This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents.

Rules and Regulations Federal Register

79125 

Vol. 89, No. 188 

Friday, September 27, 2024 

1 87 FR 18740 (March 31, 2022). 

2 89 FR 29222 (April 19, 2024). 

3Request for Comment on Proposed Statement of 

Policy on Bank Merger Transactions. See 89 FR 

29222. 

NUCLEAR REGULATORY 

COMMISSION 

10 CFR Part 72 

RIN 3150–AL18 

List of Approved Spent Fuel Storage 

Casks: Holtec International HISTORM 

100 Cask System, Certificate of 

Compliance No. 1014, Renewed 

Amendment No. 18 

Correction 

In rule document 2024–19801 

appearing on pages 72304 through 

723095, in the issue of Thursday, 

September 5, 2024, make the following 

correction: 

On page 72305, in the first column, on 

the 41st line, change ‘‘September 26, 

2024,’’ to ‘‘October 7, 2024,’’ 

[FR Doc. C1–2024–19801 Filed 9–26–24; 8:45 am] 

BILLING CODE 0099–10–D 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR 303 

RIN 3064–ZA31 

Final Statement of Policy on Bank 

Merger Transactions 

AGENCY: Federal Deposit Insurance 

Corporation (FDIC). 

ACTION: Final statement of policy. 

SUMMARY: The FDIC is issuing this final 

Statement of Policy on Bank Merger 

Transactions (Final Statement) to 

provide transparency on how the FDIC 

administers its responsibilities under 

the Bank Merger Act (BMA). The Final 

Statement takes into consideration 

comments received in response to the 

FDIC’s request for comment on a 

proposed Statement of Policy on Bank 

Merger Transactions (Proposed 

Statement), and this Final Statement 

reflects certain changes made in 

response to comments received. The 

Final Statement focuses on the scope of 

transactions subject to FDIC approval, 

the FDIC’s process for evaluating merger 

applications, and the principles that 

guide the FDIC’s consideration of the 

applicable statutory factors as set forth 

in the BMA. 

DATES: The Final Statement supersedes 

the prior FDIC Statement of Policy on 

Bank Merger Transactions on October 

28, 2024. 

FOR FURTHER INFORMATION CONTACT: 

George Small, Senior Examination 

Specialist, (347) 267–2453, gsmall@

fdic.gov, Division of Risk Management 

Supervision; Annmarie Boyd, Senior 

Counsel, (202) 898–3714, aboyd@

fdic.gov, Benjamin Klein, Supervisory 

Counsel, (202) 898–7027, bklein@

fdic.gov, Legal Division; Jessica 

Thurman, Chief, (202) 898–3579, 

jthurman@fdic.gov, Division of 

Depositor and Consumer Protection; 

Mark Haley, Chief, (917) 320–2911, 

mahaley@fdic.gov, Division of Complex 

Institution Supervision and Regulation; 

and Ryan Singer, Chief, (202) 898–7532, 

rsinger@fdic.gov, Division of Insurance 

and Research. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Final Statement supersedes the 

prior FDIC Statement of Policy on Bank 

Merger Transactions (Superseded 

Statement), which was last amended in 

2008. Since the Superseded Statement 

was last revised, the BMA has been 

amended and significant changes have 

occurred in the banking industry and 

financial system, which has prompted 

the FDIC to develop this Final 

Statement. Following the FDIC’s 2022 

request for information and comment 1

on rules, regulations, guidance, and 

statements of policy regarding bank 

merger transactions, the FDIC published 

a request for comment on its Proposed 

Statement in the Federal Register on 

April 19, 2024.2

The FDIC received 23 letters from the 

public in response to the Proposed 

Statement, including representatives of 

the financial services industry, trade 

associations, consumer groups, 

university professors, and members of 

Congress.3 After reviewing the public 

comments received in response to the 

Proposed Statement, the FDIC has made 

revisions to address certain of the 

comments and is adopting this Final 

Statement. A summary and discussion 

of the comments and changes 

incorporated in the Final Statement are 

described in section III of this 

Supplementary Information. 

II. Overview of the Final Statement 

The Final Statement updates, 

strengthens, and clarifies the FDIC’s 

policies related to the evaluation of 

bank merger applications. As compared 

to the Superseded Statement, the Final 

Statement includes new content; is 

more principles-based; addresses 

jurisdiction and scope; describes the 

FDIC’s approach to each statutory factor 

separately; and highlights other matters 

and considerations such as interstate 

mergers and the unique aspects of 

applications from non-banks, operating 

non-insured entities, and banks that are 

not traditional community banks. The 

Final Statement highlights the FDIC’s 

expectations relative to each statutory 

factor and incorporates analytical 

considerations for these areas. 

Introduction 

The introduction to the Final 

Statement retains the Proposed 

Statement’s content by providing a 

roadmap of the Final Statement’s 

structure, which follows the BMA’s core 

statutory provisions, and highlights the 

principles that guide the FDIC’s 

evaluation of the statutory factors for a 

merger application. 

Jurisdiction and Scope 

The Final Statement generally retains 

with minor modifications the Proposed 

Statement’s discussion regarding the 

FDIC’s jurisdiction under the BMA and 

the scope of transactions subject to 

regulatory approval. Specifically, the 

Final Statement provides transparency 

and clarity on the types of transactions 

that are subject to the BMA, including 

mergers in substance and assumptions 

of deposits or other similar liabilities. 

This section highlights the overarching 

principle that the FDIC emphasizes a 

transaction’s substance over its form 

when determining whether it 

constitutes a merger transaction subject 

to FDIC approval under the BMA. 

Process and Adjudication 

The Final Statement retains the 

Proposed Statement’s discussion of the 

FDIC’s processing and adjudication of 


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79126 Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Rules and Regulations 

4Applications Procedures Manual, Applications 

Overview, 1.1, https://www.fdic.gov/system/files/ 

2024-07/section-01-01-overview.pdf, APM, 

Standard and Nonstandard Conditions, 1.11, 

https://www.fdic.gov/system/files/2024-07/section01-11-newconditions.pdf; and Deposit Insurance 

Applications Procedures Manual Supplement— 

Applications from Non-Bank and Non-Community 

Bank Applicants, https://www.fdic.gov/sites/ 

default/files/2024-03/procmanual-supplement.pdf. 

5FDIC Board Resolution Seal No. 088980 (June 

20, 2024). This resolution also applies to 

outstanding deposit insurance applications. 

6E.O. 14036 ‘‘Promoting Competition in the 

American Economy’’ (July 9, 2021). 

merger applications. With respect to 

processing, the Final Statement 

emphasizes the importance of pre-filing 

meetings, substantially complete 

applications, and public feedback. With 

respect to adjudication, the Final 

Statement retains the FDIC’s 

longstanding tenet of the FDIC’s 

applications processing policy and 

procedures 4 to not use conditions as a 

means to favorably resolve statutory 

factors, but adopts slightly modified 

language to more clearly articulate this 

point. The Final Statement indicates 

imposition of conditions will be taken 

into account as part of the FDIC’s 

consideration of the merger application, 

but will not necessarily lead to the 

favorable resolution of any statutory 

factor where the facts and circumstances 

are otherwise unfavorable. As with the 

Proposed Statement, this section of the 

Final Statement emphasizes that the 

FDIC Board of Directors (FDIC Board) 

reserves the authority to deny any 

merger transaction or to act on any 

merger transaction for which one or 

more statutory factors are not favorably 

resolved. In addition, the FDIC Board 

notably reserves authority to act on any 

application for which the Attorney 

General has not notified the FDIC in 

writing that the proposed transaction 

would not have a significantly adverse 

effect on competition. 

The Final Statement retains the 

Proposed Statement’s non-exhaustive 

list of circumstances that could lead to 

an unfavorable finding on one or more 

statutory factors. Further, it asserts the 

FDIC Board’s prerogative to release a 

statement regarding withdrawn 

transactions if such a statement is 

considered to be in the public interest 

for creating transparency for the public 

and future applicants. The FDIC 

emphasizes that such statements are not 

to be expected in every instance, but 

only when warranted by the 

circumstances, and would be in 

conformance with the FDIC’s obligation 

to protect confidential information. 

Statutory Factors 

Consistent with the Proposed 

Statement, the Final Statement is 

organized around a discussion of the 

BMA’s statutory factors. The BMA 

prohibits approval of monopolistic 

merger transactions, restricts otherwise 

anticompetitive transactions, and 

requires consideration of statutory 

factors related to financial and 

managerial resources and future 

prospects, convenience and needs of the 

community to be served, combatting 

money laundering, and financial 

stability. 

As emphasized in the Final Statement 

and throughout this Supplementary 

Information, the FDIC Board reserves 

authority to act on any merger 

application for which FDIC staff has not 

found favorably on one or more 

statutory factors. Such action may be 

either an approval or a denial. The Final 

Statement describes the FDIC’s 

approach to evaluating each statutory 

factor. The Final Statement is intended 

to provide greater clarity regarding what 

features of merger transactions may be 

consistent with a favorable finding on 

each respective statutory factor. When a 

merger transaction includes these 

features, and the facts and 

circumstances of such transaction 

clearly weigh in favor of favorable 

resolution of the statutory factors, the 

FDIC expects such applications to be 

approved expeditiously under delegated 

authority. When the facts and 

circumstances do not so clearly weigh 

in favor of favorable resolution of the 

statutory factors, it is appropriate that 

the judgment of the FDIC Board be 

brought to bear on the application. In 

addition, it is important to note that on 

June 18, 2024, the FDIC Board adopted 

a resolution requiring full FDIC Board 

briefings on merger, and certain other, 

applications that have been outstanding 

for more than 270 days since the 

application’s filing (Board Briefings 

Resolution).5 The Board Briefings 

Resolution ensures that the FDIC Board 

has the opportunity to be informed of, 

and provide direction on, merger, and 

certain other, applications for which 

obstacles to favorable resolution of the 

statutory factors may be materializing. 

Certain aspects of the Final Statement, 

such as the expectation that mergers 

resulting in IDIs with $50 billion or 

more in total assets should be the 

subject of public meetings and the 

expectation that mergers resulting in 

IDIs with $100 billion or more in total 

assets be the subject of a heightened 

financial stability analysis are intended 

to position the FDIC to conduct an 

informed evaluation of the statutory 

factors for highly consequential merger 

proposals. 

Monopolistic or Anticompetitive Effects 

The Final Statement retains and 

builds upon the Proposed Statement’s 

discussion of how the FDIC evaluates 

the competitive effects of a merger 

transaction. The Final Statement 

describes the FDIC’s approach to 

considering concentrations in relevant 

geographic and product markets, which 

begins with measuring concentrations 

based on local deposit shares, but as 

necessary will take into account any 

appropriate data sources and analytical 

approaches relevant to fully assessing 

the competitive effects of the 

transaction. 

The Final Statement builds upon the 

Proposed Statement by highlighting 

practices that may be particularly 

relevant to rural institutions. 

Specifically, the Final Statement 

acknowledges that, as circumstances 

warrant, the FDIC will take into account 

certain non-bank competitors, expressly 

identifying credit unions, thrifts, and 

Farm Credit System institutions. While 

the FDIC will consider such competitors 

when relevant, the FDIC expects that the 

presence of such competitors may be 

especially salient for mergers involving 

rural markets. In addition, the Final 

Statement recognizes that mergers in 

rural areas involving local community 

banks may result in concentrated 

markets and emphasizes that the FDIC 

will carefully balance the competitive 

effects of such a merger with the public 

interest served by the capacity of the 

resulting IDI to meet the convenience 

and needs of the community. Finally, a 

footnote was added to clarify that 

competitors in the market include, but 

are not limited to, credit unions, thrifts, 

and Farm Credit System institutions. 

The FDIC continues to recognize the 

July 9, 2021, Executive order (E.O.) 

addressing competition in the American 

economy.6 The FDIC continues to 

coordinate with the Department of 

Justice (DOJ) and the other Federal 

banking agencies in modernizing bank 

merger oversight, and the Final 

Statement emphasizes that the 

analytical methods the FDIC employs in 

conducting its independent analysis 

will continue to be informed by the 

DOJ’s approach to evaluating 

competitive effects. As previously 

stated, the FDIC Board reserves 

authority to act on any application in 

which the merging institutions operate 

in the same relevant geographic 

markets(s) and for which the Attorney 

General has not notified the FDIC that 

the proposed transaction would not 

have a significantly adverse effect on 


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Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Rules and Regulations 79127 

7The Final Statement emphasizes the importance 

of a merger enabling a resulting IDI to better meet 

the convenience and needs of the community in the 

context of mergers involving two IDIs. The FDIC has 

jurisdiction to act on any merger transaction 

involving an IDI and a noninsured institution. For 

transactions that have a negligible impact on 

consumers, such as where an IDI merges with a 

non-customer facing subsidiary, the FDIC will 

consider the IDI’s record in meeting the 

convenience and needs of the community to be 

served as the primary means for resolving this 

factor. 

competition, or for which the Attorney 

General has notified the FDIC that the 

application would have a significantly 

adverse effect on competition. In such 

cases, applicants would need to 

demonstrate that the anticompetitive 

effects of the merger transaction would 

be outweighed in the public interest by 

the probable effect of the transaction in 

meeting the convenience and needs of 

the community to be served. 

