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ABA Statement on Modernizing Brokered Deposit Rules


The American Bankers Association welcomes the Federal Deposit Insurance Corp. proposal to update brokered deposit regulations.

“We applaud FDIC Chairman McWilliams for prioritizing this important issue that affects every bank in this country, and we look forward to working with the FDIC to modernize brokered deposit regulations,” said Rob Nichols, ABA president and CEO. “The rules in place today are holding back innovation, and we believe they need to take into account the new tools customers now use to interact with their bank.”

The brokered deposit statute was written in 1989 and the rules that followed were created to discourage less than well capitalized banks from using a specific type of deposit to fund risky growth. Those regulations haven’t been updated in the decades since they were written and did not anticipate mobile and digital banking platforms.

“We support a more transparent approach to regulating bank deposit gathering that recognizes changes to bank regulation that have improved safety and soundness,” said Nichols. “We also support Chairman McWilliams’ call for Congress to revisit the brokered deposit statute and look forward to working with members of Congress as they consider a much-needed update.”

ABA previously recommended specific legislative changes to Section 29 of the FDIA, which created the brokered deposit restrictions.


About the American Bankers Association

The American Bankers Association is the voice of the nation’s $22.8 trillion banking industry, which is composed of small, regional and large banks that together employ more than 2 million people, safeguard nearly $19 trillion in deposits and extend $11 trillion in loans.

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