FRB, OCC and FDIC Finalize Amendments to Interstate Branch Deposit Production Prohibition
The FRB, OCC and FDIC finalized amendments to their rules prohibiting interstate branches from being used primarily for deposit production to reflect changes required by the Gramm-Leach Bliley Act of 1999 (the "GLBA"). Historically, these rules have only prohibited a bank from establishing or acquiring a branch outside of its home state for the primary purpose of deposit production. In accordance with the GLBA, the new rules also include any branch of a bank (which for this purpose, includes the main office) controlled by an out-of-state bank holding company from being established or acquired for such a purpose. As mandated by the GLBA, to determine the home state of a bank holding company (and thus whether it is "out-of-state") the agencies will evaluate the state where the total deposits of all banking subsidiaries were largest as of the later of (1) July 1, 1966, or (2) the date on which a
