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FDIC Federal Register Citations

[Federal Register: April 8, 1997 (Volume 62, Number 67)]
[Rules and Regulations]               
[Page 16662-16664]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08ap97_dat-2]
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FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Part 303
RIN 3064-AC03
 
Applications, Requests, Submittals, Delegations of Authority, and 
Notices Required to be Filed by Statute or Regulation
AGENCY: Federal Deposit Insurance Corporation.
ACTION: Final rule.
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SUMMARY: The Federal Deposit Insurance Corporation (FDIC) is amending 
the definition of ``appropriate FDIC regional office'' and other 
related terms contained in its applications regulation to change the 
way the FDIC designates the appropriate regional office for purposes of 
filing applications, requests, submittals, and notices. The amendment 
relates to a realignment of the FDIC's regional office operations. As a 
result, the FDIC Division of Supervision (DOS) and the Division of 
Compliance and Consumer Affairs (DCA) will supervise groups of related 
insured institutions from one FDIC regional office. The designated 
regional office for a group of institutions will, except in rare 
circumstances, be the one in which the group's major policy and 
decision makers are located. This location will coincide with the 
headquarters location of holding companies or lead institutions in most 
instances. Realigning operations in this manner will streamline 
supervision processes and simplify communication channels.
    All supervisory matters processed in regional offices, including 
applications and administrative actions, that involve insured 
institutions within a group of related institutions will be processed 
in the designated FDIC regional office. Applications will be submitted 
directly to the FDIC regional office assigned supervisory 
responsibility for the group. The regulation makes no change in the 
location of the appropriate region for institutions that are not part 
of a group or when a group of related institutions are located within 
one region.
EFFECTIVE DATE: This rule is effective April 8, 1997.
FOR FURTHER INFORMATION CONTACT: Christopher J. Spoth, Examination 
Specialist, Division of Supervision (202) 898-6611; David K. Mangian, 
Regional Director, Division of Compliance and Consumer Affairs (312) 
382-7550; Ken A. Quincy, Section Chief, Division of Compliance and 
Consumer Affairs (202) 942-3083; or Susan van den Toorn, Counsel, Legal 
Division (202) 898-8707.
[[Page 16663]]
SUPPLEMENTARY INFORMATION: The FDIC is amending 12 CFR 303.0(b)(12) 
regarding the definition of ``appropriate FDIC region'', ``appropriate 
FDIC regional office'', ``appropriate regional director'', 
``appropriate deputy regional director'', and ``appropriate regional 
counsel'' (collectively, ``appropriate region'') to permit groups of 
related insured institutions to be supervised by a single FDIC regional 
office. With regard to an insured institution or proposed institution 
that is not or will not be part of a group of related institutions, the 
appropriate FDIC region will continue to be the FDIC region in which 
the institution is or will be located.
    The amendment provides that the appropriate FDIC region for groups 
of related institutions will be the regional office in which the 
group's major policy and decision makers are located or any other 
region the FDIC designates on a case-by-case basis. In most cases 
involving related institutions, the appropriate FDIC region will be the 
region in which the headquarters of a lead institution or of a holding 
company is located. All supervisory matters, including applications and 
administrative actions, that involve insured institutions within a 
group of related institutions will be processed in the appropriate FDIC 
regional office.
    The phrase ``group of related insured institutions'' is used in the 
amended definition because it provides necessary flexibility to 
designate the appropriate regional office for supervisory purposes. 
Other more specific terms, such as ``affiliates'', or ``subsidiaries of 
the same bank holding company'', or ``commonly controlled 
institutions'', were considered. However, such terms or phrases are 
used in other regulations and do not capture the array of ownership and 
control relationships which will be considered ``related'' for purposes 
of establishing one FDIC regional office as the appropriate region for 
supervising a group of related institutions. For example, the owners of 
a group of institutions that are to be supervised together may be 
individuals, bank and thrift holding companies, nonregulated parent 
companies, and foreign owners, or any combination of these elements in 
multiple ownership tiers. Institutions related through ownership by 
individuals or entities other than holding companies may be affected, 
even where they are not commonly ``controlled'' for other regulatory 
purposes (e.g., Regulation O (12 CFR part 215), Change in Bank Control 
Act). Similarly, the phrase ``major policy and decision makers are 
located'' is used to designate the location of the appropriate FDIC 
regional office because other terms, such as ``holding company 
headquarters'' or ``location of the lead institution'' may not 
accurately describe the location where a group of related institutions 
locates its top managing officials.