The Final Statement discusses 

divestitures as a means to mitigate 

competitive concerns before allowing 

the merger to be consummated. To 

promote the effectiveness of the 

divestiture(s) in mitigating 

anticompetitive concerns, the FDIC 

generally expects that the selling IDI 

will neither enter into non-compete 

agreements with any employee of the 

divested entity nor enforce any existing 

non-compete agreements with any of 

those entities. In addition, the Final 

Statement communicates the FDIC’s 

expectation that in situations where an 

IDI is divesting or otherwise closing a 

branch in connection with the 

transaction, the FDIC also expects the 

IDI to waive any terms or conditions 

(e.g., exclusive use clauses) that 

preclude the ability of other IDIs to lease 

or purchase the property. 

Financial Resources 

The Final Statement generally retains 

the Proposed Statement’s emphasis on 

the resulting IDI reflecting sound 

financial performance and condition 

and meeting applicable capital 

standards. However, the Final Statement 

does not incorporate the Proposed 

Statement’s assertion that the FDIC will 

not find favorably on the financial 

resources factor if the merger would 

result in a weaker IDI from a financial 

perspective. This statement was 

removed to avoid the suggestion that an 

IDI that reflects a very strong financial 

condition would be precluded from 

absorbing a weaker target. It was 

replaced with language affirming that a 

favorable finding on the financial 

resources factor would only be 

appropriate in cases where the merger 

results in a combined IDI that presents 

less financial risk than the financial risk 

posed by the institutions on a 

standalone basis. The revised comment 

affirms that the FDIC’s analysis balances 

the impact of the proposed merger on 

financial resources particularly when 

the resulting IDI may initially be weaker 

immediately following consummation. 

This language is consistent with the 

FDIC’s historical approach to the 

analysis of this factor. While a resultant 

IDI may be weaker post-acquisition, the 

FDIC broadly considers the long-term 

financial impacts over the near-term 

implications of a merger. For example, 

when a proposed merger transaction 

involves an IDI in less than satisfactory 

condition (or experiencing potentially 

significant financial or managerial 

concerns), emphasis is placed on the 

capacity of the acquiring IDI to absorb 

the weaker IDI and address the 

problems or concerns identified. 

Furthermore, purchase accounting rules 

generally require an acquiring IDI to 

recognize the target’s assets and 

liabilities at fair value, which often 

causes the resulting IDI to look weaker 

financially on day one, post-merger. 

Managerial Resources 

The Final Statement retains without 

change the Proposed Statement’s 

discussion of the managerial resources 

factor. This discussion reflects and 

elaborates on the FDIC’s expectation 

that the management of the resulting IDI 

possess the capabilities to administer 

the resulting IDI’s affairs in a safe and 

sound manner, and to effectively 

implement post-merger integration 

plans and strategies. 

Future Prospects 

The Final Statement retains without 

change the Proposed Statement’s 

discussion of the future prospects 

statutory factor. The discussion reflects 

and elaborates upon the FDIC’s 

expectation that the resulting IDI will 

operate in a safe and sound manner on 

a sustained basis following 

consummation of the merger. 

Convenience and Needs of the 

Community To Be Served 

The Final Statement retains with 

slight modifications the Proposed 

Statement’s discussion of the statutory 

factor related to the convenience and 

needs of the community to be served. 

Notably, the Final Statement 

communicates and elaborates upon the 

FDIC’s expectation that a merger 

between IDIs 7 will enable the resulting 

IDI to better meet the convenience and 

needs of the community to be served 

than would occur absent the merger in 

order for FDIC staff to find favorably on 

this factor. As noted above, the FDIC 

Board retains authority to evaluate any 

merger transaction for which one or 

more of the statutory factors are not 

favorably resolved. Further, the FDIC 

Board expects a favorable resolution of 

the convenience and needs factor to be 

clearly supported by a demonstration of 

how the merger transaction would 

position the resulting IDI to better meet 

the needs of the communities it serves. 

A favorable finding on the convenience 

and needs of the community to be 

served factor may not be sufficient to 

support approval of the application 

when anticompetitive effects are 

identified. In situations where 

anticompetitive effects are identified, 

the FDIC will evaluate whether the 

applicant has demonstrated that the 

benefits to the convenience and needs of 

the community will clearly outweigh 

the anticompetitive effects. 

Absent such a demonstration, the 

FDIC Board reserves the authority to 

evaluate and act upon the merger by 

taking into account all of the facts and 

circumstances of the transaction in the 

context of the statutory factors. 

In addition, the Final Statement 

communicates the FDIC’s expectation to 

hold public hearings for mergers 

resulting in IDIs that have $50 billion or 

more in total consolidated assets. Public 

input is an essential part of the FDIC’s 

consideration of every merger 

transaction. The primary means of 

receiving public input is through the 

statutorily mandated public comment 

process, but the Final Statement reflects 

the FDIC’s policy that an additional 

forum for public input for the most 

consequential merger transactions 

would be appropriate. 

Risk to the Stability of the United States 

Banking or Financial System 

The Final Statement retains without 

change the Proposed Statement’s 

discussion of the financial stability 

factor. The discussion explains that the 

FDIC evaluates the financial stability 

factor with respect to the size of the 

entities involved in the transaction, the 

availability of substitute providers for 

any critical products or services to be 

offered by the resulting IDI, the resulting 

IDI’s degree of interconnectedness with 

the U.S. banking or financial system, the 

extent to which the resulting IDI 

contributes to the U.S. banking or 

financial system’s complexity, and the 

extent of the resulting IDI’s cross-border 

activities. 

The Final Statement emphasizes that 

size alone is not dispositive for 

determining the risk to the U.S. banking 

or financial system’s stability, but 

nonetheless recognizes that transactions 

that result in a large IDI are more likely 


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79128 Federal Register / Vol. 89, No. 188 / Friday, September 27, 2024 / Rules and Regulations 

8 12 CFR 265.20(c)(12)(vii). 

9This is generally consistent with interpretations 

of the OCC regarding section 18(c)(2) of the Bank 

Merger Act. See Office of the Comptroller of the 

Currency, Comptroller’s Licensing Manual: 

Business Combinations (‘‘The OCC interprets 

‘acquire the assets’ for BMA filing purposes to 

include the acquisition of assets such that the target 

is no longer a viable competitor, regardless of 

whether the target plans to liquidate immediately 

after consummating the transaction.’’). 

10For example, the BMA would apply to a 

transaction in which an IDI merges with a noncustomer-facing operating subsidiary. Even in cases 

where the IDI is over $50 billion in assets, it may 

not be necessary for the evaluation of the 

convenience and needs factor to hold public 

hearings given the nature of the transaction. 

to present potential stability concerns. 

The Final Statement communicates the 

FDIC’s expectation that additional 

scrutiny will be applied to the 

evaluation of such mergers. For the 

purposes of clarifying expectations, the 

Final Statement reflects that this 

additional scrutiny will apply to 

transactions resulting in IDIs with $100 

billion or more in total consolidated 

assets. The FDIC further emphasizes 

that such bank merger applications are 

typically accompanied by companion 

applications at the holding company 

level, which are subject to approval by 

the Board of Governors of the Federal 

Reserve System (Federal Reserve Board). 

The expectation related to a resulting 

IDI with total assets over $100 billion as 

identified in the Final Statement aligns 

with the Federal Reserve Board’s 

delegations of authority.8

Effectiveness in Combatting Money 

Laundering Activities 

The Final Statement retains without 

change the Proposed Statement’s 

discussion regarding the statutory factor 

related to the effectiveness in 

combatting money laundering. The 

Final Statement communicates and 

elaborates upon the FDIC’s expectation 

that approved merger transactions will 

result in IDIs with effective programs to 

combat money laundering and counter 

the financing of terrorism. 

Other Matters and Consideration 

The Final Statement retains the 

Proposed Statement’s discussion of 

other matters and considerations, which 

alerts the public to the added 

requirements that apply to interstate 

transactions, as well as the FDIC’s 

approach to applications involving nonbanks or banks that are not traditional 

community banks, and applications 

involving operating non-insured 

entities. 

III. Summary and Discussion of 

Comments 

Many commenters recommended 

some type of revision or alteration with 

respect to the discussion of how the 

FDIC analyzes the statutory factors, with 

particular emphasis on competitive 

effects, convenience and needs of the 

community, and risk to the stability of 

the U.S. banking or financial system. 

Additionally, many commenters 

provided feedback or recommendations 

for process changes that are outside the 

scope of what was initially proposed. 

For example, multiple commenters 

discussed a need to increase the 

scrutiny applied to acquisitions of banks 

by nonbanks such as credit unions. 

Other items suggested include: 

• adopting a separate review 

framework for mergers involving 

community banks and nonbank 

acquirers; 

• ending expedited reviews/ 

processing of bank merger applications; 

• adopting metrics and benchmarks 

for a streamlined application and an 

expedited review for transactions 

between small IDIs that do not raise 

significant supervisory or financial 

stability concerns and where no adverse 

public comments have been filed; 

• disallowing banks with over 10 

percent of U.S. deposits from buying 

failing banks unless there are no other 

buyers; 

• developing an interagency 

statement of policy; and 

• consulting the Consumer Financial 

Protection Bureau on all merger 

applications. 

Some commenters that were largely 

supportive of aspects of the Proposed 

Statement recommended further 

refinements or additional elements for 

consideration. For example, one such 

commenter suggested that a merger 

must enhance the resulting IDI’s ability 

to serve the public for it to warrant 

approval. However, the same 

commenter also suggested including a 

statement that the FDIC would add a 

condition to approval orders restricting 

the ability of IDIs to close branches 

beyond those identified for closing in 

the application. Some commenters were 

broadly opposed to certain aspects of 

the Proposed Statement. These 

commenters argued that the FDIC’s 

current framework for reviewing 

proposed merger transactions was 

sound and warned of negative 

consequences from the proposed 

revisions. 

Jurisdiction and Scope 

Some commenters suggested that the 

Proposed Statement’s jurisdiction and 

scope section exceeds the FDIC’s 

statutory authority, contending that 

statements regarding the FDIC’s 

jurisdiction are overly broad as they 

suggest that applications are necessary 

for various types of transactions that are 

not true mergers. The BMA expressly 

subjects a wide range of transactions to 

regulatory approval, and the Final 

Statement generally retains the 

Proposed Statement’s approach to 

jurisdiction and scope, which reflects 

statutory requirements and the FDIC’s 

longstanding practice. With respect to 

asset acquisitions that do not involve 

deposits or similar liabilities, the Final 

Statement maintains that the FDIC 

considers transactions to be mergers in 

substance when a target would no 

longer compete in the market, regardless 

of whether the target plans to liquidate 

immediately after consummating the 

transaction. Similar to the Proposed 

Statement, the Final Statement offers as 

an example of a substantive merger a 

transaction in which ‘‘an IDI absorbs all 

(or substantially all) of a target entity’s 

assets and the target entity dissolves (or 

otherwise ceases to engage in the 

acquired lines of business such that the 

target is no longer a viable 

competitor).’’ 9 The Final Statement 

adopts the language related to the target 

no longer being a viable competitor in 

order to reflect the BMA’s emphasis on 

competitive considerations. 

In response to the Proposed 

Statement, it was suggested that the 

FDIC should assert that asset 

acquisitions that would not qualify as 

de facto mergers under State common 

law would not be subject to a filing 

requirement under the BMA. The Final 

Statement makes no such reference to 

State common law, as the scope of 

transactions subject to the BMA for the 

purposes embodied by its statutory 

factors is not perfectly coextensive with 

the scope of transactions that qualify as 

de facto mergers under divergent State 

law doctrines for the purpose of 

establishing successor liability. In 

addition, the Final Statement retains the 

Proposed Statement’s explanation that 

an IDI’s assumption of any deposit or 

other similar liabilities is subject to the 

BMA, and the FDIC emphasizes that any 

transaction that consists of an 

assumption of deposits or other similar 

liabilities is subject to the BMA 

regardless of whether the transaction as 

a whole represents a substantive merger. 

Although the scope of transactions 

subject to the BMA is broad and there 

is no de minimis exception to the BMA, 

the Final Statement acknowledges that 

the FDIC will evaluate the applicable 

statutory factors in a manner that is 

appropriate to each transaction.10


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11FDIC Applications Procedures Manual, section 

1.11, Standard and Nonstandard Conditions. 

12The HHI is calculated by squaring the market 

share of each firm competing in the market and 

then summing the resulting numbers. For example, 

for a market consisting of four firms with shares of 

30, 30, 20, and 20 percent, the HHI is 2,600 (302

+ 302 + 202 + 202 = 2,600). The HHI calculation can 

also be applied to other relevant Consolidated 

Reports of Condition categories or other appropriate 

sources of data, aside from deposits. For example, 

the HHI analysis may also include data relative to 

commercial and industrial loans. 

