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FDIC Federal Register Citations |
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Capital One Financial Corporation 2980 Fairview Park Drive Suite 1300 Falls Church, VA 22042-4525 703-205-1030 FAX 703-205-1094 July 11, 2001 Federal Deposit Insurance Corporation 550 17th Street, NW Mail Stop 1-5 Washington, DC 20429 Attn: Robert E. Feldman Executive Secretary Comments/OES Re: Interpretation of Federal Deposit Insurance Act -- Business of Receiving Deposits Ladies and Gentlemen: Thank you very much for providing Capital One the opportunity to comment on the proposed regulation issued by the Federal Deposit Insurance Corporation (the "FDIC") clarifying what constitutes "the business of receiving deposits other than trust deposits," a standard used throughout the Federal Deposit Insurance Act (the "FDIA"). Capital One Financial Corporation, Falls Church, Virginia (together, with all of its subsidiaries and affiliates, "Capital One") is a holding company whose principal subsidiaries, Capital One Bank, Glen Allen, Virginia and Capital One, F.S.B., Falls Church, Virginia, offer consumer lending and deposit products, including credit cards, installment loans, and automobile financing. Both of these principal subsidiaries hold deposits that are FDIC-insured. Capital One had 36.5 million customers and $31.6 billion in managed loans outstanding, as of March 31, 2001. A Fortune 500 company, Capital One is one of the largest providers of MasterCard and Visa credit cards in the world. Capital One would like to express its support for the FDIC's proposal. The FDIC has proposed that an insured depository institution may satisfy the threshold requirement for receiving the benefits (and bearing the responsibilities) of federal deposit insurance "by the continuous maintenance of one or more non-trust deposit accounts in the aggregate amount of $500,000." 66 FR 20102. The FDIC's proposed standard would have a minimal impact on Capital One's state-chartered credit card bank (Capital One Bank), because Capital One Bank accepts "jumbo CD" deposits from the general public in amounts equal to and exceeding $100,000. Capital One agrees that an institution that continuously maintains $500,000 or more in non-trust deposits should be deemed "engaged in the business of receiving deposits other than trust funds" for the purposes of the FDIA. The source from which the bank obtains those funds, the types of accounts offered by the bank, and the number of accounts held by the bank should not be relevant to the standard. We agree that the FDIC's proposed $500,000 requirement is workable and will provide certainty to the broad variety of institutions that currently carry deposit insurance. Capital One appreciates the FDIC's reasoned effort to provide an interpretation of the disputed standard that may be uniformly applied throughout the FDIA and in the courts. We thank you again for allowing us the opportunity to comment on the proposed regulation, and please do not hesitate to contact us if you have any questions. Respectfully submitted, /s/ Frank R. Borchert, III Frank R. Borchert, III Deputy General Counsel Capital One Financial Corporation |
| Last Updated 07/12/2001 | regs@fdic.gov |