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"Brokered" is not a 4-letter word!. Brokered Deposits can be a cost-effective funding source, often times less expensive than other funding sources. As far as a liquidity source, they are especially important to community banks in our present economic environment. The benchmarks of 10% brokered and 20% growth are unrealistically low and are in no way reflective of risk to the deposit insurance fund. For banks that have been established for over 10 years, the 20% growth limitation seems more reasonable.
Deposits gathered from listing services should be treated the same as those gathered from normal marketing/advertising. They should not be counted as brokered deposits!
Dennis M. King
|Last Updated 11/06/2008||Regs@fdic.gov|