Regulators Propose Update to Management Interlock Rules

The financial regulatory agencies today issued a joint proposal to raise the threshold at which bank directors or other management officials are prohibited from serving at more than one depository institution or holding company. Currently, directors or management officials working at an institution with more than $2.5 billion in total assets may not simultaneously serve at an unaffiliated depository organization with more than $1.5 billion in total assets. The proposal would raise both of those thresholds to $10 billion in total assets.

The agencies are proposing to raise the major assets prohibition thresholds to $10 billion to account for changes in the United States banking market since the current thresholds were established in 1996, in response to feedback received during the recent decennial Economic Growth and Regulatory Paperwork Reduction Act review. Comments on the proposal will be due 60 days after publication in the Federal Register.