Part 354 governs parent companies of industrial banks and industrial loan companies.
Adopted in Dec. 2020, requires certain conditions and written commitments, #73464.
Amendments clarify and enhance framework to supervise industrial banks, mitigate risks to the Deposit Insurance Fund and provide transparency for market participants.
CFPB Chopra issued statement, favors greater transparency and faster processing.
Proposed Amendments
Amendments proposed by the FDIC would revise the definition of covered company.
Revises scope to include conversions involving a proposed industrial bank under the Home owners’ loan act; ensure parent of industrial bank would be subject to Part 354.
If there is change in control at parent or a merger in which parent is resultant entity.
Includes reservation of authority that would allow FDIC to apply to other transactions.
Clarifies relationship between written commitments and evaluation of statutory factors.
In addition, sets forth additional criteria that the FDIC would consider when assessing the risks presented to a shell or captive industrial bank by its parent organization.
Also, in evaluating industrial bank’s ability to operate in a safe and sound manner and function independently of the parent organization, including a rebuttable presumption.
That shell/captive nature weighs heavily against favorably resolving 1 or more factors.
Consultation
Comments must be received on or before 60 days after publication in federal register.
Aug. 2024 Fed Reg Proposal
On Aug. 12, 2024, FDIC published proposal in federal register comments by Oct. 11.
In Oct. 2024, CSBS issued comment letter against proposed 354.6, see #229604.
Jul. 15, 2025 FDIC Proposal Withdrawal
On Jul. 15, 2025, FDIC reported withdrew proposed rule; also issued RFI, #262732.
Jul. 18, 2025 Fed Reg Proposal Withdrawal
On Jul. 18, 2025, FDIC issued withdrawal of proposal in federal register, as of Jul. 18.