Process and Adjudication 

Multiple commenters requested the 

adoption of specific approval metrics 

and benchmarks and the removal of 

general terms. One commenter 

requested that the Final Statement 

include benchmarks for a streamlined 

application and expedited review for 

transactions between small IDIs that do 

not raise significant supervisory 

concerns and where no adverse public 

comments have been filed. Several 

commenters requested a de minimis 

exception for a merger in which the 

resulting IDI would have less than $10 

billion in total assets. Some commenters 

requested that the FDIC terminate 

expedited processing of applications. 

However, other commenters stated an 

opposing view. 

No specific bright lines or 

performance thresholds were included 

in the Final Statement to retain 

flexibility to evaluate the facts and 

circumstances of each individual 

application, and no de minimis 

thresholds were adopted. Section 303.64 

of the FDIC Rules and Regulations 

codifies the requirements for expedited 

processing of merger applications. The 

regulation has not been changed. 

Applications that qualify will receive 

expedited processing when appropriate, 

unless the applicant is notified in 

writing to the contrary and provided 

with the basis for that decision. The 

FDIC may remove an application from 

expedited processing for any of the 

reasons set forth in § 303.11(c)(2) of the 

FDIC Rules and Regulations. It is 

important to note that if the FDIC does 

not act within the expedited processing 

period, it does not constitute an 

automatic or default approval. 

Multiple commenters noted that the 

Final Statement should expressly 

authorize conditions to be used to find 

favorably on a statutory factor. The 

Final Statement does not state that 

conditions can be used to find favorably 

on a statutory factor that otherwise 

presents material concerns. However, 

the FDIC may impose targeted 

conditions to mitigate specific risks. 

Conditions are not a substitute for the 

resolution of, and do not in and of 

themselves favorably resolve, an 

applicable statutory factor. As noted in 

the Final Statement, the imposition of 

conditions will be taken into account as 

part of the FDIC’s consideration of the 

merger application, but will not 

necessarily lead to the favorable 

resolution of any statutory factor where 

the facts and circumstances are 

otherwise unfavorable. This is 

consistent with the FDIC’s long-standing 

applications processing policy.11

Commenters suggested that the 

process for the FDIC Board to post a 

statement about a withdrawn 

application be eliminated. Further, 

commenters indicated that the FDIC 

should confirm that detailed nonpublic 

information provided in merger 

applications would remain confidential. 

The Final Statement retains the FDIC 

Board’s discretion to release a statement 

regarding the concerns with a 

withdrawn application if such a 

statement is considered to be in the 

public interest for purposes of creating 

transparency for the public and future 

applicants. Publishing such a statement 

provides the industry with insights and 

understanding of what features of a 

proposal may be inconsistent with 

approval. If such a statement is not 

published, the industry and consumers 

would not understand the rationale for 

the withdrawal and the issues/concerns 

identified during the review process. 

The publication of such a statement is 

not expected for most transactions and 

the FDIC intends that any such 

statement would be fully consistent 

with the confidentiality requirements of 

applicable laws and regulations and 

would not disclose confidential 

business information of applicants. 

Statutory Factors 

Monopolistic or Anticompetitive Effects 

Commenters stated that preconsummation divestitures would add 

significant delay and complexity to an 

already lengthy and costly merger 

process. The Final Statement retains the 

language as presented. Any potential 

divestitures would follow regulatory 

approval. Divestitures, when required, 

may be included as a condition that 

must be addressed prior to 

consummation of the merger. Such 

actions would not delay the merger 

application submission, review, and 

approval processes; as such, the length 

of time for regulatory review and 

adjudication is not expected to change. 

Multiple commenters suggested 

revisions to the competitive effects 

analysis. Several commenters raised 

concerns with credit union acquisitions 

of IDIs and requested a special analysis 

of the competitive impacts of such 

transactions. It was also suggested that 

credit union competition should be 

given a multiplier when used as part of 

the competitive analysis. No changes 

were made to the Final Statement to 

address the competitive effects analysis 

of credit union acquisitions of IDIs; as 

such, transactions are subject to the 

same statutory factors. When assessing 

the competitive effects, the FDIC 

considers all relevant market 

participants; however, no multiplier is 

used to increase the credit union impact 

on the Herfindahl–Hirschman Index 

(HHI),12 which could inaccurately 

reflect the influence of credit unions in 

the relevant geographic market. This is 

consistent with historical practice and 

remains unchanged in the Final 

Statement. 

Other commenters noted that the 

Final Statement should include specific 

metrics for transactions to be considered 

anti-competitive, including specific HHI 

thresholds that would be consistent 

with approval. Other commenters 

requested to preserve the current 

thresholds since it provides a level of 

certainty by which mergers are 

presumed not to raise competitive 

concerns. Commenters also suggested 

that the Final Statement should use a 

higher HHI threshold in rural markets 

and that use of the Federal Reserve 

Board’s banking markets should be 

revisited. The Final Statement does not 

include specific HHI metrics or 

benchmarks at this time. With respect to 

the Federal Reserve Board’s banking 

markets, the FDIC will employ a 

geographic market definition that is 

appropriate to the facts and 

circumstances of the application. The 

evaluative considerations for 

competitive effects analysis are 

described in the Final Statement, and 

HHI calculations are described in the 

Applications Procedures Manual, 

section 4, Mergers. Section 4 is 

currently being revised to reflect the 

Final Statement. 

With respect to the evaluation of 

competition in rural markets, the Final 

Statement emphasizes the FDIC’s 

statutory obligation to weigh any 

potential anticompetitive effects of a 

merger against the convenience and 

needs of the community to be served, 

and that it is possible for consideration 

of convenience and needs to outweigh 

a concern with potential 

anticompetitive effects. The FDIC 

recognizes that in rural communities, 

typical concentration measures such as 

HHI based purely on IDI deposit 

concentrations might be incomplete, 


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particularly to the extent that residents 

receive banking services from credit 

unions, Farm Credit System institutions, 

or other nonbanks or banks that are not 

traditional community banks. While the 

FDIC does not introduce a tailored 

approach to the evaluation of 

competitive effects in rural markets, in 

cases where the relevant geographic 

market is rural, the FDIC considers all 

relevant measures of concentration, 

including the potential public interest 

benefits of a merger of two local entities 

in the local market. 

A few commenters indicated that the 

competitive effects analysis should be 

conducted on a county-level and 

capture county-level demographics such 

as median income levels or percentage 

of people of color or low-to-moderate 

income people. These comments 

suggested that such analysis should 

consider additional divestitures or 

mandate commitments to increase 

lending and banking services. It was 

also suggested that concentrations 

should be measured nationally. As 

stated in the Final Statement, the FDIC 

generally employs a framework for 

evaluating competitive effects involving 

a transaction between IDIs with 

traditional community banking 

operations within their local geographic 

markets. However, the FDIC will tailor 

its evaluation to consider the size and 

competitive effects of the resulting IDI. 

Further, the Final Statement notes that 

the FDIC identifies all relevant 

geographic markets (local, regional, and 

national) based on the geographic areas 

in which the merging entities operate 

and in which customers may practically 

turn to competitors for alternative 

products and services. If the relevant 

geographic market is shown to be at the 

county level, the county will be the 

focus of the analysis; if the relevant 

market is wider, the assessment will 

reflect that area. With respect to 

divestitures and commitments to 

increase services, such determinations 

are made depending on the facts and 

circumstances of the application. 

A couple of commenters urged the 

FDIC to de-emphasize local deposit 

concentration as a key criterion for 

deciding mergers. Other commenters 

disagreed saying evaluating the 

competitive effects of mergers based on 

product or consumer sector 

concentrations introduces 

unpredictability with unclear benefits. It 

was suggested that evidence from traffic 

patterns could also be evaluated as a 

means to assess customer use of services 

in wider areas. As noted in the Final 

Statement, deposit concentration is an 

initial proxy for commercial banking 

products and services. The FDIC will 

consider concentrations beyond those 

based on deposits. As appropriate, the 

FDIC may consider concentrations in 

any specific products or customer 

segments, such as, for example, the 

volume of small business or residential 

loan originations or activities requiring 

specialized expertise. Additionally, the 

Final Statement confirms that, when 

relevant, the analysis may incorporate 

other products offered by the merging 

entities with consideration given to 

whether consumers retain meaningful 

choices. 

Some commenters indicated that the 

FDIC should not disfavor non-compete 

agreements, and others indicated that 

non-compete clauses for workers should 

be eliminated in all mergers. Consistent 

with current practice, the Final 

Statement retains the language as 

proposed, which states that the FDIC 

will generally not view favorably 

situations where the selling institution 

enters into non-compete agreements 

with any employee of the divested 

entity or seeks to enforce any existing 

non-compete agreements with any of 

those entities. 

Two commenters noted that a de 

minimis exception is warranted for 

transactions involving highly 

concentrated rural markets. As 

previously stated, no specific metrics or 

thresholds are included as predicates to 

an evaluation of the competitive effects 

factor. 

Financial and Managerial Resources 

and Future Prospects 

Many commenters requested that the 

following statement in the proposed 

Statement be removed: ‘‘[t]he FDIC will 

not find favorably on the financial 

resources factor if the merger would 

result in a weaker IDI from an overall 

financial perspective.’’ Commenters 

contended that the statement appears to 

preclude the acquisition of weaker 

institutions during periods of economic 

distress. Commenters noted that the 

FDIC should clarify or revise its position 

regarding how it will evaluate a merger 

resulting in a weaker IDI from an overall 

financial perspective. It was also 

suggested that the FDIC could dispel 

concerns regarding how it will evaluate 

such mergers by noting it will balance 

the risks posed by the resulting IDI in 

light of the risks of denying a merger. 

The statement that ‘‘[t]he FDIC will 

not find favorably on the financial 

resources factor if the merger would 

result in a weaker IDI from an overall 

financial perspective’’ has been 

removed from the Final Statement. 

Inclusion of such language created 

confusion regarding the acquisition of a 

weaker target by a stronger acquirer 

with adequate resources to absorb and 

integrate the target. On balance, the 

FDIC determined that retention of the 

statement could be viewed as an 

indication that certain transactions 

would be precluded from receiving 

approval. The language was replaced 

with a statement that a favorable finding 

on the financial resources factor would 

be appropriate only in cases where the 

merger results in a combined IDI that 

presents less financial risk than the 

financial risk posed by the institutions 

on a standalone basis. 

With respect to the evaluation of the 

financial and managerial resources, 

commenters noted that outstanding or 

pending matters that can be resolved in 

the normal supervisory course should 

not bar an institution from pursuing 

merger transactions. The Final 

Statement affirms that the assessment of 

managerial resources includes the 

responsiveness to issues or supervisory 

recommendations raised by regulators 

or auditors as well as any existing or 

pending enforcement actions. 

Additionally, the Final Statement 

discusses the FDIC’s expectation that a 

resulting IDI will have the managerial 

and operational capacity, and devote 

adequate resources, to ensure full and 

timely compliance with any outstanding 

corrective programs or supervisory 

recommendations. The FDIC does not 

view the existence of outstanding or 

pending enforcement actions as a bar to 

the pursuit of a merger. 

Some commenters noted that the 

Final Statement should ensure that IDIs 

have more equity capital funding as a 

prerequisite for mergers (a 10 percent 

tier 1 leverage ratio was suggested). The 

Final Statement does not identify a 

specific capital threshold that would 

facilitate merger approvals; however, it 

does state that a critical component of 

the analysis of financial resources is the 

resultant IDI’s ability to meet applicable 

capital standards (including 

maintenance of appropriate allowances 

for loan or credit losses). The Final 

Statement affirms that, depending on 

the anticipated risk profile of the 

resulting IDI, the FDIC may impose, as 

a non-standard condition, capital 

requirements that are higher than 

applicable capital standards. However, 

no specific threshold is included to 

retain flexibility to assess the facts and 

circumstances of a particular 

transaction. 

Commenters noted that management 

should demonstrate the prioritization of 

diversity, equity, and inclusion in their 

practices, products, and services. They 

recommended that the FDIC take into 

consideration data from Equal 

Employment Opportunity reports and 


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13See, e.g., Statement by Senator A. Willis 

Robertson, Chairman of the Senate Committee on 

Banking and Currency, 112 Cong. Rec. 2542 (1966) 

(‘‘The banking agency may approve the merger if it 

thinks the merger will be beneficial from these 

points of view . . .’’) [emphasis added]. 

14See FDIC Statement of Policy on Bank Merger 

Transactions, 63 FR 44761, 44764 (Aug. 20, 1998) 

(‘‘In assessing the convenience and needs of the 

community to be served, the FDIC will consider 

such elements as the extent to which the proposed 

merger transaction is likely to benefit the general 

public [. . .]’’); see also, FDIC Statement of Policy 

on Bank Merger Transactions, 54 FR 39042, 39047 

(Sep. 22, 1989) (‘‘The FDIC will also consider the 

extent to which the proposed merger is likely to 

improve service to the general public [. . .]’’). 

evaluate the applicant’s efforts to 

promote gender, racial, and ethnic 

diversity in their boards, senior 

management, and branch personnel. 