    The provision to permit the FDIC to designate the appropriate 
regional office on a case-by-case basis is necessary to give the FDIC 
flexibility where using the location of the major policy and decision 
makers for determining the appropriate region is inappropriate or 
inefficient. The need for such language is demonstrated in the case of 
a foreign bank that operates several institutions in the United States, 
but whose headquarters, CEO, and major policy and decision makers are 
located in a foreign country. In such a case, the FDIC would have the 
discretion to select the most appropriate regional office to supervise 
the institutions located in the United States. Such flexibility is also 
needed in the case of a multibank holding company where major policy 
and decision makers are located in several FDIC regions. In such a 
case, the most logical region from a supervisory standpoint will be 
designated by DOS and DCA.
    A letter to all insured institutions will announce the realignment 
of DOS and DCA's regional office responsibilities. A separate 
explanatory letter will also be sent to each institution that, as a 
result of the realignment, will be supervised by a newly designated 
FDIC regional office. In the event an institution which is part of a 
group of related institutions inadvertently files an application with 
the wrong FDIC regional office, the FDIC will forward the document to 
the appropriate regional office and notify the institution without 
penalizing the institution for a misdirected filing. Each regional 
office has information available to advise insured institutions, 
applicants, the public, other regulators, and any interested party 
regarding identification of an institution's assigned FDIC regional 
office.
    The purpose of the realignment of FDIC regional office 
responsibilities and the amendment is to more efficiently supervise 
groups of related institutions by assigning responsibility for the 
group to one FDIC regional office based on the location of the group's 
major policy and decision makers. The prior part 303 language defines 
``appropriate'' to mean that the FDIC supervises institutions from the 
region in which the institution is located, regardless of where the 
parent company or any related institution in a group is located or 
where the group's major policy and decision makers are located. Over 
time, with the trend toward industry consolidation and interstate 
banking, this approach has become cumbersome for both the FDIC and for 
groups of related institutions that operate, or seek to operate, in 
more than one FDIC region. In such cases, every FDIC region in which a 
related institution operates is directly involved in the group's 
business and regulatory affairs, resulting in potential duplication of 
supervisory efforts and disorder in multiple communication channels.
    The changes to part 303 are being made to facilitate improved 
communications between insured institutions and the FDIC and to make 
better use of the FDIC's resources in processing applications and 
administrative actions for groups of related insured institutions. The 
changes do not create any insured institution publication requirements 
or impact the institution's or other respondent's right to challenge 
any action. The changes also do not impair access to the Board, to the 
extent it exists currently in part 303, for review of decisions on any 
application or administrative matter. The change in the appropriate 
region is procedural in nature. The designation of the FDIC office 
which will exercise overall supervision for purposes of receiving 
applications and deciding certain regulatory matters has no effect on 
the standards against which the merits of an application or 
administrative action are to be measured. In addition, any change as to 
the appropriate FDIC office in which overall supervisory functions will 
be assigned does not alter any of the rights or obligations of any 
institution or other respondent.
    The FDIC is also eliminating the term ``appropriate regional 
manager'' from its definition because the term is no longer a 
designated title used by the FDIC.
Exemption From Public Notice and Comment
    The amendments are being published in final form without 
opportunity for public comment under authority of 5 U.S.C. 553(b)(A) 
(Administrative Procedure Act) which exempts from required publication 
for comment interpretive rules, general statements of policy, and rules 
of agency practice and procedure. Specifically, the amendments relate 
to the FDIC's administrative and supervisory procedures concerning the 
designation of appropriate regional offices for purposes of filings and 
administrative actions. The amendments, which constitute nonsubstantive 
changes to the FDIC's Rules of Practice and Procedure, are being made 
immediately effective
[[Page 16664]]
inasmuch as the requirement found in 5 U.S.C. 553(d) that substantive 
rules be published not less than 30 days prior to their effective date 
is inapplicable.
