8104 Federal Register / Vol. 86, No. 21 / Wednesday, February 3, 2021 / Rules and Regulations 

1 Dodd-Frank Wall Street Reform and Consumer 

Protection Act, Public Law 111–203, 124 Stat. 1376 

(2010) (codified at 12 U.S.C. 5301 et seq.). 

2Codified at 12 U.S.C. 5411. 

3Codified at 12 U.S.C. 5414(b). 

regulations that impose additional 

reporting, disclosures, or other new 

requirements on IDIs generally to take 

effect on the first day of a calendar 

quarter that begins on or after the date 

on which the regulations are published 

in final form. 

Because the final rule does not 

impose additional reporting, disclosure, 

or other requirements on IDIs, section 

302 of RCDRIA does not apply. 

List of Subjects 

12 CFR Part 362 

Administrative practice and 

procedure, Authority delegations 

(Government agencies), Bank deposit 

insurance, Banks, Banking, Investments, 

Reporting and recordkeeping 

requirements. 

12 CFR Part 390 

Administrative practice and 

procedure, Advertising, Aged, Civil 

rights, Conflict of interests, Credit, 

Crime, Equal employment opportunity, 

Fair housing, Government employees, 

Individuals with disabilities, Reporting 

and recordkeeping requirements, 

Savings associations. 

Authority and Issuance 

For the reasons stated in the 

preamble, the Federal Deposit Insurance 

Corporation amends 12 CFR parts 362 

and 390 as follows: 

PART 362—ACTIVITIES OF INSURED 

STATE BANKS AND INSURED 

SAVINGS ASSOCIATIONS 

■ 1. The authority citation for part 362 

continues to read as follows: 

Authority: 12 U.S.C. 1816, 1818, 

1819(a)(Tenth), 1828(j), 1828(m), 1828a, 

1831a, 1831e, 1831w, 1843(l). 

■ 2. Revise § 362.15 to read as follows: 

§ 362.15 Acquiring or establishing a 

subsidiary; conducting new activities 

through a subsidiary. 

No state insured savings association 

may establish or acquire a subsidiary, or 

conduct any new activity through a 

subsidiary, unless it files a notice in 

compliance with § 303.142(c) of this 

chapter at least 30 days prior to 

establishment of the subsidiary or 

commencement of the activity and the 

FDIC does not object to the notice. This 

section does not apply to any state 

savings association that acquired its 

principal assets from a Federal savings 

bank that was chartered prior to October 

15, 1982, as a savings bank under state 

law. 

PART 390—REGULATIONS 

TRANSFERRED FROM THE OFFICE OF 

THRIFT SUPERVISION 

■ 3. The authority citation for part 390 

continues to read as follows: 

Authority: 12 U.S.C. 1819. 

Subpart Q also issued under 12 U.S.C. 

1462; 1462a; 1463; 1464. 

Subpart W also issued under 12 U.S.C. 

1462a; 1463; 1464; 15 U.S.C. 78c; 78l; 78m; 

78n; 78p; 78w. 

Subpart O—[Removed and Reserved] 

■ 4. Remove and reserve subpart O, 

consisting of §§ 390.250 through 

390.255. 

Federal Deposit Insurance Corporation. 

By order of the Board of Directors. 

Dated at Washington, DC, on December 15, 

2020. 

James P. Sheesley, 

Assistant Executive Secretary. 

[FR Doc. 2020–28454 Filed 2–2–21; 8:45 am] 

BILLING CODE 6714–01–P 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Parts 308 and 390 

RIN 3064–AF38 

Removal of Transferred OTS 

Regulations Regarding Prompt 

Corrective Action Directives and 

Conforming Amendments to Other 

Regulations 

AGENCY: Federal Deposit Insurance 

Corporation. 

ACTION: Final rule. 

SUMMARY: The Federal Deposit 

Insurance Corporation (FDIC) is 

adopting a final rule to rescind and 

remove from the Code of Federal 

Regulations rules entitled ‘‘Prompt 

Corrective Action’’ that were transferred 

to the FDIC from the Office of Thrift 

Supervision (OTS) on July 21, 2011, in 

connection with the implementation of 

Title III of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act 

(Dodd-Frank Act) and amend certain 

sections of existing FDIC regulations 

governing the issuance and review of 

orders pursuant to the prompt corrective 

action provisions of the Federal Deposit 

Insurance Act to make it clear that such 

rules apply to all insured depository 

institutions for which the FDIC is the 

appropriate Federal banking agency. 

DATES: The final rule is effective on 

March 5, 2021. 

FOR FURTHER INFORMATION CONTACT: 

Robert Watkins, Review Examiner, 

RoWatkins@FDIC.gov, Division of Risk 

Management Supervision, (202) 898– 

3865; Seth Rosebrock, Assistant General 

Counsel, Legal Division, (202) 898– 

6609, srosebrock@FDIC.gov; or Kristine 

Schmidt, Counsel, Legal Division, (202) 

898–6686, krschmidt@fdic.gov. 

SUPPLEMENTARY INFORMATION: 

I. Policy Objective 

The policy objective of the rule is to 

remove unnecessary and duplicative 

regulations in order to simplify them 

and improve the public’s understanding 

of them. Part 390, subpart Y, outlines 

administrative procedures related to 

prompt corrective action that are 

equivalent to procedures outlined in 

part 308, subpart Q, of the FDIC’s 

existing regulations. Thus, the FDIC is 

rescinding the regulations in part 390, 

subpart Y, and reserving the subpart for 

future use. In addition, the FDIC is 

amending certain sections of part 308, 

subpart Q, of the FDIC’s existing 

regulations on the issuance and review 

of orders pursuant to the prompt 

corrective action provisions of the 

Federal Deposit Insurance Act to make 

it clear that part 308, subpart Q, applies 

to all insured depository institutions for 

which the FDIC is the appropriate 

Federal banking agency. 

II. Background 

Part 390, subpart Y, was included in 

the regulations that were transferred to 

the FDIC from the Office of Thrift 

Supervision (OTS) on July 21, 2011, in 

connection with the implementation of 

applicable provisions of title III of the 

Dodd-Frank Wall Street Reform and 

Consumer Protection Act (Dodd-Frank 

Act).1

A. The Dodd-Frank Act 

As of July 21, 2011, the transfer date 

established by section 311 of the DoddFrank Act,2 the powers, duties, and 

functions formerly performed by the 

OTS were divided among the FDIC, as 

to State savings associations, the Office 

of the Comptroller of the Currency 

(OCC), as to Federal savings 

associations, and the Board of 

Governors of the Federal Reserve 

System (FRB), as to savings and loan 

holding companies. Section 316(b) of 

the Dodd-Frank Act 3 provides the 

manner of treatment for all orders, 

resolutions, determinations, regulations, 

and other advisory materials that had 

been issued, made, prescribed, or 

allowed to become effective by the OTS. 