The Final Statement was not amended 

to address these items. 

A commenter suggested that IDIs with 

poor records of compliance with 

climate-related goals should not be 

allowed to merge. Discussion of climaterelated goals has not been added to the 

Final Statement. However, if the 

management, compliance rating, and/or 

risk profile of the merging parties were 

adversely impacted by climate change 

challenges, the ability of the resulting 

IDI’s management team to ameliorate 

and address the climate-related risks 

may be considered in the context of the 

applicable statutory factors. 

Convenience and Needs of the 

Community To Be Served 

Multiple commenters recommended 

revisions to the discussion of the FDIC’s 

analysis of the convenience and needs 

of the community to be served. Multiple 

commenters asserted that there is no 

statutory requirement that the resulting 

IDI should better meet the convenience 

and needs of the community. These 

commenters stated that such an 

expectation is unnecessary and leaves 

the matter of determining whether it 

does so primarily at the discretion of the 

FDIC. Other commenters expressed 

support for this expectation, indicating 

that increased public benefit is of 

paramount importance. The Final 

Statement generally retains the 

approach as proposed, consistent with 

congressional intent 13 and the FDIC’s 

longstanding policy. Since October 

1998, the FDIC’s existing Statement of 

Policy has indicated the FDIC would 

consider the extent to which the 

proposed merger would likely benefit 

the general public and referenced 

examples of better banking services as 

factors for consideration of the 

convenience and needs of the 

community to be served.14

The Final Statement includes 

examples as to how the FDIC anticipates 

the resulting IDI could meet this 

expectation. For example, an applicant 

may demonstrate how the transaction 

will benefit the public through higher 

lending limits, greater access to existing 

products and services, introduction of 

new or expanded products or services, 

reduced prices and fees, increased 

convenience in utilizing the credit and 

banking services and facilities of the 

resulting IDI, or other means. While not 

explicitly stated, the evaluation also 

considers the implications if the 

transaction was not approved and how 

that decision affects the convenience 

and needs of the community. The 

expectation for a favorable finding on 

this factor is for the community to gain 

from the transaction postconsummation. Applications that 

project reduced or diminished banking 

services will generally result in 

unfavorable findings on this factor. This 

approach is consistent with current 

policy and is intended to clarify the 

FDIC’s approach to the evaluation of 

this statutory factor. 

Commenters requested that the Final 

Statement clarify that only public 

comments that meet a level of 

significance would lead to additional 

FDIC review. One commenter suggested 

that the FDIC should implement a 

vetting procedure and criteria for 

submitting a comment and not 

automatically consider all comments as 

warranting the same consideration. 

Commenters also stated that Community 

Reinvestment Act (CRA) protests that 

are unsubstantiated from factual or legal 

perspectives (including, for example, 

form protests) should not be considered 

in determining whether a public hearing 

will be held. 

As noted in § 303.2 of the FDIC Rules 

and Regulations, adverse comment(s) 

shall not include any other comment 

that is determined to be frivolous (for 

example, a non-substantive comment 

submitted primarily as a means of 

delaying action on the filing). While the 

Final Statement affirms that the FDIC 

will review and evaluate any public 

comments received in accordance with 

§ 303.9 of the FDIC Rules and 

Regulations, consideration is not given 

to frivolous letters or statements. The 

FDIC will consider substantive public 

comments received regarding the ability 

of the applicant to meet the convenience 

and needs of the community to be 

served and will provide the applicant an 

opportunity to respond to any comment 

that is determined to be a CRA protest. 

Commenters were mixed on the need 

for hearings. Some commenters agreed 

that hearings should be conducted when 

there are a significant number of CRA 

protests or the resulting IDI has over $50 

billion in total assets; others disagreed 

with using $50 billion in total assets as 

a level for which hearings will be 

conducted. One letter suggested that any 

merger protest should trigger a public 

hearing or meeting. Finally, clarification 

was sought regarding the process for 

requesting a public hearing, the 

appropriate channels, and specific 

contacts in the process. 

The Final Statement retains the 

expectation that mergers resulting in an 

IDI with over $50 billion in total assets 

will be the subject of hearings; however, 

the FDIC historically has, and will 

continue to, conduct hearings for 

transactions under this level when 

deemed appropriate. Such a 

determination will depend on the facts 

and circumstances of the proposed 

merger. In making such a determination, 

the FDIC would consider the risk profile 

of the resultant IDI, the volume and 

nature of protest letters, and the likely 

prospective impact to the convenience 

and needs of the community to be 

served. With regard to the process for 

conducting public hearings, such 

guidelines are enumerated in § 303.10 of 

the FDIC Rules and Regulations. When 

the application is filed, the publication 

document indicates the appropriate 

channel to provide comments by listing 

the address of the appropriate FDIC 

office where comments may be sent. 

Such information provides the public 

with initial contacts to discuss concerns 

with the filing that may precipitate 

public hearings. 

A few commenters stated that the 

FDIC should clarify what is meant by a 

‘‘significant number’’ of CRA protests. 

The Final Statement does not state a 

specific number of CRA protests to be 

considered ‘‘significant’’; rather, the 

FDIC considers all adverse comments 

from the public related to a pending 

filing when determining if the comment 

is deemed to rise to the level of a 

protest. Frivolous letters are not 

included. Additionally, the receipt of 

only one or two CRA protest letters may 

not be considered significant enough to 

lead to a public hearing; however, the 

FDIC retains the ability to hold a 

hearing in these instances. The decision 

to hold such hearings depends on issues 

raised during the comment period and 

the significance of the merger 

transaction to the public interest, 

banking industry, and communities 

affected. 

One commenter stated that the FDIC 

should use the most recent CRA exam, 

with the qualification that if the 

applicant has had a less than 

Satisfactory rating in any of the last 

three exams, the merger should not be 

approved until remediation plans are in 


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15 Information on public applications can be 

located here: https://cra.fdic.gov/. Information on 

FOIA requests can be located here: https://

www.fdic.gov/foia/. 

place. No changes were made to the 

Final Statement to adopt such a 

practice; however, as stated in the Final 

Statement, a less than Satisfactory 

historical rating or significant 

deterioration in CRA performance will 

generally result in unfavorable findings. 

The FDIC’s consideration of the 

convenience and needs statutory factor 

is not limited solely to the CRA record 

of the IDIs. The consideration will 

encompass a broad review, which 

includes, but is not limited to, existing 

products and services, record of 

consumer compliance, and whether the 

products and services proposed by the 

applicants will meet the convenience 

and needs of the community to be 

served. 

A commenter requested that the FDIC 

extend comment periods for community 

members to participate in the process 

from 30 days to 60 days and stated that 

clarity is needed around comment letter 

deadlines, particularly if comment 

letters received after the deadline are 

used to inform bank merger decisions. 

The comment period and deadlines for 

submitting comment letters are codified 

in § 303.65 of the FDIC Rules and 

Regulations and have not been changed. 

Some commenters requested that 

clear points of contact should be listed 

on regulatory and applicant websites, 

along with email addresses and phone 

numbers, to facilitate requests for the 

public file and/or to engage bank 

applicants and the regulator. The FDIC’s 

current website includes detailed 

instructions for the public to both file a 

Freedom of Information Act (FOIA) 

request, as well as to request the public 

portion of applications subject to the 

CRA.15

A couple of commenters stated that 

approval orders should address 

comments submitted by the public, the 

FDIC should summarize 

communications with the applicant for 

the public record, and there should be 

an administrative appeals process for 

community groups to challenge 

approvals that are inconsistent with an 

agency’s own procedures. The 

regulations governing the processes for 

filing comment letters and conducting 

public hearings have not changed and 

the Final Statement affirms the FDIC’s 

approach to these matters. 

One commenter suggested that the 

FDIC should require public statements, 

public plans, or community benefit 

agreements (CBAs), and regulators 

should examine for compliance with 

commitments during future 

examinations. Other commenters 

disagreed with requiring and enforcing 

CBAs, stating that if the FDIC required 

CBAs, then the FDIC must enforce the 

requirements of the agreements, which 

is inconsistent with current practice. 

Further, there is no statutory basis for 

requiring and enforcing CBAs. The Final 

Statement does not address CBAs, 

which are private agreements between 

merger parties and community groups. 

The FDIC does not require CBAs or 

enforce their requirements. The Final 

Statement retains language that claims 

and commitments made to the FDIC 

may be included in the order and 

enforced post-merger through its 

ongoing supervision. 

Commenters were mixed on having 

applicants provide a three-year plan 

regarding branch actions. Commenters 

who concurred with this approach 

noted that applicants should be required 

to describe the impact branch closures 

will have on the job, credit, and 

reinvestment needs of local 

communities. Commenters who 

disagreed with this approach indicated 

that the FDIC should not force IDIs to 

hardwire plans with respect to branch 

actions, thus limiting their flexibility to 

address changing circumstances. 

Another commenter requested that 

closings should be prohibited during the 

ensuing three years. One commenter 

noted that a focus on proposed branch 

closures fails to consider the numerous 

innovations in customer service 

channels in recent decades. 

The Final Statement affirms the 

expectation for applicants to provide 

three years of information regarding 

projected branch actions consistent with 

current practice. Retaining this guidance 

clarifies the expectations for branch 

retention, expansion, closing, or 

consolidation and provides 

transparency on the timeframes that the 

FDIC will evaluate, consistent with its 

current practices. It also provides 

transparency to the industry on how the 

FDIC considers proposed changes to the 

physical locations of branches. 

Other commenters indicated that the 

evaluation of convenience and needs of 

the community should not consider job 

losses. The FDIC agrees with 

commenters that the provision about the 

impact of future branch closings on the 

loss of job employment opportunities in 

the local market area may depend on 

factors not readily predictable at the 

time of a merger transaction. However, 

the impact of any proposed merger on 

employment opportunities is relevant to 

understanding how the transaction will 

serve the convenience and needs of the 

community. Accordingly, the Final 

Statement will request that applicants 

quantify or provide information 

regarding job losses to the extent those 

are known or knowable. 

Risk to the Stability of the United States 

Banking or Financial System 

Commenters provided differing views 

with respect to language indicating that 

a transaction that would result in an IDI 

with $100 billion or more in assets 

would be subject to additional scrutiny 

in connection with evaluating its impact 

on U.S. financial stability. One 

commenter indicated this level is too 

low, as a merger resulting in an IDI 

having $100 billion of assets, would 

involve only 0.4 percent of industry 

assets, and its effects on industry 

concentration would be minor. This 

commenter pointed out that identifying 

$100 billion in total assets as the basis 

for additional scrutiny protects the very 

largest institutions from regional banks 

gaining scale and competing with them 

more directly. Conversely, another 

commenter stated the $100 billion 

benchmark for potential financial 

stability concerns is appropriate and 

should be retained; however, the 

commenter argued that the focus should 

be on domestic financial stability and 

not whether the resulting IDI would be 

a globally systemically important bank. 

Yet another commenter indicated that 

an asset size below $100 billion should 

be identified as the benchmark above 

which additional scrutiny should be 

applied to transactions. Commenters 

also requested that the FDIC clarify that 

mergers resulting in an IDI over $100 

billion in total assets will not result in 

a presumptive denial, as well as what 

kind of ‘‘additional scrutiny’’ the FDIC 

may apply to a transaction that would 

result in an IDI with $100 billion or 

more in total assets. One commenter 

suggested that the FDIC should consult 

with the DOJ when a transaction results 

in an IDI with more than $100 billion in 

assets to determine whether the benefits 

of the merger outweigh the risk that the 

IDI will pose systemic risk or be ‘‘too big 

to fail.’’ Additionally, it was suggested 

that concerns about mergers creating 

larger banks that might fail should be 

counterbalanced by the recognition that 

larger banks can better diversify across 

regions than smaller banks. Finally, it 

was noted that the financial stability 

considerations relate primarily to how a 

merger may increase risk to financial 

stability. It was recommended that the 

Final Statement address ways in which 

a merger could decrease risk to financial 

stability by fostering competition with 

the largest banks or improving the 

financial condition of a weaker bank. 


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The Final Statement retains the 

expectation that transactions resulting 

in an IDI with $100 billion in total 

assets or more would be subject to 

additional scrutiny. This is not a 

threshold for a presumptive denial. 

Identifying thresholds for transactions 

that do not present concern is 

inconsistent with the FDIC’s practice of 

evaluating all filings based on their 

specific facts and circumstances. 

The term ‘‘additional scrutiny’’ 

signals to the industry and consumers 

that a proposed transaction that results 

in an IDI with over $100 billion in assets 

will likely engender additional 

information requests, more frequent 

discussions and correspondence with 

application parties, and supplementary 

meetings and discussions with 

regulators and community groups. Such 

heightened analysis also provides the 

FDIC with additional information/data 

to evaluate. While the filing is still 

subject to the same statutory factors as 

all merger applications, and there are no 

additional elements to achieve 

regulatory approval, the timeline for a 

review of these filings may be extended 

compared to other types of filings. 

