As you may have seen, in February we did a webinar on recent changes in the way Regulators are evaluating funding risk and the new measurements they are using to assign the “L”-Liquidity rating. As we noted, their focus has been on brokered deposits, “potentially volatile funding sources,” and “high rate deposits.” We pointed out numerous weaknesses in the way these funding sources are being assessed and limited.

If you share our concern that the current Regulatory approach to limiting brokered deposits, calculating “high rate deposits,” and evaluating funding risk is inappropriate, then now is your chance to do something about it.

The FDIC is currently considering changing their rules on brokered deposits and interest rate cap restrictions. As part of that process, they are formally seeking comments from the public via an Advanced Notice of Proposed Rulemaking (ANPR). While I normally don’t strongly believe in “the power of the pen,” this really is a chance for the industry to have some input in changing the current guidance.

Click here to read the letter I submitted, along with a copy of the posting in the Federal Register that not only provides additional background, but also outlines how to submit comments. As noted, comments are due by May 7, 2019, and can be easily submitted directly using their website or even with a quick email. I strongly advise you to join me in submitting a response in hope of getting some real Regulatory relief in this area.