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Federal Register / Vol. 86, No. 21 / Wednesday, February 3, 2021 / Rules and Regulations 8105 

4Codified at 12 U.S.C. 5414(c). 

5 76 FR 39246 (July 6, 2011). 

6Codified at 12 U.S.C. 5412(b)(2)(B)(i)(II). 

7 12 U.S.C. 1811 et seq. 

8Codified at 12 U.S.C. 5412(c)(1). 

9 12 U.S.C. 1813(q). 

10 76 FR 47652 (Aug. 5, 2011). 

11See 76 FR 47653. 

12 85 FR 60738 (Sept. 28, 2020). 13 12 U.S.C. 5412(b)(1). 

The section provides that if such 

materials were in effect on the day 

before the transfer date, they continue in 

effect and are enforceable by or against 

the appropriate successor agency until 

they are modified, terminated, set aside, 

or superseded in accordance with 

applicable law by such successor 

agency, by any court of competent 

jurisdiction, or by operation of law. 

Pursuant to section 316(c) of the 

Dodd-Frank Act,4 on June 14, 2011, the 

FDIC’s Board of Directors (Board) 

approved a ‘‘List of OTS Regulations to 

be Enforced by the OCC and the FDIC 

Pursuant to the Dodd-Frank Wall Street 

Reform and Consumer Protection Act.’’ 

This list was published by the FDIC and 

the OCC as a Joint Notice in the Federal 

Register on July 6, 2011.5

Although section 312(b)(2)(B)(i)(II) of 

the Dodd-Frank Act 6 granted the OCC 

rulemaking authority relating to both 

State and Federal savings associations, 

nothing in the Dodd-Frank Act affected 

the FDIC’s existing authority to issue 

regulations under the Federal Deposit 

Insurance Act (FDI Act) 7 and other laws 

as the ‘‘appropriate Federal banking 

agency’’ or under similar statutory 

terminology. Section 312(c)(1) of the 

Dodd-Frank Act 8 revised the definition 

of ‘‘appropriate Federal banking 

agency’’ contained in section 3(q) of the 

FDI Act,9 to add State savings 

associations to the list of entities for 

which the FDIC is designated as the 

‘‘appropriate Federal banking agency.’’ 

As a result, when the FDIC acts as the 

appropriate Federal banking agency (or 

under similar terminology) for State 

savings associations, as it does here, the 

FDIC is authorized to issue, modify, and 

rescind regulations involving such 

associations, as well as for State 

nonmember banks and insured Statelicensed branches of foreign banks. 

As noted above, on June 14, 2011, 

operating pursuant to this authority, the 

Board issued a list of regulations of the 

former OTS that the FDIC would enforce 

with respect to State savings 

associations. On that same date, the 

Board reissued and redesignated certain 

regulations transferred from the former 

OTS. These transferred OTS regulations 

were published as new FDIC regulations 

in the Federal Register on August 5, 

2011.10 When the FDIC republished the 

transferred OTS regulations as new 

FDIC regulations, it specifically noted 

that its staff would evaluate the 

transferred OTS rules and might later 

recommend incorporating the 

transferred OTS regulations into other 

FDIC regulations, amending them, or 

rescinding them, as appropriate.11

B. Transferred OTS Regulations 

(Transferred to the FDIC’s Part 390, 

Subpart Y) 

A subset of the regulations transferred 

to the FDIC from the OTS concerns 

prompt corrective action provisions 

applicable to State savings associations. 

The OTS regulations, formerly found at 

12 CFR part 565, §§ 565.7, 565.8, 565.9 

and 565.10, were transferred to the FDIC 

with only nomenclature changes and 

now comprise part 390, subpart Y. Each 

provision of part 390, subpart Y, is 

discussed in Part III of this 

SUPPLEMENTARY INFORMATION section, 

below. The FDIC has conducted a 

careful review and comparison of part 

390, subpart Y. As discussed in Part III 

of this SUPPLEMENTARY INFORMATION

section, the FDIC is rescinding part 390, 

subpart Y, because the FDIC considers 

the provisions related to State savings 

associations contained in part 390, 

subpart Y, substantially similar to 

similar regulations related to state nonmember banks. The FDIC will combine 

the regulations to make clear the same 

procedures apply to all FDIC-supervised 

institutions. 

III. Proposed Rule 

On September 28, 2020, the FDIC 

published a notice of proposed 

rulemaking (NPR) regarding the removal 

of part 390, subpart Y (formerly OTS 12 

CFR part 565, §§ 565.7, 565.8, 565.9 and 

565.10), which addressed prompt 

corrective action provisions applicable 

to State savings associations.12 The NPR 

proposed removing part 390, subpart Y, 

from the Code of Federal Regulations, 

because, after careful review, the FDIC 

concluded that the retention of part 390, 

subpart Y, is unnecessary and that 

rescission of subpart Y in its entirety 

would streamline the FDIC rules and 

regulations. The regulations related to 

State savings associations will be 

incorporated into part 308, subpart Q as 

described below. Part 390, subpart Y, 

also references savings and loan holding 

companies. When the regulation was 

transferred from the OTS, the references 

to ‘‘any company that controls the State 

savings association’’ were not deleted 

with the other technical amendments. 

The FDIC is not the appropriate 

successor agency for supervision of 

savings and loan holding companies. 

Under the Dodd-Frank Act, supervision 

of savings and loan holding companies 

was transferred to the Federal Reserve 

Board.13 The provisions in the FDIC 

regulations relating to ‘‘any company 

that controls the State savings 

association’’ will therefore be set aside 

and not incorporated into the existing 

FDIC regulations at part 308, subpart Q, 

addressing FDIC-supervised 

institutions. 

Consistent with its legal authority to 

issue and modify regulations as the 

appropriate Federal banking agency 

under section 3(q) of the Federal 

Deposit Insurance Act, the FDIC also 

proposed to amend and revise 

provisions of part 308, subpart Q, to 

clarify and state explicitly the 

regulations apply to all FDIC-supervised 

institutions. 

A. Comparison of Other Applicable 

Statutes and Regulations With the 

Transferred OTS Regulations To Be 

Rescinded 

12 CFR 390.456—Directives To Take 

Prompt Corrective Action 

Section 390.456 describes the 

administrative procedures for the FDIC 

to issue a directive to take prompt 

corrective action against a State savings 

association. These administrative 

procedures were initially found at 12 

CFR 565.7 and are equivalent to the 

administrative procedures relating to 

FDIC-supervised banks found at 12 CFR 

308.201. 

The FDIC proposed that § 390.456 be 

rescinded in its entirety. The 

amendments to subpart Q will clarify in 

a single location that the regulations 

apply to all FDIC-supervised 

institutions. Therefore, it is not 

necessary to have a regulation 

specifically applicable to State savings 

associations. 