Commenters were mixed on the 

consideration of the prudential 

regulatory framework when assessing 

financial stability. One commenter 

stated the framework is inadequate to 

prevent financial instability, as 

evidenced by the IDI failures that 

occurred in 2023. Another commenter 

suggested that the FDIC should leverage 

the quarterly systemic risk data that 

firms with greater than $100 billion in 

assets file on Form FR Y–15 to analyze 

the resulting firm’s operations. One 

commenter suggested that the FDIC 

articulate how the existing framework 

does not address financial stability 

concerns. Another commenter advised 

that it is not appropriate to impose 

resolution-planning requirements via 

the Final Statement, which should be 

subject to notice and comment 

rulemaking. A commenter stated that 

the FDIC must assess and consider the 

resolvability of the resulting IDI when 

reviewing a merger transaction. This 

commenter also noted that the Final 

Statement should make it clear that the 

FDIC will consider the resulting the 

regulatory framework when assessing 

financial stability risk. 

The Final Statement states that the 

FDIC will evaluate any additional 

elements that may affect the risk to the 

U.S. banking or financial system’s 

stability. This may include the resulting 

IDI’s regulatory framework; however, 

the framework alone would not result in 

a favorable finding on this factor when 

other financial stability concerns exist. 

The framework is merely one aspect in 

the evaluation of this statutory factor, 

and the FDIC recognizes the limitations 

in relying exclusively on the regulatory 

framework as a mechanism to limit 

financial stability risks. 

Some commenters requested the 

inclusion of specific metrics to identify 

what transactions would not present 

financial stability concerns. 

Commenters also suggested that the 

Final Statement include a presumption 

that de minimis acquisitions (i.e., $10 

billion or less) do not raise new 

financial stability risks or affect the 

acquirer’s financial stability profile. No 

specific metrics or thresholds have been 

included in the Final Statement to 

identify transactions that do not present 

financial stability risks. The Final 

Statement has been revised to clarify 

that the evaluation considers the 

implications for the industry if the 

transaction is not approved or does not 

consummate. 

Effectiveness in Combatting Money 

Laundering Activities 

Only one comment letter addressed 

the effectiveness of each IDI involved in 

the proposed merger transaction in 

combating money-laundering activities. 

This commenter stated that the 

Financial Crimes Enforcement Network 

(FinCEN) should be consulted regarding 

the effectiveness of efforts to combat 

money laundering, terrorist financing, 

and other illicit activity. Further, the 

commenter suggested that FDIC should 

require banks to submit a pro-forma 

anti-money laundering risk assessment 

with the merger application and require 

institutions to conduct a comprehensive 

risk assessment within a reasonable 

time after a merger is completed. No 

changes were made to the Final 

Statement with respect to these items. 

The FDIC works collaboratively with 

FinCEN, but has sufficient information 

available to independently assess the 

effectiveness of efforts to combat money 

laundering and counter terrorist 

financing. For applicants that have less 

than satisfactory anti-money laundering 

programs, the FDIC may request a risk 

assessment to be conducted after 

consummation as a non-standard 

condition. 

Other Matters and Considerations 

Commenters also provided 

suggestions and recommendations 

outside of the Final Statement. Several 

commenters requested that the FDIC 

review, to the extent possible, the effects 

of past mergers to evaluate the 

appropriateness of any revised merger 

guidelines. Another commenter 

requested that the FDIC clarify that it is 

unlikely to approve a merger when the 

applicant has (1) recently switched its 

charter in anticipation of filing a merger 

application, or (2) has restructured the 

transaction after it (or its merger 

partner) previously submitted a merger 

application to a different banking 

agency. A commenter suggested that the 

FDIC should not approve mergers by 

IDIs that switched regulators in the last 

five years before the merger. 

A couple of commenters requested 

that the FDIC increase the scrutiny 

applied to acquisitions of IDIs by 

nonbanks such as credit unions. Such 

transactions may have a negative impact 

on State and local government budgets 

and communities, which could 

necessitate an increase in taxes. One 

commenter stated that it is entirely 

inappropriate for Federal bank 

regulators, in absence of a specific 

statutory grant of authority, to arrogate 

legislative power to consider, let alone 

approve such transactions. The Final 

Statement does not address the 

evaluation of credit union acquisitions 

of IDIs specifically; however, it does 

indicate that a credit union may need to 

provide additional information to 

enable the FDIC to evaluate the 

convenience and needs statutory factor, 

as credit unions are not subject to the 

CRA. 

One commenter stated that the FDIC 

should adopt a separate review 

framework for mergers involving 

community banks and nonbank 

acquirers to ensure the maintenance of 

existing community development 

lending and investments. One 

commenter stated that it would be 

illustrative for the FDIC to publish 

information regarding the number of 

rounds of staff review of an application, 

the dynamic between regional and 

Washington office staffs, the number of 

subsequent questions, or any estimated 

time under which action is taken on an 

application. The letter urges the FDIC to 

provide more detailed and accurate 

timing guidance in the FDIC’s 

Applications Procedures Manual. 

Finally, one commenter requested that 

the FDIC explain the weight given to 

each statutory factor; however, the FDIC 

does not assign specific weights to the 

statutory factors. 

Section 4 of the FDIC’s Applications 

Procedures Manual will be revised and 

issued subsequent to the publication of 

the Final Statement. The revised section 

4 addresses the review process and the 

dynamic between regional and 

Washington office staffs, and the 

prospective timeframes for processing. 


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16 44 U.S.C. 3501–3521. 

17 12 U.S.C. 1828(c)(1) and (2). 

18 12 U.S.C. 1828(c)(3). 

19 12 U.S.C. 1828(c)(4). 

20 12 U.S.C. 1828(c)(5). 

21 Ibid. 

22 12 U.S.C. 1828(c)(11). 

23 12 U.S.C. 1828(c)(1). A non-insured entity 

refers to any entity that is not FDIC-insured. 

24The Office of the Comptroller of the Currency 

has jurisdiction for any merger transaction between 

IDIs in which the acquiring, assuming, or resulting 

institution is a national bank or a Federal savings 

association. The Board of Governors of the Federal 

Reserve System (FRB) has jurisdiction for any 

merger transaction between IDIs in which the 

acquiring, assuming, or resulting institution is a 

State-chartered bank that is a member of the Federal 

Reserve System. The FRB also has approval 

authority under the Bank Holding Company Act for 

mergers involving bank holding companies and the 

Home Owners’ Loan Act for mergers involving 

savings and loan holding companies. Merger 

transactions that are subject to the FDIC’s review 

may also be subject to the review of State 

authorities. 

25 12 U.S.C. 1828(c). 

26A merger that includes the establishment or 

relocation of branches is also subject to approval 

under 12 U.S.C. 1828(d). 

27 12 U.S.C. 1828(c)(1)(C). 

28As noted in section 1.1 of the Applications 

Procedures Manual, a filing that is not substantially 

complete lacks the substance necessary for the FDIC 

to evaluate the statutory factors. 

29Regulatory requirements for merger 

applications are provided in 12 CFR part 303 of the 

FDIC Rules and Regulations (including subparts A 

and D) and any other Federal or State regulations, 

statutes, or laws applicable to the filing. 

IV. Administrative Law Matters 

In accordance with the requirements 

of the Paperwork Reduction Act of 1995 

(PRA),16 the agencies 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 Statement does 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. 

V. Final Statement of Policy 

The text of the Final Statement 

follows: 

FDIC Statement of Policy on Bank 

Merger Transactions 

I. Introduction 

This statement of policy (SOP) 

communicates the Federal Deposit 

Insurance Corporation’s (FDIC) 

expectations and views regarding 

applications filed pursuant to section 

18(c) of the Federal Deposit Insurance 

Act (FDI Act), which is referred to 

herein as the Bank Merger Act (BMA). 

The SOP reflects the FDIC’s 

interpretations of the BMA and its 

implementing regulations. The structure 

of the SOP follows the BMA’s core 

statutory provisions, and its content 

highlights the principles that guide the 

FDIC’s evaluation of the statutory 

factors for a merger application. 

The BMA prohibits an insured 

depository institution (IDI) from 

engaging in a merger transaction 

without regulatory approval. It 

identifies the types of undertakings that 

constitute ‘‘merger transactions’’ and 

outlines which of the three Federal 

banking agencies is the ‘‘responsible 

agency’’ for acting on a given merger 

application.17 In addition, the BMA sets 

forth advance public notice 

requirements 18 and generally requires 

the responsible agency to request a 

report on the competitive factors for a 

merger transaction from the Attorney 

General.19

The BMA generally prohibits the 

responsible agency from approving a 

monopolistic or otherwise 

anticompetitive merger transaction.20 In 

addition to competitive considerations, 

the BMA requires the relevant agency to 

evaluate a merger transaction in light of 

the financial and managerial resources 

and future prospects of the existing and 

proposed institutions, the convenience 

and needs of the community to be 

served, the risk to the stability of the 

United States (U.S.) banking or financial 

system,21 and the effectiveness of the 

IDIs involved in the merger transaction 

in combatting money laundering.22

II. Jurisdiction and Scope 

The FDIC is one of three Federal 

banking agencies with responsibility for 

evaluating transactions subject to the 

BMA. The FDIC has jurisdiction to act 

on merger applications that involve an 

IDI and any non-insured entity,23 and 

those that solely involve IDIs in which 

the acquiring, assuming, or resulting 

institution is an FDIC-supervised IDI.24

The BMA requires regulatory approval 

for any merger transaction involving an 

IDI.25 The applicability of the BMA will 

depend on the facts and circumstances 

of the proposed transaction. In addition 

to transactions that combine institutions 

into a single legal entity through merger 

or consolidation, the scope of merger 

transactions subject to approval under 

the BMA encompasses transactions that 

take other forms, including purchase 

and assumption transactions or other 

transactions that are mergers in 

substance, and assumptions of deposits 

or other similar liabilities.26

For BMA purposes, the FDIC 

considers transactions to be mergers in 

substance when a target would no 

longer compete in the market, regardless 

of whether the target plans to liquidate 

immediately after consummating the 

transaction. An example of a transaction 

that is a merger in substance, and 

therefore subject to the BMA, is when 

an IDI absorbs all (or substantially all) 

of a target entity’s assets and the target 

entity dissolves (or otherwise ceases to 

engage in the acquired lines of business 

such that the target is no longer a viable 

competitor). 

An FDIC-supervised IDI’s assumption 

of a deposit from another IDI, or any 

IDI’s assumption of a deposit from a 

non-insured entity, is likewise subject to 

FDIC approval even in the absence of an 

express agreement for a direct 

assumption. Similarly, a transfer of 

deposits from any IDI to a non-insured 

entity is subject to FDIC approval.27 The 

definition of ‘‘deposit’’ per section 3(l) 

of the FDI Act extends beyond 

traditional demand deposits to include 

trust funds and escrow funds, among 

other items. 

Merger and other corporate 

transactions may be conducted through 

a single transaction or through a series 

of related transactions that each require 

an application, such as transactions 

effected through interim institutions. In 

all cases, the FDIC will evaluate the 

substance of all of the facts and 

circumstances of the transaction and 

any related transactions, identify which 

aspects of the transaction(s) are subject 

to FDIC approval, and fully evaluate the 

applicable statutory factors in a manner 

that is appropriate to each transaction. 

III. Application Process and 

Adjudication 

Overview of the Application Process 

The FDIC encourages prospective 

applicants to engage in a pre-filing 

process to discuss regulatory 

expectations. It is particularly important 

for the application to be substantially 

complete when initially filed.28 The 

quality and comprehensiveness of a 

filing are critical to the FDIC’s 

evaluation of the application under the 

statutory factors and other regulatory 

requirements.29 The FDIC expects all 

submitted materials, including the 

financial projections and any related 

analyses, to be well supported and 

sufficiently detailed. The narrative 

describing the analysis and evaluation 

of the transaction should be supported 

by studies, surveys, analyses and 

reports, including those prepared by or 

for officers, directors, or deal team 

leads. Incomplete filings or nonresponsiveness to additional 

information requests impede the FDIC’s 


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30Applications In Process Subject to the CRA 

Report Selection Options, https://cra.fdic.gov/. 

31 12 CFR 303.2(l) defines the term ‘‘CRA protest’’ 

to mean any adverse comment from the public 

related to a pending filing that raises a negative 

issue relative to the CRA, whether or not it is 

labeled a protest and whether or not a hearing is 

requested. An ‘‘adverse comment’’ is defined under 

§ 303.2(c) of the FDIC Rules and Regulations, as any 

objection, protest, or other adverse written 

statement submitted by an interested party relating 

to a filing. 

32See 12 CFR 303.2(c) and (l). 

33See 12 CFR 303.10. 

34 12 U.S.C. 1828(c)(4). In addition to acting to 

prevent the probable failure of an IDI, section 

18(c)(4)(C) of the FDI Act includes exceptions for 

merger transactions involving solely an IDI and one 

or more of its affiliates. 

