Federal Deposit
Insurance Corporation

Citizens Financial Group

MEMORANDUM TO:          Office of the Executive Secretary

FROM:                              Kymberly K. Copa, Counsel, Legal Division, FDIC
                 
SUBJECT:  Memorandum Memorializing Meeting Between FDIC Staff and Representatives of Citizens Financial Group on the One-time Assessment Credit Required by the Deposit Insurance Reform Act of 2006   

Please include this memorandum and the attached handout - PDF 135k (PDF Help) provided by Citizens Financial Group (Citizens) in the public file on the Notice of Proposed Rulemaking on the One-time Assessment Credit.   

On May 4, 2006, representatives of Citizens met with FDIC staff to discuss the one-time assessment credit required by the Deposit Insurance Reform Act of 2006.  This memorandum memorializes the substance of that meeting and a copy of Citizens' handout is attached.   

Specifically, the representatives of Citizens discussed their views as to how "successor" should be defined for purposes of allocating the one-time assessment credit among eligible insured depository institutions.  As reflected in the attachment, Citizens noted the wide latitude that Congress afforded the FDIC in the requirement to define "successor" by regulation and argued that Congress did that to allow institutions, which acquired deposits other than through stock mergers, to receive credits. 

Citizens identified four factors that it believed should be considered in defining "successor" -- tracking; burden; equity; and defensible and consistent determinations -- and offered their views as to how those factors should be applied to their transactions.   As set forth in the attachment, Citizens suggested possible methods for identifying and tracking deposits, imposing the burden on petitioning parties to identify and track deposits, recognizing that any methodology should be applied similarly to any transaction and include the use of publicly available information.  It should be noted that the handout indicates that the FDIC already has information on the defined universe of deposit acquisitions since 1996.  However, FDIC staff clarified that, while it has some relevant data, such data is not routinely validated and maintained.

Attachment - PDF 135k (PDF Help)