12 CFR 390.457—Procedures for 

Reclassifying a State Savings 

Association Based on Criteria Other 

Than Capital 

Section 390.457 describes the 

administrative procedures to reclassify a 

State savings association based on 

criteria other than capital. This section 

describes how the FDIC may consider 

other unsafe or unsound practices to 

lower a State saving association’s capital 

category under part 324. The section 

also details the procedures for notifying 

the State saving association and 

contesting the determination. These 

administrative procedures were initially 

found at 12 CFR 565.8 and were 

recently modified to account for 


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8106 Federal Register / Vol. 86, No. 21 / Wednesday, February 3, 2021 / Rules and Regulations 

14See 83 FR 17737. 

15See section 312(c) of the Dodd-Frank Act, 

codified at 12 U.S.C. 1813(q). 

16 12 U.S.C. 1813(q). 17Call Report data, June 30, 2020. 

changes made to part 324.14 Section 

390.457 is equivalent to the 

administrative procedures relating to 

FDIC-supervised banks found at 12 CFR 

308.202. 

The FDIC proposed that § 390.457 be 

rescinded in its entirety. The 

amendments to subpart Q will clarify in 

a single location that the regulations 

apply to all FDIC-supervised 

institutions. Therefore, it is not 

necessary to have a regulation 

specifically applicable to State savings 

associations. 

12 CFR 390.458—Order To Dismiss a 

Director or Senior Executive Officer 

Section 390.458 describes the 

additional administrative procedures 

related to prompt corrective action 

directives that require the State savings 

association to terminate the 

employment of a director or officer. This 

section also includes provisions to 

challenge this type of prompt corrective 

order directive. These administrative 

procedures were initially found at 12 

CFR 565.9. Section 390.458 is 

equivalent to the administrative 

procedures relating to FDIC-supervised 

banks found at 12 CFR 308.203. 

The FDIC proposed that § 390.458 be 

rescinded in its entirety. The 

amendments to subpart Q will clarify in 

a single location that the regulations 

apply to all FDIC-supervised 

institutions. Therefore, it is not 

necessary to have a regulation 

specifically applicable to State savings 

associations 

12 CFR 390.459—Enforcement of 

Directives 

Section 390.459 describes the 

additional remedies the FDIC may take 

to seek compliance with prompt 

corrective action directives. These 

procedures were initially found at 12 

CFR 565.10. Section 390.459 is 

equivalent to the administrative 

procedures relating to FDIC-supervised 

banks found at 12 CFR 308.204. 

The FDIC proposed that § 390.459 be 

rescinded in its entirety. The 

amendments to subpart Q will clarify in 

a single location that the regulations 

apply to all FDIC-supervised 

institutions. Therefore, it is not 

necessary to have a regulation 

specifically applicable to State savings 

associations. 

B. Changes to FDIC Regulations 

As discussed in part III of this 

SUPPLEMENTARY INFORMATION, the FDIC’s 

part 308, subpart Q, addresses the 

administrative procedures related to the 

issuance and enforcement of prompt 

corrective action directives. The DoddFrank Act added State savings 

associations to the list of entities for 

which the FDIC is designated as the 

appropriate Federal banking agency.15

To clarify that part 308, subpart Q, 

applies to all institutions for which the 

FDIC is the appropriate Federal banking 

agency, the FDIC proposed to amend 

§§ 308.200 through 308.204 to replace 

the phrases ‘‘banks’’ and ‘‘insured 

branches of foreign banks’’ throughout 

subpart Q with the phrase ‘‘FDICsupervised institution.’’ Section 308.200 

will be revised to add the definition of 

the term ‘‘FDIC-supervised institution’’ 

to mean any insured depository 

institution for which the FDIC is the 

appropriate Federal banking agency 

pursuant to section 3(q) of the FDI 

Act.16

Additionally, the FDIC proposed one 

additional change to conform the FDIC’s 

regulations relating to prompt corrective 

action directives that apply to banks and 

the former OTS regulations relating to 

State savings associations. Sections 

308.202 and 390.457 describe the 

procedures relating to classifying an 

institution due to something other than 

capital. These two regulations differ in 

one respect. The FDIC regulation at 

§ 308.202(a)(6) provides that when a 

hearing is ordered, it will begin no later 

than 30 days from the date of the 

request unless the bank requests a later 

date. The former OTS version of this 

regulation, incorporated by the FDIC at 

§ 390.457, provides that the hearing 

should be ordered within 30 days of 

request unless the FDIC allows further 

time at the request of the State savings 

association. While both of these 

provisions demonstrate that a hearing is 

likely to be delayed at the request of the 

institution, the former OTS version of 

the regulation is written with greater 

clarity that the FDIC will evaluate and 

may then provide consent to the 

request. The OTS version of the 

regulation makes it clear that there is no 

automatic extension granted to the 

institution. The greater clarity in this 

language makes it the preferred choice 

when reconciling the two regulations 

into one regulation that applies to all 

FDIC-supervised institutions. The 

changes to this aspect of the regulation 

will provide greater clarity to those 

institutions going forward. 

IV. Comments 

The FDIC issued the NPR with a 30- 

day comment period, which closed on 

October 28, 2020. The FDIC received no 

comments on its NPR, and consequently 

the FDIC is adopting the amendments as 

proposed. 

V. Explanation of the Final Rule 

As discussed in the NPR, the 

requirements for State savings 

associations in part 390, subpart Y, are 

largely unnecessary, redundant, or 

duplicative of existing FDIC regulations. 

To that effect, the Final Rule removes 

and rescinds 12 CFR part 390, subpart 

Y, and amends the FDIC’s requirements 

of part 308, subpart Q to expressly apply 

to all FDIC-supervised insured 

depository institutions. These initiatives 

will serve to streamline the FDIC’s 

regulations. 

VI. Expected Effects 

As explained in detail in Section III 

of this SUPPLEMENTARY INFORMATION

section, certain OTS regulations 

transferred to the FDIC by the DoddFrank Act relating to prompt corrective 

action directives are either unnecessary 

or effectively duplicate existing FDIC 

regulations. This rule will eliminate 

those transferred OTS regulations. The 

rule will also clarify that the standards 

in part 308, subpart Q, apply to State 

savings associations because the FDIC is 

the ‘‘appropriate Federal banking 

agency’’ pursuant to the FDI Act. As of 

June 30, 2020, the FDIC supervised 

3,270 depository institutions, of which 

35 (1.1 percent) are State savings 

associations.17 The rule primarily 

would affect regulations that govern 

State savings associations. 

