Special Assessment Collection

<RULE> FEDERAL DEPOSIT INSURANCE CORPORATION <CFR>12 CFR Part 327</CFR> <RIN>RIN 3064-AG24</RIN> <SUBJECT>Special Assessment Collection</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Federal Deposit Insurance Corporation. <HD SOURCE="HED">ACTION:</HD> Interim final rule; request for comments. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Federal Deposit Insurance Corporation (FDIC) has been collecting a special assessment to recover losses arising from the protection of uninsured depositors under the systemic risk exception, as required by statute. To ensure that the FDIC recovers the correct amount of losses while minimizing the risk of overcollecting or undercollecting in aggregate, the FDIC is adopting this interim final rule to reduce the rate at which the special assessment will be collected in the eighth collection quarter from 3.36 basis points to 2.97 basis points, and provide an offset to regular quarterly deposit insurance assessments for banks subject to the special assessment if the amount collected exceeds losses following the resolution of litigation between the FDIC and SVB Financial Trust (SVBFT) and again following the termination of the receiverships. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> The interim final rule is effective December 19, 2025. Comments must be received on or before January 20, 2026. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> You may submit comments, identified by RIN 3064-AG24, by any of the following methods: • <E T="03">FDIC Website: https://www.fdic.gov/federal-register-publications.</E> Follow instructions for submitting comments on the agency website. • <E T="03">Email: Comments@fdic.gov.</E> Include 3064-AG24 in the subject line of the message. • <E T="03">Mail:</E> Jennifer M. Jones, Deputy Executive Secretary, Attention: Comments-RIN 3064-AG24, Federal Deposit Insurance Corporation, 550 17th Street NW, Washington, DC 20429. • <E T="03">Hand Delivery to FDIC:</E> Comments may be hand-delivered to the guard station at the rear of the 550 17th Street NW building (located on F Street NW) on business days between 7 a.m. and 5 p.m. • <E T="03">Public Inspection:</E> Comments received, including any personal information provided, may be posted without change to <E T="03">https://www.fdic.gov/federal-register-publications.</E> Commenters should submit only information that the commenter wishes to make available publicly. The FDIC may review, redact, or refrain from posting all or any portion of any comment that it may deem to be inappropriate for publication, such as irrelevant or obscene material. The FDIC may post only a single representative example of identical or substantially identical comments, and in such cases will generally identify the number of identical or substantially identical comments represented by the posted example. All comments that have been redacted, as well as those that have not been posted, that contain comments on the merits of the proposed rule will be retained in the public comment file and will be considered as required under all applicable laws. All comments may be accessible under the Freedom of Information Act. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Division of Insurance and Research: Kayla Shoemaker, Chief, Banking and Regulatory Policy Section, 202-898-6962, <E T="03">kashoemaker@fdic.gov;</E> Daniel Hoople, Acting Associate Director, Financial Risk Management Branch, 202-898-3835, <E T="03">dhoople@fdic.gov;</E> Legal Division: Ryan McCarthy, Counsel, 202-898-7301, <E T="03">rymccarthy@fdic.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Background</HD> Section 13(c)(4)(G) of the Federal Deposit Insurance Act (FDI Act) permits the FDIC to take certain actions with respect to an insured depository institution (IDI) for which the FDIC has been appointed receiver, following a recommendation by the FDIC Board of Directors (Board), with the written concurrence of the Board of Governors of the Federal Reserve System (Board of Governors), and a determination of systemic risk by the Secretary of the U.S. Department of Treasury (Treasury) (in consultation with the President). <SU>1</SU> <FTREF/> On March 12, 2023, the Secretary of the Treasury, acting on the recommendation of the Board and Board of Governors, and after consultation with the President, invoked the statutory systemic risk exception with respect to the resolutions of Silicon Valley Bank and Signature Bank. <SU>2</SU> <FTREF/> <FTNT> <SU>1</SU>  12 U.S.C. 1823(c)(4)(G). As used in this interim final rule, the term “bank” is synonymous with the term “insured depository institution” as it is used in section 3(c)(2) of the FDI Act, 12 U.S.C. 1813(c)(2). </FTNT> <FTNT> <SU>2</SU>  12 U.S.C. 1823(c)(4)(G). See also: FDIC PR-17-2023. “Joint Statement by the Department of the Treasury, Federal Reserve, and FDIC.” March 12, 2023. <E T="03">https://www.fdic.gov/news/press-releases/2023/pr23017.html.