S.Amdt. 4393

SA 4393 is an amendment proposed by Mr. Rounds and Mr. Warner to be added to H.R. 6644. Its purpose is to address the "Keeping Deposits Local" initiative by making changes to the Federal Deposit Insurance Act.

The amendment aims to change or add the following to the bill:

• Reciprocal Deposits: It changes how certain reciprocal deposits of an agent institution are viewed, stating they will not be considered funds obtained through a deposit broker based on specific percentages of the agent institution's total liabilities:

  • 50 percent for the portion not more than $1,000,000,000.
  • 40 percent for the portion more than $1,000,000,000 but not more than $10,000,000,000.
  • 30 percent for the portion more than $10,000,000,000 but not more than $250,000,000,000.

• Agent Institution Definition: It updates the definition of an agent institution by replacing the phrase "found to have a composite condition of outstanding or good" with "assigned a CAMELS rating of 1, 2, or 3".

• FDIC Study: It adds a requirement for the Federal Deposit Insurance Corporation to conduct a study and submit a report within 180 days of the Act's enactment. This study must analyze:

  • Reciprocal deposit performance since 2018, including usage by institution size, usage during stress, and the end-user depositors driving demand.
  • The relationship between custodial and reciprocal deposits.
  • The potential risks and benefits of reciprocal deposits.