As explained previously, the rule 

would rescind 12 CFR part 390, subpart 

Y, which includes the following: 

§ 390.456, which outlines 

administrative procedures for issuing a 

directive to take prompt corrective 

action against a State savings 

association; § 390.457, which outlines 

administrative procedures for 

reclassifying a State savings association 

based on criteria other than capital; 

§ 390.458, which outlines 

administrative procedures related to 

prompt corrective action that require a 

State savings association to terminate 

the employment of a director or officer; 

and § 390.459, which outlines 

administrative procedures the FDIC may 

take to seek compliance with prompt 

corrective action directives. The FDIC 

has determined that these sections of 12 

CFR part 390 are equivalent to 

regulations related to prompt corrective 

action in the FDIC’s existing regulations. 

Therefore, the FDIC does not expect the 

removal of the regulations in subpart Y 


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Federal Register / Vol. 86, No. 21 / Wednesday, February 3, 2021 / Rules and Regulations 8107 

18 44 U.S.C. 3501–3521. 19 5 U.S.C. 601, et seq. 

20The SBA defines a small banking organization 

as having $600 million or less in assets, where ‘‘a 

financial institution’s assets are determined by 

averaging the assets reported on its four quarterly 

financial statements for the preceding year.’’ See 13 

CFR 121.201 (as amended by 84 FR 34261, effective 

August 19, 2019). ‘‘SBA counts the receipts, 

employees, or other measure of size of the concern 

whose size is at issue and all of its domestic and 

foreign affiliates.’’ See 13 CFR 121.103. Following 

these regulations, the FDIC uses a covered entity’s 

affiliated and acquired assets, averaged over the 

preceding four quarters, to determine whether the 

FDIC-supervised institution is ‘‘small’’ for the 

purposes of RFA. 

21FDIC-supervised institutions are set forth in 12 

U.S.C. 1813(q)(2). 

22FDIC Call Report data, June 30, 2020. 

23 Id. 

to significantly affect FDIC-supervised 

State savings associations. 

The final rule would also amend the 

FDIC’s regulations that establish 

administrative procedures for prompt 

corrective action in 12 CFR 308.200 

through 308.204 to make them 

applicable to all FDIC-supervised 

institutions, including State savings 

associations. As discussed previously, 

these changes would not change the 

required procedures related to prompt 

corrective action that are applicable to 

State savings associations since the 

requirements in subpart Y are 

equivalent to requirements in the FDIC’s 

existing regulations; therefore this 

aspect of the rule is unlikely to 

substantively affect FDIC-supervised 

State savings associations. 

Finally, the rule revises 12 CFR 

308.202 to clarify the procedures for 

delaying a hearing if an institution is 

reclassified based on criteria other than 

capital. The FDIC’s regulation currently 

states that if a hearing is scheduled, it 

will be held within 30 days of the 

request unless the institution requests a 

later date. The regulations in § 390.457 

state that a hearing will be held within 

30 days of the request unless the FDIC 

allows further time at the request of the 

institution. The FDIC is adopting the 

language from § 390.457 in its own 

regulations since § 390.457 clarifies that 

requests for an extension will not be 

automatically granted. This aspect of the 

rule will pose no change for the 35 

FDIC-supervised State savings 

associations. The FDIC believes that 

adopting the language from § 390.457 

should further clarify for State 

nonmember institutions that requests 

for an extension will not automatically 

be granted, however, this change is 

unlikely to pose any substantive effects 

on State nonmember institutions. 

Since the prompt corrective action 

directive provisions in part 390, subpart 

Y, are substantively similar to existing 

regulations for state nonmember banks 

found in part 308, subpart Q, the FDIC 

does not believe that rescission of 

§§ 390.456 through 390.459 would have 

any substantive effects on FDICsupervised State savings associations. 

VII. Alternatives 

The FDIC believes that the 

amendments represent the most 

appropriate option for covered 

institutions and, at this time, has not 

identified significant alternatives to the 

rule in its current form. As discussed 

previously, the Dodd-Frank Act 

transferred certain powers, duties, and 

functions formerly performed by the 

OTS to the FDIC. The FDIC’s Board 

reissued and redesignated certain 

transferred regulations from the OTS but 

noted that it would evaluate them and 

might later incorporate them into other 

FDIC regulations, amend them, or 

rescind them, as appropriate. The FDIC 

has evaluated the existing regulations 

relating to prompt corrective actions, 

including part 308, subpart Q, and part 

390, subpart Y. The FDIC has available 

the status quo alternative of retaining 

the current regulations but is not 

choosing to do so because it would be 

needlessly duplicative for substantively 

similar regulations regarding prompt 

corrective action directives for banks 

and State savings associations to be 

located in different locations within the 

Code of Federal Regulations. The FDIC 

believes it would be redundant and 

potentially confusing for FDICsupervised institutions to continue to 

refer to these separate sets of regulations 

and is therefore amending and 

streamlining them in accordance with 

this final rulemaking. 

VIII. Regulatory Analysis and 

Procedure 

A. The Paperwork Reduction Act 

In accordance with the requirements 

of the Paperwork Reduction Act of 1995 

(PRA),18 the FDIC may not conduct or 

sponsor, and the respondent is not 

required to respond to, an information 

collection unless it displays a currently 

valid Office of Management and Budget 

(OMB) control number. 

The final rule rescinds and removes 

from FDIC regulations part 390, subpart 

Y. With regard to part 308, subpart Q, 

the final rule amends §§ 308.200 

through 308.204 to clarify that State 

savings associations, as well as State 

nonmember banks and foreign banks 

having insured branches are all subject 

to part 308, subpart Q. The final rule 

will not create any new or revise any 

existing collections of information 

under the PRA. Therefore, no 

information collection request will be 

submitted to the OMB for review. 

B. The Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA), 

requires that, in connection with a 

notice of final rulemaking, an agency 

prepare and make available for public 

comment a final regulatory flexibility 

analysis that describes the impact of the 

final rule on small entities.19 However, 

a regulatory flexibility analysis is not 

required if the agency certifies that the 

rule will not have a significant 

economic impact on a substantial 

number of small entities and publishes 

its certification and a short explanatory 

statement in the Federal Register 

together with the rule. The Small 

Business Administration (SBA) has 

defined ‘‘small entities’’ to include 

banking organizations with total assets 

of less than or equal to $600 million.20

Generally, the FDIC considers a 

significant effect to be a quantified effect 

in excess of 5 percent of total annual 

salaries and benefits per institution, or 

2.5 percent of total noninterest 

expenses. The FDIC believes that effects 

in excess of these thresholds typically 

represent significant effects for FDICsupervised institutions. For the reasons 

provided below, the FDIC certifies that 

the rule will not have a significant 

economic impact on a substantial 

number of small entities. Accordingly, a 

regulatory flexibility analysis is not 

required. 

