ABA Supports Bipartisan Reciprocal Deposit Bill

ABA today wrote to members of the Senate Banking, Housing and Urban Affairs Committee in support of S. 3373, a bipartisan bill introduced by Sens. Mark Warner (D-Va.) and Jerry Moran (R-Kan.) that would clarify that reciprocal deposits of another insured depository institution are not considered brokered deposits. A similar bill was introduced last year in the House.

“The legislation is a step in the right direction toward modernizing the Federal Deposit Insurance Act to reflect current banking structure and deposit gathering practices,” ABA said, noting that the evolution of banking practices and technology mean that far more deposits are considered “brokered” by regulators than otherwise should be.