Deposit Insurance Assessments
Mergers, Acquisitions, & Branch Sale
- Merger Transaction - A merger is the acquisition or absorption of one healthy insured institution by another. Because the FDIC bills insurance premiums in arrears, the payment for a merger covers two billing quarters as explained below. Payment for both quarters is the responsibility of the surviving institution.
- Payment for the quarter prior to the merger
- Payment for the quarter in which the merger occurred
In a merger, the surviving institution is responsible for the final invoice of the outgoing institution. The final invoice is payment for the quarter prior to the merger transaction. For example, if a merger occurs on May 15, the final invoice of the outgoing institution is the invoice payable on June 30, based on March 31 Call Report data, and is payment for the first quarter of the year.
The final invoice of the outgoing institution will be available to the surviving institution on FDICconnect. The surviving institution’s authorized FDICconnect Coordinator(s) and/or User(s) will be able to download the invoice of an outgoing institution by following the instructions in the FDICconnect section of this webpage. If an outgoing institution does not appear on the surviving institution’s list of acquired institutions on FDICconnect, the surviving institution should contact the Assessments Section. Please have the details of your merger available – institution names, FDIC certificate numbers, and transaction date.
The survivor’s RTN and ACH account will be used to satisfy the payment for the survivor and any acquired institutions as listed on FDICconnect. The survivor is responsible for ensuring the accuracy of the ACH information on each invoice and ensuring that its authorized account is funded for the combined total of all invoices.
Schedule RC-O of the Call Report filed by the surviving institution for the quarter in which the merger occurred should average the Assets and Tier One Capital of both institutions for every day in that quarter. That is, the surviving institution should average the Assets and Tier One Capital as if the merger occurred on the first day of the quarter regardless of the actual merger date in the quarter, see: Section 327.6(b). By doing this, all the Assets and Tier One Capital will be included in the assessable base on the survivor’s quarterly invoice that bills for the quarter in which the merger occurred. For example:For additional assistance, an excerpt from the Call Report instructions for Schedule RC-O is attached. (RC-O Call Report)
A merger on May 15 would be treated as if it occurred on April 1 when the surviving institution is averaging Assets and Tier One Capital on its June 30 Call Report. Thus, when the surviving institution receives its September 30 invoice, (which is computed using the June 30 Call Report figures and charges for deposit insurance for the second quarter) the assessment base on the invoice will include all the Assets and Tier One Capital of both institutions for every day in the second quarter.
- Acquisition of a Failed Institution from the FDIC
In this situation, the acquiring institution is only purchasing and assuming certain assets and liabilities of a failed institution. Therefore, the acquiring institution is not responsible for unpaid assessments of the failed institution. Schedule RC-O for the Call Report filed by the acquiring institution for the quarter in which the acquisition occurred should average the Assets and Tier One Capital of both institutions beginning the day after the acquisition date.
- Branch Sales
With regard to the Call Report, Schedule RC-O, there are no special reporting requirements for branch sales. In branch sales, the seller stops including the assets of the branch at close of business on the sales date determined by the sales agreement, and the buyer begins including the acquired assets the next day. Therefore, all branch assets are accounted for in the quarter in which the branch sale took place.