As of June 30, 2020, the FDIC 

supervised 3,270 depository 

institutions,21 of which 2,492 were 

considered small entities for the 

purposes of RFA.22 There are 33 State 

savings associations that are small 

entities for the purposes of RFA, or 1.3 

percent of all depository institutions 

considered small entities.23 As 

discussed previously, the rule rescinds 

12 CFR part 390, subpart Y, which 

includes the following: § 390.456, which 

outlines administrative procedures for 

issuing a directive to take prompt 

corrective action against a State savings 

association; § 390.457, which outlines 

administrative procedures for 

reclassifying a State savings association 

based on criteria other than capital; 

§ 390.458, which outlines 

administrative procedures related to 

prompt corrective action that require a 

State savings association to terminate 

the employment of a director or officer; 

and § 390.459, which outlines 

administrative procedures the FDIC may 

take to seek compliance with prompt 

corrective action directives. The FDIC 

has determined that these sections of 12 

CFR part 390 are equivalent to 

regulations related to prompt corrective 


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24Codified at 5 U.S.C. 801 et seq. 

25Codified at 5 U.S.C. 801(a)(3). 

26Codified at 5 U.S.C. 804(2). 

27Public Law 106–102, section 722, 113 Stat. 

1338, 1471 (codified at 12 U.S.C. 4809). 

28Public Law 104–208, 110 Stat. 3009 (1996). 

29 82 FR 15900 (March 31, 2017). 

30 12 U.S.C. 4802(a). 

31 Id. 

action in the FDIC’s existing regulations. 

Therefore, the FDIC does not expect the 

removal of the regulations in subpart Y 

to significantly affect small FDICsupervised State savings associations. 

The final rule also amends the FDIC’s 

regulations that establish administrative 

procedures for prompt corrective action 

in 12 CFR 308.200 through 308.204 to 

make them applicable to all FDICsupervised institutions, including State 

savings associations. As discussed 

previously, these changes would not 

change the required procedures related 

to prompt corrective action that are 

applicable to small State savings 

associations since the requirements in 

subpart Y are equivalent to 

requirements in the FDIC’s existing 

regulations. 

Finally, the rule revises 12 CFR 

308.202 to clarify the procedures for 

delaying a hearing if an institution is 

reclassified based on criteria other than 

capital. The FDIC’s regulation currently 

states that if a hearing is scheduled, it 

will be held within 30 days of the 

request unless the institution requests a 

later date. The regulations in § 390.457 

state that a hearing will be held within 

30 days of the request unless the FDIC 

allows further time at the request of the 

institution. The FDIC is adopting the 

language from § 390.457 in its own 

regulations since § 390.457 clarifies that 

requests for an extension will not be 

automatically granted. This aspect of the 

rule will pose no change for the 33 

small FDIC-supervised State savings 

associations. The FDIC believes that 

adopting the language from § 390.457 

should further clarify for small State 

nonmember institutions that requests 

for an extension will not automatically 

be granted; however, this change is 

unlikely to pose any substantive effects 

on small State nonmember institutions. 

Since the prompt corrective action 

directive provisions in part 390, subpart 

Y, are substantively similar to existing 

regulations for state nonmember banks 

found in part 308, subpart Q, the FDIC 

believes it is unlikely that that 

rescission of §§ 390.456 through 390.459 

would have any substantive effects on 

small FDIC-supervised State savings 

associations. 

Based on the information above, the 

FDIC certifies that the final rule will not 

have a significant economic impact on 

a substantial number of small entities. 

C. The Congressional Review Act 

For purposes of Congressional Review 

Act, the OMB makes a determination as 

to whether a final rule constitutes a 

‘‘major rule.’’ 24 If a rule is deemed a 

‘‘major rule’’ by the OMB, the 

Congressional Review Act generally 

provides that the rule may not take 

effect until at least 60 days following its 

publication.25

The Congressional Review Act defines 

a ‘‘major rule’’ as any rule that the 

Administrator of the Office of 

Information and Regulatory Affairs of 

the OMB finds has resulted in or is 

likely to result in—(A) an annual effect 

on the economy of $100,000,000 or 

more; (B) a major increase in costs or 

prices for consumers, individual 

industries, Federal, State, or local 

government agencies or geographic 

regions, or (C) significant adverse effects 

on competition, employment, 

investment, productivity, innovation, or 

on the ability of United States-based 

enterprises to compete with foreignbased enterprises in domestic and 

export markets.26

The OMB has determined that the 

final rule is not a major rule for 

purposes of the Congressional Review 

Act and the FDIC will submit the final 

rule and other appropriate reports to 

Congress and the Government 

Accountability Office for review. 

D. Plain Language 

Section 722 of the Gramm-LeachBliley Act 27 requires the Federal 

banking agencies to use plain language 

in all proposed and final rules 

published after January 1, 2000. The 

FDIC has sought to present the final rule 

in a simple and straightforward manner 

and did not receive any comments on 

the use of plain language. 

E. The Economic Growth and Regulatory 

Paperwork Reduction Act 

Under section 2222 of the Economic 

Growth and Regulatory Paperwork 

Reduction Act of 1996 (EGRPRA), the 

FDIC is required to review all of its 

regulations, at least once every 10 years, 

in order to identify any outdated or 

otherwise unnecessary regulations 

imposed on insured institutions.28 The 

FDIC, along with the other Federal 

banking agencies, submitted a Joint 

Report to Congress on March 21, 2017 

(‘‘EGRPRA Report’’) discussing how the 

review was conducted, what has been 

done to date to address regulatory 

burdens, and further measures the FDIC 

will take to address issues that were 

identified.29 As noted in the EGRPRA 

Report, the FDIC is continuing to 

streamline and clarify its regulations 

through the OTS rule integration 

process. By removing outdated or 

unnecessary regulations, such as part 

390, subpart Y, this rule complements 

other actions that the FDIC has taken, 

separately and with the other Federal 

banking agencies, to further the 

EGRPRA mandate. 

F. Riegle Community Development and 

Regulatory Improvement Act of 1994 

Pursuant to section 302(a) of the 

Riegle Community Development and 

Regulatory Improvement Act 

(RCDRIA),30 in determining the effective 

date and administrative compliance 

requirements for new regulations that 

impose additional reporting, disclosure, 

or other requirements on insured 

depository institutions (IDIs), each 

Federal banking agency must consider, 

consistent with principles of safety and 

soundness and the public interest, any 

administrative burdens that such 

regulations would place on depository 

institutions, including small depository 

institutions, and customers of 

depository institutions, as well as the 

benefits of such regulations. In addition, 

section 302(b) of RCDRIA requires new 

regulations and amendments to 

regulations that impose additional 

reporting, disclosures, or other new 

requirements on IDIs generally to take 

effect on the first day of a calendar 

quarter that begins on or after the date 

on which the regulations are published 

in final form.31 The FDIC has 

determined that the final rule would not 

impose any additional reporting, 

disclosure, or other new requirements 

on IDIs, and thus the requirements of 

the RCDRIA do not apply. 