35FDIC Delegations of Authority for Supervisory 

Filings, Enforcement Matters, Capital 

Determinations, and Information Sharing 

Agreements, Seal No. 086825 (October 20, 2020); 

available at https://www.fdic.gov/bankexaminations/delegations-authority. 

36 Id. at (K)(4)(i)(ii) (Reserving to the FDIC Board 

the authority to approve merger applications where 

‘‘[o]ne or more of the statutory factors enumerated 

in section 18(c)(5) and (11) of the FDI Act (12 U.S.C. 

1828(c)(5) and (11)) is not favorably resolved’’). 

ability to fully evaluate and resolve the 

statutory factors. 

Public feedback is an important 

component of the FDIC’s review of a 

merger application. Section 18(c)(3) of 

the FDI Act requires that public notice 

of the proposed merger transaction be 

published in an approved form and at 

appropriate intervals in a newspaper or 

newspapers of general circulation. A list 

of pending merger applications subject 

to the Community Reinvestment Act 

(CRA) is available on the FDIC’s website 

using the Applications in Process 

Subject to the CRA Report Selection 

Options.30 In all cases, the FDIC will 

review and evaluate any public 

comments received regarding the merger 

application, and will provide the 

applicant an opportunity to respond to 

any comment that is determined to be 

a CRA protest.31 The FDIC will also 

consider the views of each relevant 

Federal and State agency. Generally, the 

FDIC will not approve a merger 

application if adverse CRA comments 

have not been resolved.32 In certain 

cases, the FDIC may hold hearings or 

other proceedings in connection with 

evaluating a merger application.33

Section 18(c)(4) of the FDI Act 

requires the FDIC to request a 

competitive factors report from the 

Attorney General of the United States 

for any merger transaction between an 

IDI and a non-affiliated entity, unless 

the FDIC finds that it must act 

immediately in order to prevent the 

probable failure of an IDI involved in 

the transaction.34 As circumstances 

warrant, the Department of Justice (DOJ) 

and the FDIC will coordinate the review 

when there are concerns or questions 

regarding the competitive effects of the 

transaction. As described below, the 

FDIC undertakes an independent review 

consistent with the statutory factors of 

the BMA. 

Merger Application Adjudication 

Generally, if all statutory factors are 

favorably resolved, and all other 

regulatory requirements are satisfied, 

the FDIC will approve the merger 

application. Approvals will be subject to 

the standard conditions detailed in 

§ 303.2(bb) of the FDIC Rules and 

Regulations and any non-standard 

conditions deemed appropriate by the 

FDIC. Generally, the imposition of 

conditions will be taken into account as 

part of the FDIC’s consideration of the 

merger application, but will not 

necessarily lead to the favorable 

resolution of any statutory factor where 

the facts and circumstances are 

otherwise unfavorable. The Order and 

Basis (Order) will be posted to the 

FDIC’s public web page. The Order will 

address all statutory factors, as well as 

summarize information regarding any 

CRA protests. The FDIC will summarize 

the related analysis and conclusions, 

and in the cases of approval, will 

include any conditions imposed in 

conjunction with the approval. 

The FDIC’s publicly available 

Delegations of Authority set forth 

criteria that must be satisfied in order 

for staff in the FDIC Regional Offices or 

Washington Office to approve a merger 

application.35 Notably, the FDIC Board 

of Directors (FDIC Board) reserves the 

authority to deny any merger 

application or act on certain types of 

proposed transactions, including any 

transaction for which one or more 

statutory factors are not favorably 

resolved.36 Therefore, applications that 

do not warrant a favorable finding on 

one or more statutory factors are 

required to be elevated to the FDIC 

Board for additional review and final 

disposition. In addition, the FDIC Board 

notably reserves authority to act on any 

application in which the merging 

institutions operate in the same relevant 

geographic market(s) and for which the 

Attorney General has not notified the 

FDIC in writing that the proposed 

transaction would not have a 

significantly adverse effect on 

competition or for which the Attorney 

General has notified the FDIC that the 

merger transaction would have a 

significantly adverse effect on 

competition. 

Generally, applications which include 

one or more of the following 

circumstances will present significant 

concerns and will likely result in 

unfavorable findings with regard to one 

or more statutory factors: 

• Non-compliance with applicable 

Federal or State statutes, rules, or 

regulations (this includes, for example, 

transactions that would exceed the 10 

percent nationwide deposit limit, as 

well as both issued and pending 

enforcement actions); 

• Unsafe or unsound condition 

relating to the existing merger parties or 

the resulting IDI; 

• Less than satisfactory examination 

ratings, including for any specialty areas 

(i.e., information technology or trust 

examinations); 

• Significant concerns regarding 

financial performance or condition, risk 

profile, or future prospects; 

• Inadequate management, including 

significant turnover, weak or poor 

corporate governance, or lax oversight 

and administration; or 

• Incomplete, unsustainable, 

unrealistic or unsupported projections, 

analyses, and/or assumptions. 

Additionally, the FDIC may not be 

able to find favorably on any given 

statutory factor (and the application as 

a whole) if there are unresolved 

deficiencies, issues, or concerns 

(including with respect to any public 

comments). A lack of sustained 

performance under corrective programs 

would also be inconsistent with a 

favorable finding on one or more 

statutory factors, particularly when the 

transaction implicates the areas that are 

the subject of the corrective program. 

Further, the inability or unwillingness 

of the applicant to agree to proposed 

conditions or execute written 

agreements, if deemed necessary, would 

result in unfavorable findings and 

would require action by the FDIC Board 

on the application. 

If FDIC staff finds unfavorably on one 

or more statutory factors based on the 

application review, staff generally will 

recommend denial of the application. At 

the FDIC’s discretion, applicants may be 

offered the opportunity to withdraw the 

filing. If an applicant withdraws their 

filing, the FDIC Board may release a 

statement regarding the concerns with 

the transaction if such a statement is 

considered to be in the public interest 

for purposes of creating transparency for 

the public and future applicants. 

IV. Statutory Factors 

Merger applications are evaluated 

under the framework of statutory factors 

as described in the BMA. Generally, the 

BMA prohibits approval of monopolistic 

or otherwise anticompetitive 

transactions; and requires the 

responsible agency to consider specific 

statutory factors related to financial and 


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37 12 U.S.C. 1828(c)(5), 1828(c)(11), and 

1828(c)(13). 

38 12 U.S.C. 1828(c)(5). 

39Such competitors may include, but are not 

limited to, credit unions, thrifts, and Farm Credit 

System institutions. 

40See United States v. Philadelphia National 

Bank, 374 U.S. 321 (1963). 

41 Indicators of market concentration and change 

in concentration include calculations using the 

Herfindahl-Hirschman Index (HHI). 

42 12 U.S.C. 1828(c)(13). 

43 12 U.S.C. 1828(c)(13)(B). 

managerial resources and future 

prospects, convenience and needs of the 

community to be served, combatting 

money laundering, and financial 

stability. The BMA also prohibits 

interstate mergers in which the resulting 

IDI would control more than 10 percent 

of the deposits of IDIs in the United 

States.37 Evaluations of each statutory 

factor consider the respective entities’ 

supervisory records, potential risks and 

compensating controls, and any other 

available information deemed 

appropriate. 

Monopolistic or Anticompetitive Effects 

The FDIC strives to ensure that 

resulting IDIs continue as participants 

in a competitive environment. Section 

18(c)(5) of the BMA prohibits the FDIC 

from approving a merger transaction 

that would result in a monopoly or 

would be in furtherance of an attempt 

to monopolize the business of banking 

in any part of the U.S. The BMA also 

prohibits the FDIC from approving a 

merger transaction that may 

substantially lessen competition in any 

section of the country, unless the 

anticompetitive effects of the proposed 

transaction are clearly outweighed in 

the public interest by the probable effect 

of the transaction in meeting the 

convenience and needs of the 

community to be served.38 For example, 

such a circumstance may exist where a 

transaction is necessary to prevent the 

probable failure of an IDI. In addition, 

the FDIC recognizes that mergers in 

rural markets involving local 

community IDIs may result in 

concentrated markets, and the FDIC will 

carefully balance the competitive effects 

of such a merger with the public interest 

served by the ability of the resulting IDI 

to serve the convenience and needs of 

the community. 

The FDIC will evaluate the 

competitive effects of a proposed merger 

in a manner that is most relevant to each 

transaction. Consistent with the 

majority of merger transactions typically 

presented to the FDIC, the FDIC 

generally employs a framework for 

evaluating competitive effects involving 

a transaction between IDIs with 

traditional community banking 

operations within their local geographic 

markets. However, the FDIC will tailor 

its evaluation to consider the size and 

competitive effects of the resulting IDI. 

Additionally, the FDIC will consider all 

relevant market participants. For 

example, the FDIC may include any 

other financial service providers that the 

FDIC views as competitive with the 

merging entities, including providers 

located outside the geographic market 

when it is evident that such providers 

materially influence the market.39

Further, in cases involving merging 

entities with specialty lines of business 

or non-traditional products, services, or 

delivery methods, the FDIC will take 

into account any additional data sources 

or appropriate analytical approaches to 

fully assess the competitive effects of 

the transaction. 

In assessing competitive effects, the 

FDIC considers concentrations with 

respect to both geographic and product 

markets. The FDIC identifies all relevant 

geographic markets (local, regional, and 

national) based on the areas in which 

the merging entities operate and in 

which customers may practically turn to 

competitors for alternative products and 

services.40 The FDIC uses deposits as an 

initial proxy for commercial banking 

products and services. The FDIC will 

initially measure the respective shares 

of total deposits held by the merging 

entities and the various other 

participants with offices in the 

geographic market. The FDIC evaluates 

the market concentration and change in 

market concentration in each geographic 

and product market.41

In addition, the FDIC will consider 

concentrations beyond those based on 

deposits. As appropriate, the FDIC may 

consider concentrations in any specific 

products or customer segments, such as, 

for example, the volume of small 

business or residential loan originations 

or activities requiring specialized 

expertise. Additionally, when relevant, 

the analysis may incorporate other 

products offered by the merging entities, 

and will consider whether consumers 

retain meaningful choices. In its 

analysis, the FDIC will evaluate a 

market with a scope that is appropriate 

to the products or services offered or 

planned. Moreover, the FDIC will 

consider the emergence of new 

competitors for products or services in 

relevant markets; and the expansion of 

products and services offered by the 

merging entities and other market 

participants. Finally, as necessary or 

appropriate, the FDIC will consider 

other products or services and 

additional methods of assessing the 

competitive nature of markets. In 

particular, the FDIC may consider 

information on the pricing of products 

and services to assess the competitive 

effects of a proposed merger when 

practicable and relevant. 

The FDIC will continue to undertake 

an independent analysis of the 

competitive factors associated with a 

given merger transaction. The FDIC’s 

analysis is guided by the principles 

outlined above, but is also informed by 

the Department of Justice’s approach to 

evaluating competitive effects. As noted 

above, the FDIC Board reserves 

authority to act on any application for 

which the Attorney General has not 

notified the FDIC that the proposed 

transaction would not have a 

significantly adverse effect on 

competition. In such cases, applicants 

would need to demonstrate that the 

anticompetitive effects of the merger 

transaction would be outweighed in the 

public interest by the probable effect of 

the transaction in meeting the 

convenience and needs of the 

community to be served. 

The FDIC may require divestitures of 

business lines, branches, or portions 

thereof as a means to mitigate 

competitive concerns before allowing 

the merger to be consummated. In such 

cases, the FDIC generally expects that 

the selling IDI will neither enter into 

non-compete agreements with any 

employee of the divested entity nor 

enforce any existing non-compete 

agreements with any of those entities. 

Additionally, the FDIC may request an 

IDI divesting or otherwise closing a 

branch in connection with the 

transaction to waive any terms or 

conditions that preclude the ability of 

other IDIs to lease or purchase the 

property. 

Nationwide Deposit Cap 

The BMA prohibits approval of an 

interstate merger that results in an IDI 

(and its affiliates) controlling more than 

10 percent of the total deposits of IDIs 

in the U.S.42 This prohibition does not 

apply to transactions that involve one or 

more IDIs in default or in danger of 

default.43 Consistent with the 

competitive effects review, the FDIC 

will use the most current Summary of 

Deposits data to confirm the nationwide 

deposit share of the resulting IDI 

following the proposed transaction. 

Financial Resources 

The BMA requires the responsible 

agency to consider the financial 

resources of the existing and proposed 

entities involved in a merger 


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44 12 U.S.C. 1828(c)(5). 

45This evaluation encompasses capital, asset 

quality, earnings, liquidity, and sensitivity to 

market risk, as described in the Uniform Financial 

Institution Rating System (UFIRS); see 61 FR 67021 

(December 19, 1996). 

46See generally note 41. 

47Refer to the applicable capital regulations for 

the relevant parties. The minimum capital ratios for 

FDIC-supervised IDIs are set forth at 12 CFR 324.10, 

and the capital measures and capital category 

definitions for the purposes of Prompt Corrective 

Action are set forth at 12 CFR 324.403 for FDICsupervised IDIs. 

