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Federal Reserve Bank
of

Dallas

R OB ERT D. McTEER, JR.
DALLAS, TEXAS

PRESIDENT
AND CHIEF EXECUTIVE OFFICER

75265-5906

June 24, 1998
Notice 98-52

TO: The Chief Executive Officer of each
state member bank and bank holding company
in the Eleventh Federal Reserve District

SUBJECT
Interagency Policy Statem ent on
Branch Names
DETAILS
The Board of Governors of the Federal Reserve System and the other federal banking
agencies have issued an interagency policy statement concerning the practice of insured deposi­
tory institutions operating branches of the same institution under different trade names. The
agencies are concerned that if depositors believe that such facilities are operated by separate
institutions, they may inadvertently exceed Federal Deposit Insurance Corporation (FDIC)
insurance limits by depositing excess amounts in accounts in different branches of the same
institution. The agencies believe it is important that customers understand fully the scope of
FDIC deposit insurance coverage in these circumstances.
The interagency policy statement emphasizes that an insured depository institution
that intends to use different names for various branches or other facilities of the same institution
should take reasonable steps to ensure that customers will not become confused and believe that
its facilities or branches are separate institutions, or that deposits in different facilities are sepa­
rately insured. The policy statement describes various steps that should be taken to avoid confu­
sion regarding federal deposit insurance coverage.
ATTACHMENT
A copy of the interagency statement, which becomes effective July 1, 1998, is
attached.

For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal
Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012;
Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810.

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

M ORE INFORMATION
For more information, please contact W. Arthur Tribble at (214) 922-6226. For
additional copies of this Bank’s notice, contact the Public Affairs Department at (214) 922-5254.
Sincerely yours,

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
FEDERAL DEPOSIT INSURANCE CORPORATION
OFFICE OF THE COMPTROLLER OF THE CURRENCY
OFFICE OF THRIFT SUPERVISION

INTERAGENCY STATEMENT
BRANCH NAMES
May 1, 1998

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance
Corporation, the Office of the Comptroller of the Currency and the Office of Thrift
Supervision (the "Agencies") are issuing this Interagency Statement regarding the practice of
insured depository institutions operating branches under different trade names in response to
requests for guidance to some of the Agencies. While there are no federal laws or regulations
that specifically require that all branches of an insured depository institution operate under a
single name,1 the Agencies are concerned that if customers believe they are dealing with two
different institutions, they may inadvertently exceed FDIC insurance limits by depositing
excess amounts in different branches of the same institution. The Agencies believe it is
important that customers understand the scope of FDIC insurance in these circumstances.2
Accordingly, an insured depository institution that intends to use a different name for a branch
or other facility should take reasonable steps to ensure that customers will not become
confused and believe that its facilities are separate institutions or that deposits in the different
facilities are separately insured.3 Such measures may include, but are not limited to:
1 There may be state laws that need to be considered with respect to operating under a
trade name. In addition, regulations applicable to insured institutions that may be promulgated
by the Board of Governors of the Federal Reserve System or the Office of Thrift Supervision
(as applicable) under the Federal Trade Commission Act, 15 U.S.C. § 57a(f) et. seq.,
regarding the prevention of unfair or deceptive acts or practices, could apply to the use of
branch names.
2 Generally, each depositor at an insured depository institution is insured up to
$100,000. See 12 U.S.C. §§ 1813(m), 1817(i), and 1821(a). Insured deposit limits are
determined in accordance with regulations prescribed by the FDIC at 12 C.F.R. Part 330.
3 The practice of insured depository institutions using different trade names over a
computer network such as the Internet raises the same concern discussed herein. Accordingly,
institutions intending to use different trade names over a computer network should take
reasonable steps to ensure that customers will not be confused about either the identity of the
insured depository institution or the extent of FDIC insurance coverage.

1) Disclosing, clearly and conspicuously, in signs, advertising, and similar materials
that the facility is a branch, division, or other unit of the insured institution. The
institution should exercise care that the signs and advertising do not create a deceptive
and/or misleading impression.
2) Using the legal name4 of the insured institution for legal documents,
certificates of deposit, signature cards, loan agreements, account statements,
checks, drafts, and other similar documents.
3) Educating the staff of the insured depository institution regarding the
possibility of customer confusion with respect to deposit insurance. The
Agencies recommend that the insured depository institution instruct staff at the
branch and any other facilities operating under trade names to inquire of
customers, prior to opening new accounts, whether they have deposits at the
depository institution's other facilities or branches. In addition, during the time
period soon after one institution acquires or combines with another, staff should
be reminded to call customers' attention to disclosures that identify a particular
branch or facility as part of an institution.
4) Obtaining from depositors opening new accounts at the branch a signed
statement acknowledging that they are aware that the branch and other facilities
are in fact parts of the same insured institution and that deposits held at each
facility are not separately insured.

EFFECTIVE DATE: July 1, 1998

4
The legal name of an insured institution is its full name as reflected in its charter,
except that an insured institution may abbreviate terms that are indicators of corporate status
(e.g., N.A., F.S.B., Inc., Corp.).

2

/s/

/s/
Richard Spillenkothen
Director, Division of Banking
Supervision and Regulation
Board of Governors of the Federal Reserve System

/s/

Nicholas J. Ketcha, Jr.
Director, Division of Supervision
Federal Deposit Insurance Corporation

Is/

Leann G. Britton
Senior Deputy Comptroller
Bank Supervision Operations
Office of the Comptroller of the Currency

3

John C. Price, Jr.
Director, Supervision Policy
Office of Thrift Supervision


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102