FDIC board approves rescission of 2024 bank merger policy statement

The FDIC board of directors approved the rescission of the agency’s 2024 Statement of Policy on Bank Merger Transactions and the reinstatement of its statement of policy in effect prior to 2024.

Details: The FDIC said:

• The reinstated Bank Merger Statement of Policy is effective 30 days from the date of publication in the Federal Register.

• The agency plans to conduct a broader reevaluation of its bank merger review process.

• The Bank Merger Statement of Policy will remain in effect pending the FDIC’s review.

• The FDIC expects to seek additional public comment on its future review of bank merger policy.

Impact: When the FDIC proposed the rescission in March, it said the change seeks to address the fact that the 2024 statement added considerable uncertainty to the merger application process. The FDIC noted that while it considers broader revisions to its merger policy, it is proposing to return to the historical approach that is well-understood by market participants.

ICBA View: ICBA last summer told the FDIC that its bank merger review process requires significant revisions to be streamlined and equitable to community banks. With the announcement that the FDIC will return to the pre-2024 framework, ICBA will continue to work with the FDIC to improve the bank merger process and ensure it does not unduly scrutinize mergers between community banks.