48 12 U.S.C. 1828(c)(5). 

49 81 FR 79473 (Nov. 14, 2016). 

50The management rating is defined in the 

UFIRS. See footnote 28. 

51The Anti-Money Laundering Act of 2020 (the 

AML Act) amended subchapter II of chapter 53 of 

title 31 United States Code (the legislative 

framework commonly referred to as the Bank 

Secrecy Act or BSA). The AML Act requires the 

Financial Crimes Enforcement Network (FinCEN), 

in consultation with Federal functional regulators, 

to promulgate AML/CFT regulations. Due to the 

addition of the CFT, and for consistency with 

FinCEN, the FDIC will use the term AML/CFT 

(which includes BSA) when referring to, issuing, or 

amending regulations to address the requirements 

of the AML Act of 2020. 

52 12 U.S.C. 1828(c)(5). 

transaction.44 The FDIC expects that the 

resulting IDI will reflect sound financial 

performance and condition.45 Generally, 

a favorable finding on the financial 

resources factor would be appropriate 

only in cases where the merger results 

in a combined IDI that presents less 

financial risk than the financial risk 

posed by the institutions on a 

standalone basis.46

A critical component of the analysis 

of financial resources is the resultant 

IDI’s ability to meet applicable capital 

standards (including maintenance of 

appropriate allowances for loan or 

credit losses). Depending on the 

anticipated risk profile of the resulting 

IDI, the FDIC may impose, as a nonstandard condition, capital 

requirements that are higher than 

applicable capital standards.47 Further, 

as appropriate, the FDIC may impose a 

non-standard condition that requires the 

resulting IDI and other relevant parties 

(such as certain affiliates or investors) to 

enter into one or more written 

agreements that address, as applicable, 

capital maintenance requirements, 

liquidity or funding support, affiliate 

transactions, and other relevant 

provisions. The FDIC also expects the 

resulting IDI to maintain sufficient 

liquidity and appropriate funding 

strategies given its size, complexity, and 

risk profile. 

The FDIC will also consider the 

current and projected financial impact 

of any related entities on the IDI, 

including the parent organization and 

any key affiliates. For each relevant 

entity, the FDIC will consider, among 

other items, the size and scope of 

operations, capital position, quality of 

assets, overall financial performance 

and condition, compliance and 

regulatory history, primary revenue and 

expense sources, and funding strategies. 

Managerial Resources 

The BMA requires the responsible 

agency to consider the managerial 

resources of the existing and proposed 

entities involved in a merger 

transaction.48 The FDIC expects that the 

directors, officers, and as appropriate, 

principal shareholders (collectively, 

management) possess the capabilities to 

administer the resultant IDI’s affairs in 

a safe and sound manner, and 

effectively implement post-merger 

integration plans and strategies. 

The capability of management to 

identify, measure, monitor, and control 

risks and ensure a safe and sound 

operation in compliance with applicable 

laws and regulations is included in the 

evaluation of managerial resources. The 

FDIC will consider the background and 

experience of each member of 

management relative to the size, 

complexity, and risk profile of the 

resulting IDI, including the managerial 

performance and supervisory record of 

affiliates and subsidiaries. 

The FDIC will review supervisory 

assessments of management made by 

the relevant regulatory authorities, as 

well as the nature and extent of 

organizational relationships. The FDIC 

will also evaluate the effect of such 

relationships on the IDI, as well as the 

operating history, risk management, and 

control environment of the parent 

organization. Inherent in these 

considerations are the condition, 

performance, risk profile, and prospects 

of the organization as a whole, as well 

as the consistency of the proposed 

merger with the resulting IDI’s strategic 

(or business) plan. 

The FDIC will assess each IDI’s record 

of compliance with respect to consumer 

protection, fair lending, and other 

relevant consumer laws and regulations. 

The FDIC will analyze the compliance 

management system of each of the IDIs, 

as well as the compliance management 

system for the resulting IDI to ensure 

that appropriate controls will be 

implemented to identify, monitor, and 

address consumer compliance risks. 

Consideration will also be given to the 

consumer compliance rating pursuant to 

the Uniform Interagency Consumer 

Compliance Rating System and the CRA 

rating.49

Additional managerial resource 

considerations include: 

• The supervisory history of each 

entity involved in the proposed merger, 

including the management rating 50 for 

any IDI involved in the transaction; 

• The breadth and depth of 

management, and adequacy of 

succession planning; 

• Management’s responsiveness to 

issues or supervisory recommendations 

raised by regulators or auditors; 

• Any existing or pending 

enforcement actions; 

• Any issues or concerns with regard 

to specialty areas including information 

technology, trust, consumer compliance, 

CRA, or Anti-Money Laundering (AML)/ 

countering the financing of terrorist 

activities (CFT); 51

• The reasonableness of fees, 

expenses, and other payments made to 

insiders; and 

• Recent rapid growth and the record 

of management in overseeing and 

controlling risks associated with such 

growth. 

The FDIC expects management to 

develop and implement effective plans 

and strategies, and the resulting IDI to 

have the managerial and operational 

capacity to integrate the acquired entity. 

Effective integration includes, but is not 

limited to, human capital; products and 

services; operating systems, policies, 

and procedures; internal controls and 

audit coverage; physical locations; 

information technology; and risk 

management programs. In conjunction 

with the integration, the FDIC expects a 

resulting IDI to have the managerial and 

operational capacity, and to devote 

adequate resources, to ensure full and 

timely compliance with any outstanding 

corrective programs or supervisory 

recommendations. 

Future Prospects 

The BMA requires the responsible 

agency to consider the future prospects 

of the existing and proposed entities 

involved in a merger transaction.52 The 

FDIC expects that the resulting IDI will 

operate in a safe and sound manner on 

a sustained basis following 

consummation of the merger. Among 

other items, the FDIC will consider the 

economic environment, the competitive 

landscape, the acquiring IDI’s history in 

integrating merger targets and managing 

growth, the anticipated scope of the 

resulting IDI’s operations, the quality of 

its supporting infrastructure, and other 

pertinent factors. Any significant 

planned changes to the resulting IDI’s 

strategies, operations, products or 

services, activities, income or expense 

levels, or other key elements of its 

business will be closely assessed. The 

FDIC will review the pro forma financial 


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53 12 U.S.C. 2902(3)(E) and 2903(a)(2). 

54See generally note 41. 

55 12 U.S.C. 2902(3)(E) and 2903(a)(2). 

56Transactions involving a credit union may 

require additional information to evaluate the 

convenience and needs statutory factor, as credit 

unions are not subject to CRA. 

57See generally note 41. 

58Uniform Interagency Consumer Compliance 

Rating System, 81 FR 79473 (Nov. 14, 2016). 

59 Generally, the FDIC considers a substantially 

complete merger application to include, among 

other items, at least three years of information 

regarding projected branch expansions, closings, or 

consolidations. Short-distance consolidations that 

may not be subject to section 42 outside of a merger 

context should be included in this information. In 

certain cases, the FDIC may impose non-standard 

conditions requiring prior approval or additional 

notice in connection with branch closings or 

consolidations. 

60 64 FR 34845 (June 29, 1999). 

61See generally note 41. 

62 12 CFR 303.9. 

63 12 U.S.C. 1828(c)(5). 

projections, the underlying 

assumptions, and any accompanying 

valuations (such as those related to the 

target entity, goodwill, or other assets) 

for both the existing and proposed 

entities to ensure they demonstrate and 

support that the resulting IDI will 

maintain an acceptable risk profile. 

Convenience and Needs of the 

Community To Be Served 

The BMA requires the responsible 

agency to consider the convenience and 

needs of the community to be served 

when evaluating a merger transaction.53

The FDIC expects that a merger between 

IDIs will enable the resulting IDI to 

better meet the convenience and the 

needs of the community to be served 

than would occur absent the merger in 

order to find favorably on this factor.54

Applicants are expected to demonstrate 

how the transaction will benefit the 

public through higher lending limits, 

greater access to existing products and 

services, introduction of new or 

expanded products or services, reduced 

prices and fees, increased convenience 

in utilizing the credit and banking 

services and facilities of the resulting 

IDI, or other means. 

The FDIC expects applicants to 

provide specific and forward-looking 

information to enable the FDIC to 

evaluate the expected benefits of the 

merger on the convenience and needs of 

the community to be served. As 

appropriate, claims and commitments 

made to the FDIC to support the 

evaluation of the expected benefits of 

the merger may be included in the 

Order, and through ongoing supervisory 

efforts, the FDIC will evaluate the IDI’s 

adherence with any such claims and 

commitments. The FDIC will evaluate 

the community to be served broadly, 

which will include the proposed 

assessment area(s), retail delivery 

systems, populations in affected 

communities, and identified needs for 

banking services. 

As part of its evaluation, the FDIC 

will review the CRA record of the IDIs. 

The CRA requires the FDIC to take into 

account each IDI’s record of meeting the 

credit needs of its entire community, 

including low- and moderate-income 

neighborhoods, consistent with the safe 

and sound operation of such 

institution.55 As such, the FDIC will 

consider each IDI’s CRA performance 

evaluation record of helping to meet the 

credit needs of its assessment areas, 

including low- and moderate-income 

neighborhoods, and record of 

community development activity, as 

applicable.56 A less than Satisfactory 

historical rating or significant 

deterioration in CRA performance will 

generally result in unfavorable 

findings.57 The FDIC’s review is not 

limited to the CRA record of the IDIs 

and will encompass a broad review of 

the institutions’ existing products and 

services and whether the products and 

services proposed by the applicants will 

meet the convenience and needs of the 

community to be served. 

In addition, the FDIC will consider 

the record of each IDI in complying with 

consumer protection requirements and 

maintaining a sound and effective 

compliance management system. This 

review will include consideration of any 

existing or pending orders, ongoing 

enforcement actions, and pending 

reviews or investigations of violations of 

consumer protection laws and 

regulations. A less than Satisfactory 

consumer compliance rating 58 may 

present significant concerns in resolving 

this factor. 

The CRA assessment area(s) and 

branch locations resulting from the 

merger are evaluated as part of this 

factor. The assessment area(s) should be 

delineated in accordance with 12 CFR 

part 345 of the FDIC Rules and 

Regulations (or other appropriate 

regulations), and should not reflect 

illegal discrimination. The FDIC will 

evaluate all projected or anticipated 

branch expansion, closings, or 

consolidations for the first three years 

following consummation of the 

merger.59 Branch closings are subject to 

both section 42 of the FDI Act and the 

Interagency Policy Statement 

Concerning Branch Closing Notices and 

Policies.60 Information regarding any 

proposed or expected closures, 

including the timing of each closure, the 

effect on the availability of products and 

services, particularly to low- or 

moderate-income individuals or 

designated areas, any job losses or lost 

job opportunities from branching 

changes, and the broader effects on the 

convenience and needs of the 

community to be served will be closely 

evaluated. Applications that project 

material reductions in service, 

especially to low- and moderate-income 

communities or consumers, will 

generally result in unfavorable 

findings.61

The FDIC will consider all substantive 

public comments received in 

accordance with § 303.9 of the FDIC 

Rules and Regulations,62 as well as the 

views of relevant State and Federal 

regulators regarding the ability of the 

applicant to meet the convenience and 

needs of the community to be served. 

Non-standard conditions may be 

imposed, as appropriate, in response to 

CRA weaknesses, relevant regulator 

input, bank commitments, or public 

comments. The FDIC will consider 

whether it is in the public interest to 

hold a hearing for merger applications, 

and generally expects to hold a hearing 

for any application resulting in an IDI 

with greater than $50 billion in assets or 

for which significant CRA protests are 

received. The FDIC may also hold 

public or private meetings to receive 

input on the transaction. The decision 

to hold such meetings depend on issues 

raised during the comment period and 

the significance of the merger 

transaction to the public interest, to the 

banking industry, and communities 

affected. 

As noted above, the BMA prohibits 

the FDIC from approving a merger 

transaction that may substantially lessen 

competition in any section of the 

country, unless the anticompetitive 

effects of the proposed transaction are 

clearly outweighed in the public interest 

by the probable effect of the transaction 

in meeting the convenience and needs 

of the community to be served.63 A 

favorable finding on the convenience 

and needs of the community to be 

served factor may not be sufficient to 

support approval of the application 

when anticompetitive effects are 

identified. In situations where 

anticompetitive effects are identified, 

and as described above, the FDIC will 

evaluate whether the applicant has 

demonstrated that the benefits to the 

convenience and needs of the 

community will clearly outweigh the 

anticompetitive effects. 

Risk to the Stability of the United States 

Banking or Financial System 

Section 604 of the Dodd-Frank Wall 

Street Reform and Consumer Protection 


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64 12 U.S.C. 1828(c)(5). 

65The FDIC will consider data collected by the 

Federal Reserve System to monitor the systemic risk 

profile of the IDIs, which are subject to enhanced 

prudential standards under section 165 of the 

Dodd-Frank Act. 

