Processing of Federal Reserve Membership Applications

September 24, 2008 at 6:09 pm Leave a comment

The application process for organizing a state member bank just got a little easier. The Board of Governors of the Federal Reserve System recently released Supervisory Letter SR 08-5, which outlines a new streamlined application process for de novo bank membership applications. The Supervisory Letter touts the following benefits:

  • Reduces the application processing time by allowing organizers of a de novo state bank to file the Federal Reserve membership application simultaneously with the filing of the Interagency Charter and Federal Deposit Insurance Application form with the FDIC and the applicable state banking agency;
  • Increases coordination between the FRB, the FDIC and the applicable state banking agency to prevent the organizers from having to respond to duplicate inquiries for information regarding the applications; and
  • Simplifies the “name check” process by encouraging the responsible Reserve Bank to coordinate with the FDIC and the applicable state banking agency to enable the directors of the new institution to have all fingerprint cards made and submitted simultaneously.

While the process may have been simplified, the substantive requirements for membership have not. Organizers must take care to meet the criteria for membership set forth in Federal Reserve Regulation H (12 CFR 208.3(b)). Not only must organizers be mindful of the requirements for admission as a member of the Federal Reserve System, but they also need to consider state-specific requirements for organizing de novo banks and FDIC requirements for obtaining deposit insurance.

For more information about the Federal Reserve membership application click here.

Entry filed under: Client Alerts, Small Business/SBA/Community Banks.

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