</E> </FTNT> Under section 13(c)(4)(G) of the FDI Act, the loss to the Deposit Insurance Fund (DIF) arising from the use of a systemic risk exception must be recovered from one or more special assessments on IDIs, depository institution holding companies (with the concurrence of the Secretary of the Treasury with respect to holding companies), or both, as the FDIC determines to be appropriate. <SU>3</SU> <FTREF/> <FTNT> <SU>3</SU>  12 U.S.C. 1823(c)(4)(G)(ii)(I). </FTNT> The estimated losses to the DIF attributable to Silicon Valley Bank and Signature Bank are periodically adjusted as the FDIC, as receiver of the failed banks, sells assets, satisfies liabilities, and incurs receivership expenses. The exact amount of actual losses incurred, and therefore the amount the FDIC must recover through the special assessment, will not be determined until the FDIC terminates the receiverships. <HD SOURCE="HD1">II. The Final Rule Implementing the Special Assessment</HD> On November 29, 2023, the FDIC published in the <E T="04">Federal Register</E> a final rule (the special assessment rule) to implement a special assessment, as required by the FDI Act, to recover the loss to the DIF arising from the protection of uninsured depositors following the closures of Silicon Valley Bank and Signature Bank. <SU>4</SU> <FTREF/> <FTNT> <SU>4</SU>   <E T="03">See</E> 88 FR 83329 (Nov. 29, 2023). <E T="03">See also</E> 12 CFR 327.13. </FTNT> As stated in that rulemaking, the special assessment rule allocated the collection over eight quarterly assessment periods to reduce the likelihood of overcollecting and to mitigate the liquidity effects of the special assessment on IDIs by requiring smaller, consistent quarterly payments. The FDIC began collecting the special assessment with the invoice for the first quarterly assessment period of 2024 ( <E T="03">i.e.,</E> January 1, 2024, through March 31, 2024), with a payment date of June 28, 2024. Throughout the initial eight-quarter collection period, the special assessment has been collected at a quarterly rate of 3.36 basis points, multiplied by an IDI's special assessment base of estimated uninsured deposits as reported in the Consolidated Reports of Condition and Income (Call Report) or Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks (FFIEC 002), reported for the quarter that ended December 31, 2022, adjusted to exclude the first $5 billion in estimated uninsured deposits from the IDI, or for IDIs that are part of a holding company with one or more subsidiary IDIs, at the banking organization level. <SU>5</SU> <FTREF/> <FTNT> <SU>5</SU>  Under the special assessment rule, the term “banking organization” includes IDIs that are not subsidiaries of a holding company as well as holding companies with one or more subsidiary IDIs. Estimated uninsured deposits are reported in Memoranda Item 2 on Schedule RC-O, Other Data for Deposit Insurance Assessments of both the Call Report and FFIEC 002. Insured depository institutions IDIs with less than $1 billion in total assets as of June 30, 2021, were not required to report the estimated amount of uninsured deposits on the Call Report for December 31, 2022. Therefore, for IDIs that had less than $1 billion in total assets as of June 30, 2021, the amount and share of estimated uninsured deposits as of December 31, 2022, would be zero. For an IDI that is part of a holding company with more than one subsidiary IDI, the $5 billion deduction is apportioned based on its estimated uninsured deposits as a percentage of total estimated uninsured deposits held by all IDI affiliates in the banking organization. </FTNT> The special assessment rule included provisions to extend the collection period or cease collection early in response to changes to the estimated losses to the DIF or if assessments collected change due to corrective amendments to the amount of uninsured deposits reported for the December 31, 2022, reporting period. Specifically, the special assessment rule included provisions to allow the FDIC to extend the collection period over one or more quarters as needed to collect the difference between the amount collected after the initial eight collections and the estimated or actual losses at the end of the eight-quarter collection period. Conversely, if, prior to the end of the initial eight-quarter collection period, the estimated or actual losses are less than the amount collected, the special assessment rule included a provision to allow the FDIC to cease collection of the special assessment before the end of the initial eight-quarter collection period. However, pursuant to the special assessment rule, the FDIC is required to collect at a quarterly rate of 3.36 basis points until the FDIC has collected enough to recover actual or estimated loss ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 53k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━