[Federal Register Volume 86, Number 178 (Friday, September 17, 2021)]
[Notices]
[Pages 51887-51888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-20160]


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FEDERAL DEPOSIT INSURANCE CORPORATION


Notice of the FDIC's Response to Exception Requests Pursuant to 
Recordkeeping for Timely Deposit Insurance Determination

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Notice of the FDIC's response to exception requests pursuant to 
the recordkeeping for timely deposit insurance determination rule.

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SUMMARY: In accordance with its rule regarding recordkeeping for timely 
deposit insurance determination, the FDIC is providing notice that it 
has granted time-limited exception relief to two covered institutions 
from the information technology system and recordkeeping requirements 
applicable to deposits reflected on loan systems, including deposits 
resulting from credit balances on an account for debt owed to the 
covered institution and deposits held in escrow by a covered 
institution. The two covered institutions are in the process of 
converting or upgrading their loan systems.

DATES: The FDIC's grant of exception relief is effective as of 
September 14, 2021.

FOR FURTHER INFORMATION CONTACT: Cassandra Knighton, Acting Section 
Chief, Division of Complex Institution Supervision and Resolution; 
<a href="/cdn-cgi/l/email-protection#d0939bbeb9b7b8a4bfbe9096949993feb7bfa6"><span class="__cf_email__" data-cfemail="3370785d5a545b475c5d7375777a701d545c45">[email protected]</span></a>; 972-761-2802.

SUPPLEMENTARY INFORMATION: The FDIC granted a time-limited exception 
request to two covered institutions pursuant to the FDIC's rule 
entitled ``Recordkeeping for Timely Deposit Insurance Determination,'' 
codified at 12 CFR part 370 (part 370).\1\ Part 370 generally requires 
covered institutions to implement the information technology system and 
recordkeeping capabilities needed to quickly calculate the amount of 
deposit insurance coverage available for each deposit account in the 
event of failure. Pursuant to Sec.  370.8(b)(1), one or more covered 
institutions may submit a request in the form of a letter to the FDIC 
for an exception from one or more

[[Page 51888]]

of the requirements of part 370 if circumstances exist that would make 
it impracticable or overly burdensome to meet those requirements. 
Pursuant to Sec.  370.8(b)(2), the FDIC publishes a notice of its 
response to each exception request in the Federal Register. Pursuant to 
Sec.  370.8(b)(3), a covered institution may rely upon another covered 
institution's exception request which the FDIC has previously granted 
by notifying the FDIC that it will invoke relief from certain part 370 
requirements and demonstrating that the covered institution has 
substantially similar facts and circumstances to those of the covered 
institution that has already received the FDIC's approval. The 
notification letter must also include the information required under 
Sec.  370.8(b)(1) and cite the applicable notice published pursuant to 
Sec.  370.8(b)(2). Unless informed otherwise by the FDIC within 120 
days after the FDIC's receipt of a complete notification for exception, 
the exception will be deemed granted subject to the same conditions set 
forth in the FDIC's published notice.
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    \1\ 12 CFR part 370.
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    These grants of relief will be subject to ongoing FDIC review, 
analysis, and verification during the FDIC's routine part 370 
compliance tests. The FDIC presumes each covered institution is meeting 
all the requirements set forth in the Rule unless relief has otherwise 
been granted. These grants of relief may be rescinded or modified upon: 
Discovery of misrepresentation; material change of circumstances or 
conditions related to the subject accounts; or failure to satisfy 
conditions applicable to each. The following exceptions were granted by 
the FDIC as of September 14, 2021.

I. Certain Deposits Reflected on Loan Systems for Which the Covered 
Institutions Is Not Capable of Completing Deposit Insurance Calculation 
Process Because Additional Time Is Required for System Upgrades or 
Conversions

    The FDIC granted time-limited exception relief from part 370's 
information technology system requirements set forth in Sec.  370.3 and 
recordkeeping requirements set forth in Sec.  370.4 applicable to 
deposits reflected on loan systems, including deposits resulting from 
credit balances on an account for debt owed to the covered institution 
and deposits held in escrow by the covered institution. Such relief was 
granted to two covered institutions for up to 18 months after their 
compliance date. One covered institution requested exception relief 
from the recordkeeping requirements because it has multiple lending 
systems in need of recordkeeping upgrades and technical coding fixes 
without which it cannot produce the requisite data within the timeframe 
and in the format required by Sec.  370.4(d). The covered institution 
requested exception relief in order to complete its IT solution to 
integrate data into its part 370 calculation system and perform 
relevant testing. The other covered institution requested exception 
relief from the information technology system and recordkeeping 
requirements because it requires additional time to complete the 
conversion of its commercial loan servicing platform and make system 
upgrades. The FDIC granted both covered institutions a time-limited 
exception for up to 18 months from their respective compliance dates.
    In connection with the FDIC's grants of relief, these covered 
institutions represented that they will maintain the capability to 
place holds on the deposit accounts subject to the exception in the 
event of failure until deposit insurance can be calculated using data 
manually extracted from the current loan systems. As conditions of 
relief, these covered institutions must submit a status report to 
<a href="/cdn-cgi/l/email-protection#06766774723531364660626f6528616970"><span class="__cf_email__" data-cfemail="d3a3b2a1a7e0e4e393b5b7bab0fdb4bca5">[email protected]</span></a> at the midpoint of the exception relief period and 
immediately bring to the FDIC's attention any change of circumstances 
or conditions.

Federal Deposit Insurance Corporation.

    Dated at Washington, DC, on September 14, 2021.
James P. Sheesley,
Assistant Executive Secretary.
[FR Doc. 2021-20160 Filed 9-16-21; 8:45 am]
BILLING CODE 6714-01-P


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