FDIC Finalizes Change of Control Rules

On December 16, the Federal Deposit Insurance Corporation (FDIC) issued Financial Institution Letter 60-2015, which summarizes a final rule with respect to non-member banks, state savings and loan associations, and certain holding companies.

The final rule:

consolidates and conforms the change in control regulation of state savings associations, and rescinds the change in control regulation and guidance transferred from the Office of Thrift Supervision;
adopts presumptions of acting in concert consistent with the other federal banking agencies;
adopts definitions for previously undefined terms, such as “voting securities;”
adopts a rebuttable presumption that the acquisition of convertible securities, options or warrants is presumed to constitute the acquisition of voting securities;
requires, unless waived by the FDIC, a person who has been approved to acquire control of a covered institution and who has maintained that control to file a second notice if that person’s ownership, control or power to vote will increase to 25 percent or more of any class of voting securities; and
establishes reporting requirements for stock loans held by foreign banks and their affiliates, and for a new CEO or director of a bank following a change in control.

The rule will become effective on January 1, 2016.