List of Subjects 

12 CFR Part 308 

Administrative practice and 

procedure, Bank deposit insurance, 

Banks, Banking, Claims, Crime, Equal 

access to justice, Fraud, Investigations, 

Lawyers, Penalties. 

12 CFR Part 390 

Administrative practice and 

procedure, Advertising, Aged, Civil 

rights, Conflict of interests, Credit, 

Crime, Equal employment opportunity, 

Fair housing, Government employees, 

Individuals with disabilities, Reporting 

and recordkeeping requirements, 

Savings associations. 

Authority and Issuance 

For the reasons stated in the 

preamble, the Federal Deposit Insurance 

Corporation amends parts 308 and 390 


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Federal Register / Vol. 86, No. 21 / Wednesday, February 3, 2021 / Rules and Regulations 8109 

of title 12 of the Code of Federal 

Regulations as follows: 

PART 308—RULES OF PRACTICE AND 

PROCEDURE 

■ 1. The authority citation for part 308 

continues to read as follows: 

Authority: 5 U.S.C. 504, 554–557; 12 

U.S.C. 93(b), 164, 505, 1464, 1467(d), 1467a, 

1468, 1815(e), 1817, 1818, 1819, 1820, 1828, 

1829, 1829(b), 1831i, 1831m(g)(4), 1831o, 

1831p–1, 1832(c), 1884(b), 1972, 3102, 

3108(a), 3349, 3909, 4717, 5412(b)(2)(C), 

5414(b)(3); 15 U.S.C. 78(h) and (i), 78o(c)(4), 

78o–4(c), 78o–5, 78q–1, 78s, 78u, 78u–2, 

78u–3, 78w, 6801(b), 6805(b)(1); 28 U.S.C. 

2461 note; 31 U.S.C. 330, 5321; 42 U.S.C. 

4012a; Pub. L. 104–134, sec. 31001(s), 110 

Stat. 1321; Pub. L. 109–351, 120 Stat. 1966; 

Pub. L. 111–203, 124 Stat. 1376; Pub. L. 114– 

74, sec. 701, 129 Stat. 584. 

■ 2. Revise subpart Q to read as follows: 

Subpart Q—Issuance and Review of 

Orders Pursuant to the Prompt 

Corrective Action Provisions of the 

Federal Deposit Insurance Act 

Sec. 

308.200 Scope. 

308.201 Directives to take prompt 

corrective action. 

308.202 Procedures for reclassifying an 

FDIC-supervised institution based on 

criteria other than capital. 

308.203 Order to dismiss a director or 

senior executive officer. 

308.204 Enforcement of directives. 

§ 308.200 Scope. 

The rules and procedures set forth in 

this subpart apply to FDIC-supervised 

institutions and senior executive 

officers and directors of the same that 

are subject to the provisions of section 

38 of the Federal Deposit Insurance Act 

(section 38) (12 U.S.C. 1831o) and 

subpart H of part 324 of this chapter. 

For purposes of this subpart, the term 

‘‘FDIC-supervised institution’’ means 

any insured depository institution for 

which the Federal Deposit Insurance 

Corporation is the appropriate Federal 

banking agency pursuant to section 3(q) 

of the Federal Deposit Insurance Act, 12 

U.S.C. 1813(q). 

§ 308.201 Directives to take prompt 

corrective action. 

(a) Notice of intent to issue directive— 

(1) In general. The FDIC shall provide 

an undercapitalized, significantly 

undercapitalized, or critically 

undercapitalized FDIC-supervised 

institution prior written notice of the 

FDIC’s intention to issue a directive 

requiring such FDIC-supervised 

institution to take actions or to follow 

proscriptions described in section 38 

that are within the FDIC’s discretion to 

require or impose under section 38 of 

the FDI Act, including section 38 (e)(5), 

(f)(2), (f)(3), or (f)(5). The FDICsupervised institution shall have such 

time to respond to a proposed directive 

as provided by the FDIC under 

paragraph (c) of this section. 

(2) Immediate issuance of final 

directive. If the FDIC finds it necessary 

in order to carry out the purposes of 

section 38 of the FDI Act, the FDIC may, 

without providing the notice prescribed 

in paragraph (a)(1) of this section, issue 

a directive requiring an FDIC-supervised 

institution immediately to take actions 

or to follow proscriptions described in 

section 38 that are within the FDIC’s 

discretion to require or impose under 

section 38 of the FDI Act, including 

section 38 (e)(5), (f)(2), (f)(3), or (f)(5). 

An FDIC-supervised institution that is 

subject to such an immediately effective 

directive may submit a written appeal of 

the directive to the FDIC. Such an 

appeal must be received by the FDIC 

within 14 calendar days of the issuance 

of the directive, unless the FDIC permits 

a longer period. The FDIC shall consider 

any such appeal, if filed in a timely 

matter, within 60 days of receiving the 

appeal. During such period of review, 

the directive shall remain in effect 

unless the FDIC, in its sole discretion, 

stays the effectiveness of the directive. 

(b) Contents of notice. A notice of 

intention to issue a directive shall 

include: 

(1) A statement of the FDICsupervised institution’s capital 

measures and capital levels; 

(2) A description of the restrictions, 

prohibitions, or affirmative actions that 

the FDIC proposes to impose or require; 

(3) The proposed date when such 

restrictions or prohibitions would be 

effective or the proposed date for 

completion of such affirmative actions; 

and 

(4) The date by which the FDICsupervised institution subject to the 

directive may file with the FDIC a 

written response to the notice. 

(c) Response to notice—(1) Time for 

response. An FDIC-supervised 

institution may file a written response 

to a notice of intent to issue a directive 

within the time period set by the FDIC. 

The date shall be at least 14 calendar 

days from the date of the notice unless 

the FDIC determines that a shorter 

period is appropriate in light of the 

financial condition of the FDICsupervised institution or other relevant 

circumstances. 

(2) Content of response. The response 

should include: 

(i) An explanation why the action 

proposed by the FDIC is not an 

appropriate exercise of discretion under 

section 38; 

(ii) Any recommended modification 

of the proposed directive; and 

(iii) Any other relevant information, 

mitigating circumstances, 

documentation, or other evidence in 

support of the position of the FDICsupervised institution regarding the 

proposed directive. 

(d) FDIC consideration of response. 

After considering the response, the FDIC 

may: 

(1) Issue the directive as proposed or 

in modified form; 

(2) Determine not to issue the 

directive and so notify the FDICsupervised institution; or 

(3) Seek additional information or 

clarification of the response from the 

FDIC-supervised institution or any other 

relevant source. 

(e) Failure to file response. Failure by 

an FDIC-supervised institution to file 

with the FDIC, within the specified time 

period, a written response to a proposed 

directive shall constitute a waiver of the 

opportunity to respond and shall 

constitute consent to the issuance of the 

directive. 

