Key dates
- 2026-08-27
- The FDIC Board unanimously approved the final rule on unsafe or unsound practices and MRAs and the interim final rule on Road to Housing Act reciprocal deposits by notational vote.
Suggested considerations
- Compliance teams may wish to inventory open MRAs, supervisory recommendations, and section 8 enforcement matters and assess whether each matter satisfies the new material-harm, Deposit Insurance Fund risk, prudent-operation, or legal-violation criteria.
- Banks should consider mapping existing policies, procedures, reporting controls, documentation findings, and governance issues to the new distinction between MRAs, supervisory observations, and other violations, while retaining controls for matters that could affect capital, asset quality, earnings, liquidity, market-risk sensitivity, consumer outcomes, or receivership risk.
- Management and board committees may wish to prepare for examiner requests for the objective facts, risk analysis, and reasoning supporting any MRA or unsafe-or-unsound-practice conclusion, including evidence of how the bank assessed reasonably foreseeable conditions.
- Banks using reciprocal deposits should consider recalculating their permissible nonbrokered reciprocal-deposit capacity under the tiered liability formula and updating brokered-deposit classification, liquidity, deposit reporting, internal limits, and regulatory reporting controls.
- Potential agent institutions should verify their eligibility under the revised definition, including the applicable capital and examination-rating requirements and the broadened CAMELS-based criteria.
- Treasury, balance-sheet management, and deposit operations teams may wish to model the effect of the expanded reciprocal-deposit exclusion on funding concentration, liquidity stress assumptions, deposit pricing, and brokered-deposit monitoring.
- Legal and regulatory-affairs teams should monitor the Federal Register publication of both rules, confirm the effective dates, review any interim-final-rule comment opportunity, and determine whether implementation or comments are appropriate.
- Banks should consider reviewing examiner lookback requests and suspicious-activity review scopes against the related OCC examination guidance, which generally limits lookbacks involving failures to detect or report suspicious activity to one year or less unless heightened approval is obtained.
What changed
The final supervisory rule defines an unsafe or unsound practice as a practice, act, or failure to act that is contrary to generally accepted standards of prudent operation and that, if continued, is likely to materially harm the bank's financial condition or present a material risk of loss to the Deposit Insurance Fund, or that has materially harmed the bank's financial condition.
Compliance impact
The supervisory rule is a high-impact change to the framework for section 8 enforcement, board-level supervisory escalation, and corrective actions, although it does not eliminate obligations arising from applicable banking laws or regulations. The reciprocal-deposit rule may materially affect brokered-deposit classification and funding strategy for qualifying banks, with noncompliance potentially affecting regulatory reporting, liquidity-risk assessments, and supervisory conclusions.