The FDIC today issued a statement and updated frequently asked questions clarifying when deposits are required to be reported as brokered. Specifically, the statement noted that “deposits placed at [insured depository institutions] by unaffiliated entities (including, for example, broker dealers) that operate under a primary purpose exception are still required to be reported as brokered if there are any additional third parties involved that qualify as a deposit broker.”
The FDIC said that its analysis of Call Report data submitted after the 2020 brokered deposits final rule took effect “suggests that some IDIs receiving sweep deposits from unaffiliated broker-dealers appear to be reporting the sweep deposits as non-brokered, despite the involvement of a third party that engages in facilitating the placement of deposits, including through engaging in matchmaking activities.” The agency reminded banks that they must be aware of any additional third parties involved when receiving sweep deposits from an unaffiliated broker dealer with a primary purpose exception.
The FDIC added that it will not require banks to refile previous Call Reports “if, after good faith efforts, certain deposits were not previously reported as brokered by the IDI due to a misunderstanding of how the facilitation aspect of the deposit broker definition applies when additional third parties are involved.”
