FDIC proposes new deposit insurance requirements for community banks

Yesterday the FDIC issued a Notice of Proposed Rulemaking that would modify the deposit insurance assessment system for small banks (those with less than $10 billion in assets). The new proposal is a modification from a June 2015 rulemaking notice. The new proposal would revise the one-year asset growth measure, use a brokered deposit ratio instead of a core deposit ratio for established small banks, remove the exiting brokered deposit adjustment that applies to banks outside Risk Category I, and revise the weights assigned to the proposed measures in the financial ratios method. Although these are not drastic changes, they slightly relax some of the regulatory requirements imposed on community banks.