FDIC to Tighten and Clarify Interest Rate Restrictions on Institutions That are Less Than Well-Capitalized we learned from banking information website BankDeals. The FDIC's Board of Directors "proposed for comment a regulatory change in the way the FDIC administers its statutory restrictions on the deposit interest rates paid by banks that are less than Well Capitalized. Prompt Corrective Action requires the FDIC to prevent banks that are less than Well Capitalized from soliciting deposits at interest rates that significantly exceed prevailing rates. The proposed regulation would define nationally prevailing deposit rates as a direct calculation of those national averages.... Reliance on the Treasury yields in the regulation would be discontinued." FDIC Chairman Sheila Bair says, "This proposed regulation would bring much needed concreteness to the administration of these statutory interest rate restrictions. Our expectation is that this additional concreteness would result in lower deposit rates being paid by a number of banks that are less than Well Capitalized and closer adherence to the statute."