(f) Request for modification or 

rescission of directive. Any FDICsupervised institution that is subject to 

a directive under this subpart may, 

upon a change in circumstances, request 

in writing that the FDIC reconsider the 

terms of the directive and may propose 

that the directive be rescinded or 

modified. Unless otherwise ordered by 

the FDIC, the directive shall continue in 

place while such request is pending 

before the FDIC. 

§ 308.202 Procedures for reclassifying an 

FDIC-supervised institution based on 

criteria other than capital. 

(a) Reclassification based on unsafe or 

unsound condition or practice—(1) 

Issuance of notice of proposed 

reclassification—(i) Grounds for 

reclassification. (A) Pursuant to 

§ 324.403(d) of this chapter, the FDIC 

may reclassify a well-capitalized FDICsupervised institution as adequately 

capitalized or subject an adequately 

capitalized or undercapitalized 

institution to the supervisory actions 

applicable to the next lower capital 

category if: 

(1) The FDIC determines that the 

FDIC-supervised institution is in unsafe 

or unsound condition; or 

(2) The FDIC, pursuant to section 

8(b)(8) of the FDI Act (12 U.S.C. 

1818(b)(8)), deems the FDIC-supervised 

institution to be engaged in an unsafe or 

unsound practice and not to have 

corrected the deficiency. 

(B) Any action pursuant to this 

paragraph (a)(1)(i) shall be referred to in 

this section as reclassification. 


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(ii) Prior notice to institution. Prior to 

taking action pursuant to § 324.403(d) of 

this chapter, the FDIC shall issue and 

serve on the FDIC-supervised institution 

a written notice of the FDIC’s intention 

to reclassify it. 

(2) Contents of notice. A notice of 

intention to reclassify an FDICsupervised institution based on unsafe 

or unsound condition shall include: 

(i) A statement of the FDIC-supervised 

institution’s capital measures and 

capital levels and the category to which 

the FDIC-supervised institution would 

be reclassified; 

(ii) The reasons for reclassification of 

the FDIC-supervised institution; and 

(iii) The date by which the FDICsupervised institution subject to the 

notice of reclassification may file with 

the FDIC a written appeal of the 

proposed reclassification and a request 

for a hearing, which shall be at least 14 

calendar days from the date of service 

of the notice unless the FDIC determines 

that a shorter period is appropriate in 

light of the financial condition of the 

FDIC-supervised institution or other 

relevant circumstances. 

(3) Response to notice of proposed 

reclassification. An FDIC-supervised 

institution may file a written response 

to a notice of proposed reclassification 

within the time period set by the FDIC. 

The response should include: 

(i) An explanation of why the FDICsupervised institution is not in an 

unsafe or unsound condition or 

otherwise should not be reclassified; 

and 

(ii) Any other relevant information, 

mitigating circumstances, 

documentation, or other evidence in 

support of the position of the FDICsupervised institution regarding the 

reclassification. 

(4) Failure to file response. Failure by 

an FDIC-supervised institution to file, 

within the specified time period, a 

written response with the FDIC to a 

notice of proposed reclassification shall 

constitute a waiver of the opportunity to 

respond and shall constitute consent to 

the reclassification. 

(5) Request for hearing and 

presentation of oral testimony or 

witnesses. The response may include a 

request for an informal hearing before 

the FDIC under this section. If the FDICsupervised institution desires to present 

oral testimony or witnesses at the 

hearing, the FDIC-supervised institution 

shall include a request to do so with the 

request for an informal hearing. A 

request to present oral testimony or 

witnesses shall specify the names of the 

witnesses and the general nature of their 

expected testimony. Failure to request a 

hearing shall constitute a waiver of any 

right to a hearing, and failure to request 

the opportunity to present oral 

testimony or witnesses shall constitute 

a waiver of any right to present oral 

testimony or witnesses. 

(6) Order for informal hearing. Upon 

receipt of a timely written request that 

includes a request for a hearing, the 

FDIC shall issue an order directing an 

informal hearing to commence no later 

than 30 days after receipt of the request, 

unless the FDIC allows further time at 

the request of the FDIC-supervised 

institution. The hearing shall be held in 

Washington, DC, or at such other place 

as may be designated by the FDIC before 

a presiding officer(s) designated by the 

FDIC to conduct the hearing. 

(7) Hearing procedures. (i) The FDICsupervised institution shall have the 

right to introduce relevant written 

materials and to present oral argument 

at the hearing. The FDIC-supervised 

institution may introduce oral testimony 

and present witnesses only if expressly 

authorized by the FDIC or the presiding 

officer(s). Neither the provisions of the 

Administrative Procedure Act (5 U.S.C. 

554–557) governing adjudications 

required by statute to be determined on 

the record nor the Uniform Rules of 

Practice and Procedure in this part 

apply to an informal hearing under this 

section unless the FDIC orders that such 

procedures shall apply. 

(ii) The informal hearing shall be 

recorded, and a transcript shall be 

furnished to the FDIC-supervised 

institution upon request and payment of 

the cost thereof. Witnesses need not be 

sworn, unless specifically requested by 

a party or the presiding officer(s). The 

presiding officer(s) may ask questions of 

any witness. 

(iii) The presiding officer(s) may order 

that the hearing be continued for a 

reasonable period (normally five 

business days) following completion of 

oral testimony or argument to allow 

additional written submissions to the 

hearing record. 

(8) Recommendation of presiding 

officers. Within 20 calendar days 

following the date the hearing and the 

record on the proceeding are closed, the 

presiding officer(s) shall make a 

recommendation to the FDIC on the 

reclassification. 

(9) Time for decision. Not later than 

60 calendar days after the date the 

record is closed or the date of the 

response in a case where no hearing was 

requested, the FDIC will decide whether 

to reclassify the FDIC-supervised 

institution and notify the FDICsupervised institution of the FDIC’s 

decision. 

(b) Request for rescission of 

reclassification. Any FDIC-supervised 

institution that has been reclassified 

under this section, may, upon a change 

in circumstances, request in writing that 

the FDIC reconsider the reclassification 

and may propose that the 

reclassification be rescinded and that 

any directives issued in connection with 

the reclassification be modified, 

rescinded, or removed. Unless 

otherwise ordered by the FDIC, the 

FDIC-supervised institution shall 

remain subject to the reclassification 

and to any directives issued in 

connection with that reclassification 

while such request is pending before the 

FDIC. 

§ 308.203 Order to dismiss a director or 

senior executive officer. 

(a) Service of notice. When the FDIC 

issues and serves a directive on an 

FDIC-supervised institution pursuant to 

§ 308.201 requiring the FDIC-supervised 

institution to dismiss from office any 

director or senior executive officer 

under section 38(f)(2)(F)(ii) of the FDI 

Act, the FDIC shall also serve a copy of 

the directive, or the relevant portions of 

the directive where appropriate, upon 

the person to be dismissed. 