Regulatory Flexibility Act
    Under section 605(b) of the Regulatory Flexibility Act (RFA) (5 
U.S.C. 605(b)), the final regulatory flexibility analysis otherwise 
required under section 604 of the RFA (5 U.S.C. 604) is not required if 
the head of the agency certifies that the rule will not have a 
significant economic impact on a substantial number of small entities 
and the agency publishes such certification in the Federal Register 
along with this general notice of proposed rulemaking or at the time of 
publication of the final rule.
    The Board of Directors has concluded after reviewing the final 
regulation that it will not have a significant economic impact on a 
substantial number of small institutions since the only change, if any, 
may be the location in which the institution will make filings and from 
which the institution will be supervised by the FDIC. The Board of 
Directors therefore hereby certifies pursuant to section 605 of the RFA 
that the regulation will not have a significant economic impact on a 
substantial number of small entities within the meaning of the RFA.
Small Business Regulatory Enforcement Fairness Act
    The Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA) (Public Law 104-121) provides generally for agencies to report 
rules to Congress and for Congress to review rules. This final rule is 
not a rule for purposes of SBREFA because it is a rule of agency 
organization pursuant to SBREFA, 5 U.S.C. 804(3)(c).
Paperwork Reduction Act
    As these amendments neither alter existing nor create new record 
keeping or reporting requirements, the Paperwork Reduction Act is 
inapplicable.
Cost Benefit Analysis
    This final rule is generally not expected to result in material 
increases in costs and burden to respondents. Some filers, however, 
will be required to file materials in a different location.
List of Subjects in 12 CFR Part 303
    Administrative practice and procedure, Authority delegations 
(Government agencies), Bank deposit insurance, Banks, Banking, 
Reporting and recordkeeping requirements, Savings associations.
    For the reasons set forth in the preamble, 12 CFR part 303 is 
amended as set forth below:
PART 303--APPLICATIONS, REQUESTS, SUBMITTALS, DELEGATIONS OF 
AUTHORITY, AND NOTICES REQUIRED TO BE FILED BY STATUTE OR 
REGULATION
    1. The authority citation for part 303 continues to read as 
follows:
    Authority: 12 U.S.C. 378, 1813, 1815, 1816, 1817(j), 1818, 1819 
(Seventh and Tenth), 1828, 1831e, 1831o, 1831p-1; 15 U.S.C. 1607.
    2. In Sec. 303.0, paragraph (b)(12) is revised to read as follows:
Sec. 303.0  Scope and definitions.
* * * * *
    (b) * * *
    (12) Appropriate FDIC region, appropriate FDIC regional office, 
appropriate regional director, appropriate deputy regional director, 
and appropriate regional counsel shall refer to the FDIC region, and 
the FDIC regional office, regional director, deputy regional director, 
and regional counsel, of the FDIC region, which the FDIC designates as 
follows:
    (i) When an institution or proposed institution that is the subject 
of an application, request, submittal, notice, or administrative action 
is not or will not be part of a group of related institutions, the 
appropriate region for the institution and any individual associated 
with the institution is the FDIC region in which the institution or 
proposed institution is or will be located; or
    (ii) When an institution or proposed institution that is the 
subject of an application, request, submittal, notice, or 
administrative action is or will be part of a group of related 
institutions, the appropriate region for the institution and any 
individual associated with the institution is the FDIC region in which 
the group's major policy and decision makers are located, or any other 
region the FDIC designates on a case-by-case basis.
* * * * *
    By Order of the Board of Directors.
    Dated at Washington, D.C., this 25th day of March, 1997.
Federal Deposit Insurance Corporation
Robert E. Feldman,
Deputy Executive Secretary.
[FR Doc. 97-8827 Filed 4-7-97; 8:45 am]
BILLING CODE 6714-01-P

Last Updated 04/08/1997 regs@fdic.gov

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