Vedder Price is pleased to announce that it represented Byline Bancorp, Inc. (Byline), parent company of Byline Bank, in its announced merger with Inland Bancorp, Inc., parent company of Inland Bank and Trust, pursuant to which Inland will combine with Byline in a cash and stock transaction valued at approximately $165 million.
On October 18, 2022, the FDIC finalized a rule to increase initial base deposit insurance assessment rate schedules uniformly by 2 basis points, beginning in the first quarterly assessment period of 2023. The stated purpose of the increase in assessment rate schedules is to “increase the likelihood that the reserve ratio of the Deposit Insurance Fund (DIF) reaches the statutory minimum of 1.35 percent by the statutory deadline of September 30, 2028.” Click here for more information on the rule.
On March 30, 2022, the Federal Deposit Insurance Corporation (the “FDIC”) issued a notice regarding a proposed Statement of Principles for Climate-Related Financial Risk Management for Large Financial Institutions (the “Principles”). The notice also requests comments from the public on the proposed Principles. The Principles are substantively similar to those issued by the Office of the Comptroller of the Currency on December 16, 2021. As proposed, the Principles would create a high-level framework for the safe and sound management of exposures to climate-related financial risks.
On March 31, 2022, the Federal Deposit Insurance Corporation (the “FDIC”) published a Request for Information in the Federal Register (the “ROI”) soliciting comment from the public concerning the application of the laws, practices, rules, regulations, guidance, and statements of policy that apply to merger transactions involving banks, including mergers between banks and credit unions, under the Bank Merger Act (the “Bank Merger Framework”). The public comment period ends on May 21, 2022.
The FDIC has stated that the purpose of the ROI is to gauge the effectiveness of the current Bank Merger Framework in meeting the requirements of the Bank Merger Act with respect to the approval of bank mergers. Among other things, the FDIC is seeking information concerning the following factors:
- Anticompetitive/Monopolistic Factors – The FDIC is seeking to determine whether the Herfindahl-Hirschman Index (HHI) should be supplemented with other quantitative measures when considering competitive factors. The FDIC is also inquiring as to whether any such quantitative measures should be differentiated when considering mergers involving a large bank and mergers involving only small banks.
- Prudential Factors – To what extent prudential factors (e.g., capital levels, management quality, earnings, etc.) should be used in assessing the appropriateness of an application. In addition, the FDIC is seeking public comment on whether bright-line standards for prudential factors should be implemented.
- Convenience and Needs Factor – The FDIC is also seeking to determine whether reliance on a bank’s successful Community Reinvestment Act performance evaluation record is sufficient for determining whether the bank is satisfying the convenience and needs of the communities it serves. Interestingly, the FDIC is also (i) inquiring as to whether bank branch closures and consolidations should be taken into account for purpose of any review and (ii) to what extent the Consumer Financial Protection Bureau should be consulted to assist in determining whether a bank is satisfying the convenience and needs of the communities it serves.
- Presumption of Approval; Regulatory Burden – The FDIC is also seeking comments on whether the existing Bank Merger Framework creates an implicit presumption of approval, and whether the existing framework requires an appropriate burden of proof from the merger applicant.
To read the full RFI, please click here.
Please join James M. Kane and James W. Morrissey, Co-Chairs of the Financial Institutions Group, and Mark C. Svalina, Associate, at Vedder Price, for a webinar presentation on regulatory, compliance and related issues banks can expect to encounter in 2022. Continue Reading Banking Update Webinar- What to Expect in 2022