66See generally note 41. 

67See generally note 41. 

68 In addition to considering the FDIC’s potential 

role as receiver of the resulting IDI under section 

11 of the FDI Act, it will also take into account 

possible alternative resolution scenarios. 

69See generally note 41. 

70See generally note 41. 

71 12 U.S.C. 1828(c)(11). 

72See generally note 41. 

73An IDI under an outstanding formal 

enforcement action should make substantial 

progress to correct problem(s) addressed in the 

action. Progress should be sufficient to determine 

that the AML/CFT program is now adequate. 

Act (Dodd-Frank Act) amended the 

BMA to require the FDIC to consider the 

risk posed by a merger transaction to the 

stability of the U.S. banking or financial 

system. The FDIC expects that the 

resulting IDI (or consolidated company) 

will not materially increase the risk to 

the stability of the U.S. banking or 

financial system.64 Consistent with the 

other Federal banking agencies,65 the 

FDIC evaluates this factor with respect 

to the following: 

• The size of the entities involved in 

the transaction; 

• The availability of substitute 

providers for any critical products or 

services to be offered by the resulting 

IDI; 

• The resulting IDI’s degree of 

interconnectedness with the U.S. 

banking or financial system; 

• The extent to which the resulting 

IDI contributes to the U.S. banking or 

financial system’s complexity; and 

• The extent of the resulting IDI’s 

cross-border activities. 

Generally, the FDIC will not view the 

size of the entities involved in a 

proposed merger transaction as a sole 

basis for determining the risk to the U.S. 

banking or financial system’s stability. 

However, transactions that result in a 

large IDI (e.g., in excess of $100 billion) 

are more likely to present potential 

financial stability concerns with respect 

to substitute providers, 

interconnectedness, complexity, and 

cross border activities, and will be 

subject to added scrutiny. The FDIC will 

consider the nature and scope of 

operations of the target entity, the 

resulting IDI, and any other elements 

that may also influence the risk to the 

U.S. banking or financial system’s 

stability. 

With regard to substitute providers, 

the FDIC will consider whether the 

resulting IDI provides critical products 

or services that may be difficult to 

replace, or conducts activities 

(including specific business lines) that 

comprise a relatively large share of 

system-wide activities. Concerns are 

heightened, and may preclude favorable 

resolution of this factor, in situations 

where there are limited readily available 

substitutes; as such, services may be 

disrupted or discontinued if the 

resulting IDI encounters financial 

distress or fails.66

In assessing the resulting IDI’s 

interconnectedness, the FDIC will 

consider the degree to which the 

merging entities are engaged in 

transactions or relationships with IDIs, 

affiliates of banking organizations, or 

other financial service providers. 

Consideration will be given to whether 

any exposures with creditors, 

counterparties, investors, or other 

market participants could affect the U.S. 

banking or financial system. A resulting 

IDI may present financial stability 

concerns if key aspects of its business 

(including any on- or off-balance sheet 

activities) are highly interconnected 

with other financial system participants. 

The FDIC’s evaluation of the resulting 

IDI’s contribution to the U.S banking or 

financial system’s complexity will 

consider the full scope of the IDI’s 

operations. This includes the IDI’s 

business lines, products and services, 

on- and off-balance sheet activities, 

branch network and delivery channels, 

number of account holders (including 

the volume of uninsured deposits), 

extent of information technology 

systems, and any material affiliate or 

other third-party relationships. As part 

of evaluating the resulting IDI’s impact 

on complexity, the FDIC will also 

consider its resolvability in a potential 

failure situation. The FDIC may not be 

able to find favorably on this factor 67

when the resultant IDI’s organizational 

and funding structure preclude its 

ability to (1) continue operations and 

activities until they can be sold or 

wound down, (2) sell key business lines 

or large asset portfolios, and (3) be 

marketed for sale in a manner that limits 

the potential for losses to the Deposit 

Insurance Fund.68

The extent of a resulting IDI’s crossborder activities may also have 

implications with regard to a favorable 

finding on this factor.69 The FDIC will 

consider whether cross-border activities 

comprise a material component of the 

resulting IDI’s operations and present a 

significant degree of cross-jurisdictional 

claims or liabilities. Such activities may 

present challenges from both 

supervisory and resolution perspectives 

given the potential exposure to differing 

legal requirements, geopolitical events, 

and competing national interests. 

Other Stability Considerations 

The above list of items is not 

exhaustive. The FDIC will evaluate any 

additional elements that may affect the 

risk to the U.S. banking or financial 

system’s stability. This may include the 

resulting IDI’s regulatory framework; 

however, the framework alone would 

not result in a favorable finding on this 

factor when other financial stability 

concerns exist.70 As appropriate, 

consideration may be given to the 

merging IDIs’ records with respect to 

cybersecurity and stress-testing results. 

The FDIC may also evaluate the degree 

to which the resultant IDI’s potential 

financial distress or rapid liquidation 

could cause other market participants 

with similar activities or business 

profiles to experience a loss of market 

confidence, falling asset values, or 

decreased funding options. 

Proposed transactions that solely 

involve affiliates that were related at the 

time a merger application is filed 

generally will not raise concerns with 

regard to this factor. However, each 

proposal will be reviewed to ensure that 

the resulting IDI would not present any 

new or unforeseen financial stability 

risks that may not have existed when 

the merging entities operated as 

affiliates or on a standalone basis. 

Effectiveness in Combatting Money 

Laundering Activities 

The BMA requires the responsible 

agency to consider the effectiveness of 

any IDI involved in a merger transaction 

in combatting money-laundering 

activities, including in overseas 

branches.71 The FDIC expects that 

approved merger transactions will result 

in IDIs with effective programs to 

combat AML/CFT. A favorable finding 

on this factor 72 will be based on a 

comprehensive evaluation of each 

entity’s AML/CFT program that 

includes overseas branches; policies, 

procedures, and processes; risk 

management programs; the supervisory 

record of each participating entity, the 

entity’s compliance with the BSA and 

its implementing regulations; and 

remediation efforts pursuant to an 

outstanding corrective program.73 In all 

cases, the FDIC will consider whether 

the resulting IDI has developed an 

appropriate plan for the integration of 

the combined operations into a single, 

comprehensive, and effective program 

to combat money laundering and 

terrorist financing. Additionally, the 

FDIC expects the applicant to 

demonstrate how the resulting IDI will 

comply with the BSA and its 


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74See generally note 41. 

75See 12 U.S.C. 1831u. 

76A ‘‘non-bank’’ refers to an IDI that is a bank for 

purposes of the FDI Act, but that is not a bank for 

purposes of the Bank Holding Company Act 

(BHCA). Non-banks may be owned by parent 

companies that are not subject to the BHCA, and 

therefore may not regulated or supervised by the 

FRB. 

implementing regulations following 

consummation of the merger. 

Significant unresolved AML/CFT 

concerns or uncorrected problems, or an 

outstanding or proposed formal or 

informal enforcement action that 

includes provisions related to AML/ 

CFT, will generally result in unfavorable 

findings on this factor.74 In limited 

cases, sufficient mitigating factors may 

support a favorable finding, such as 

when an acquirer with a strong AML/ 

CFT program replaces a target entity’s 

less than satisfactory program and 

presents an appropriate plan to address 

the target entity’s deficiencies. 

V. Other Matters and Considerations 

Interstate Merger Transactions 

In cases where section 44 of the FDI 

Act applies to an interstate merger 

transaction, the FDIC will ensure that 

the additional requirements and 

restrictions of section 44 are satisfied.75

Applications Involving Non-Banks or 

Banks That Are Not Traditional 

Community Banks 

Historically, most merger transactions 

considered by the FDIC have involved 

traditional community banks. In 

general, traditional community banks 

focus on providing the banking services, 

including loans and core deposits, 

typically relied on by individuals and 

businesses in their local communities. 

However, merger applications may also 

involve non-banks 76 or banks that are 

not traditional community banks, which 

may involve more complexity than a 

traditional community bank in terms of 

its business model, products, services, 

activities, market segments, funding, 

delivery channels, geographic footprint, 

operations, or intercompany or other 

third-party relationships. Merger 

applications where the resulting IDI will 

be a non-bank or not a traditional 

community bank are subject to the same 

statutory factors as any other merger 

application. However, the FDIC will 

appropriately tailor its review to the 

nature, complexity, and scale of the 

entities involved in the transaction and 

the underlying business model. The 

FDIC’s Washington Office or FDIC 

Board reserve authority to act on certain 

merger applications that do not involve 

traditional community banks. 

Applications Involving Operating NonInsured Entities 

Applications may involve an existing 

IDI merging with an operating entity 

that is not FDIC-insured. Operating noninsured entities may vary widely in the 

type of business and activities 

conducted (e.g., credit unions, which 

typically offer products and services 

consistent with a traditional community 

bank, mortgage companies, financing 

companies, payment services firms, or 

other types of entities whose business 

model may have elements more 

consistent with that of a noncommunity bank). Merger applications 

that involve an operating non-insured 

entity are subject to the same statutory 

factors as any other merger application. 

However, in reviewing such 

applications, the FDIC will also 

consider the nature and complexity of 

the non-insured entity, its scale relative 

to the existing IDI, its current condition 

and historical performance, and any 

other relevant information regarding the 

entity’s operations or risk profile. 

The FDIC will review audited 

financial statements (covering at least 

three years, unless the entity’s operating 

history is shorter) and assess any 

deferred tax assets or liabilities, 

intangible assets, contingent liabilities, 

and any recent or pending legal or 

regulatory actions. Further, independent 

appraisals or valuations may be 

necessary to support the projected value 

of any business (or assets) expected to 

be transferred from the operating noninsured entity to the resultant IDI 

through the merger transaction. 

VI. Resources 

FDIC Bank Application Resource page, 

https://www.fdic.gov/regulations/ 

applications/resources/ 

FDIC Regional Offices, https://www.fdic.gov/ 

about/contact/directory/region.html 

FDIC Law, Regulations, Related Acts, https:// 

www.fdic.gov/regulations/laws/rules/ 

Section 18(c) of the FDI Act, 12 U.S.C. 

1828(c) 

Section 42 of the FDI Act, 12 U.S.C. 1831r– 

1 

Section 44 of the FDI Act, 12 U.S.C. 1831u 

12 CFR part 303, subparts A and D 

Interagency Policy Statement Concerning 

Branch Closing Notices and Policies, 64 

FR 34845 (June 29, 1999) 

Applications Procedures Manual (APM), 

https://www.fdic.gov/bankexaminations/applications-proceduresmanual 

Section 1 of the FDIC APM, https://

www.fdic.gov/system/files/2024-07/ 

section-01-01-overview.pdf 

Section 4 of the FDIC Application Procedures 

Manual, https://www.fdic.gov/system/ 

files/2024-07/section-04-mergers.pdf 

FDIC Delegations of Authority—Filings, 

https://www.fdic.gov/regulations/laws/ 

matrix/index.html 

Interagency Bank Merger Act Form, https:// 

www.fdic.gov/formsdocuments/f6220- 

01.pdf 

Deposit Market Share Reports—Summary of 

Deposits, https://www2.fdic.gov/sod 

Federal Reserve Bank of St. Louis, 

Competitive Analysis and Structure 

Source Instrument for Depository 

Institutions, https://cassidi.

stlouisfed.org/index 

Federal Deposit Insurance Corporation. 

By order of the Board of Directors. 

Dated at Washington, DC, on September 

17, 2024. 

James P. Sheesley, 

Assistant Executive Secretary. 

[FR Doc. 2024–22189 Filed 9–26–24; 8:45 am] 

BILLING CODE 6714–01–P 

DEPARTMENT OF STATE 

22 CFR Part 126 

[Public Notice: 12515] 

RIN 1400–AF87 

Amendment to the International Traffic 

in Arms Regulations: Prohibited 

Exports, Imports, and Sales to or From 

Certain Countries—Cyprus 

AGENCY: Department of State. 

ACTION: Final rule. 

SUMMARY: The Department of State is 

amending the International Traffic in 

Arms Regulations to reflect current 

defense trade policy toward Cyprus. 

DATES: This rule is effective on October 

1, 2024. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Hershel Tamboli, Foreign Affairs 

Officer, Office of Defense Trade Controls 

Policy, U.S. Department of State, 

telephone (771) 204–0008; email 

DDTCCustomerService@state.gov. 

ATTN: Regulatory Change, ITAR 

Section 126.1 Cyprus Country Policy 

Update. 

SUPPLEMENTARY INFORMATION: The 

Department of State (the Department) 

amends section 126.1 of the 

International Traffic in Arms 

Regulations (ITAR) (22 CFR parts 120 

through 130) to specify that the 

Republic of Cyprus’ status as a 

proscribed destination is suspended 

from October 1, 2024, through 

September 30, 2025. This action 

continues the Department’s current 

policy, which originally lifted the arms 

embargo to the Republic of Cyprus, 

under section 126.1 of the ITAR, on 

October 1, 2022. 

Specifically, section 1250A(d) of the 

National Defense Authorization Act for 


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