the corporate parents of industrial loan companies. Nonbanks such as fintech firms have sought greater clarity on the process for seeking ILC charters, while community banks have opposed many high-profile ILC charter bids.