(b) Response to directive—(1) Request 

for reinstatement. A director or senior 

executive officer who has been served 

with a directive under paragraph (a) of 

this section (Respondent) may file a 

written request for reinstatement. The 

request for reinstatement shall be filed 

within 10 calendar days of the receipt 

of the directive by the Respondent, 

unless further time is allowed by the 

FDIC at the request of the Respondent. 

(2) Contents of request; informal 

hearing. The request for reinstatement 

shall include reasons why the 

Respondent should be reinstated and 

may include a request for an informal 

hearing before the FDIC under this 

section. If the Respondent desires to 

present oral testimony or witnesses at 

the hearing, the Respondent shall 

include a request to do so with the 

request for an informal hearing. The 

request to present oral testimony or 

witnesses shall specify the names of the 

witnesses and the general nature of their 

expected testimony. Failure to request a 

hearing shall constitute a waiver of any 

right to a hearing, and failure to request 

the opportunity to present oral 

testimony or witnesses shall constitute 

a waiver of any right or opportunity to 

present oral testimony or witnesses. 

(3) Effective date. Unless otherwise 

ordered by the FDIC, the dismissal shall 

remain in effect while a request for 

reinstatement is pending. 

(c) Order for informal hearing. Upon 

receipt of a timely written request from 

a Respondent for an informal hearing on 


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the portion of a directive requiring an 

FDIC-supervised institution to dismiss 

from office any director or senior 

executive officer, the FDIC shall issue 

an order directing an informal hearing 

to commence no later than 30 days after 

receipt of the request, unless the 

Respondent requests a later date. The 

hearing shall be held in Washington, 

DC, or at such other place as may be 

designated by the FDIC, before a 

presiding officer(s) designated by the 

FDIC to conduct the hearing. 

(d) Hearing procedures. (1) A 

Respondent may appear at the hearing 

personally or through counsel. A 

Respondent shall have the right to 

introduce relevant written materials and 

to present oral argument. A Respondent 

may introduce oral testimony and 

present witnesses only if expressly 

authorized by the FDIC or the presiding 

officer(s). Neither the provisions of the 

Administrative Procedure Act governing 

adjudications required by statute to be 

determined on the record nor the 

Uniform Rules of Practice and 

Procedure in this part apply to an 

informal hearing under this section 

unless the FDIC orders that such 

procedures shall apply. 

(2) The informal hearing shall be 

recorded, and a transcript shall be 

furnished to the Respondent upon 

request and payment of the cost thereof. 

Witnesses need not be sworn, unless 

specifically requested by a party or the 

presiding officer(s). The presiding 

officer(s) may ask questions of any 

witness. 

(3) The presiding officer(s) may order 

that the hearing be continued for a 

reasonable period (normally five 

business days) following completion of 

oral testimony or argument to allow 

additional written submissions to the 

hearing record. 

(e) Standard for review. A Respondent 

shall bear the burden of demonstrating 

that his or her continued employment 

by or service with the FDIC-supervised 

institution would materially strengthen 

the FDIC-supervised institution’s 

ability: 

(1) To become adequately capitalized, 

to the extent that the directive was 

issued as a result of the FDIC-supervised 

institution’s capital level or failure to 

submit or implement a capital 

restoration plan; and 

(2) To correct the unsafe or unsound 

condition or unsafe or unsound 

practice, to the extent that the directive 

was issued as a result of classification 

of the FDIC-supervised institution based 

on supervisory criteria other than 

capital, pursuant to section 38(g) of the 

FDI Act. 

(f) Recommendation of presiding 

officers. Within 20 calendar days 

following the date the hearing and the 

record on the proceeding are closed, the 

presiding officer(s) shall make a 

recommendation to the FDIC concerning 

the Respondent’s request for 

reinstatement with the FDIC-supervised 

institution. 

(g) Time for decision. Not later than 

60 calendar days after the date the 

record is closed or the date of the 

response in a case where no hearing was 

requested, the FDIC shall grant or deny 

the request for reinstatement and notify 

the Respondent of the FDIC’s decision. 

If the FDIC denies the request for 

reinstatement, the FDIC shall set forth in 

the notification the reasons for the 

FDIC’s action. 

§ 308.204 Enforcement of directives. 

(a) Judicial remedies. Whenever an 

FDIC-supervised institution fails to 

comply with a directive issued under 

section 38, the FDIC may seek 

enforcement of the directive in the 

appropriate United States district court 

pursuant to section 8(i)(1) of the FDI Act 

(12 U.S.C. 1818(i)(1)). 

(b) Administrative remedies—(1) 

Failure to comply with directive. 

Pursuant to section 8(i)(2)(A) of the FDI 

Act, the FDIC may assess a civil money 

penalty against any FDIC-supervised 

institution that violates or otherwise 

fails to comply with any final directive 

issued under section 38 and against any 

institution-affiliated party who 

participates in such violation or 

noncompliance. 

(2) Failure to implement capital 

restoration plan. The failure of an FDICsupervised institution to implement a 

capital restoration plan required under 

section 38, or subpart H of part 324 of 

this chapter, or the failure of a company 

having control of an FDIC-supervised 

institution to fulfill a guarantee of a 

capital restoration plan made pursuant 

to section 38(e)(2) of the FDI Act shall 

subject the FDIC-supervised institution 

to the assessment of civil money 

penalties pursuant to section 8(i)(2)(A) 

of the FDI Act. 

(c) Other enforcement action. In 

addition to the actions described in 

paragraphs (a) and (b) of this section, 

the FDIC may seek enforcement of the 

provisions of section 38 or subpart H of 

part 324 of this chapter through any 

other judicial or administrative 

proceeding authorized by law. 

PART 390—REGULATIONS 

TRANSFERRED FROM THE OFFICE OF 

THRIFT SUPERVISION 

■ 3. The authority citation for part 390 

continues to read as follows: 

Authority: 12 U.S.C. 1819. 

Subpart Q also issued under 12 U.S.C. 

1462; 1462a; 1463; 1464. 

Subpart W also issued under 12 U.S.C. 

1462a; 1463; 1464; 15 U.S.C. 78c; 78l; 78m; 

78n; 78p; 78w. 

Subpart Y—[Removed and Reserved] 

■ 4. Remove and reserve subpart Y, 

consisting of §§ 390.450 through 

390.459. 

Federal Deposit Insurance Corporation. 

By order of the Board of Directors. 

Dated at Washington, DC, on December 15, 

2020. 

James P. Sheesley, 

Assistant Executive Secretary. 

[FR Doc. 2020–28455 Filed 2–2–21; 8:45 am] 

BILLING CODE 6714–01–P 


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