Sponsors (12)
The bill provides clearer rules and preserves liquidity and predictable treatment for many banks (and potential benefits for public entities) but increases risks of concentration and systemic exposure while imposing study and potential compliance costs that may disadvantage smaller banks and leave gaps about end‑user effects.
Banks, regulators, and Congress get clearer, more predictable rules and a six‑month data study—reducing regulatory uncertainty about reciprocal/brokered deposits and guiding future policy.
Insured depository institutions rated CAMELS 1–3 (and qualifying agent institutions) can continue to serve as agents for reciprocal deposits, preserving access to liquidity and deposit distribution services.
Agent institutions can treat a larger, predictable portion of reciprocal deposits as non‑brokered under explicit caps/brackets, easing liquidity management and stable funding planning for those institutions.
Taxpayers and bank customers could face higher systemic risk because treating more reciprocal deposits as core funding (rather than brokered) may weaken safeguards against fragile funding runs.
Smaller and regional banks (and customers they serve) may be disadvantaged as deposit flows concentrate to higher‑rated or agent institutions, increasing competitive pressure and potentially harming local lending.
Some institutions that previously qualified may lose agent status if their most recent CAMELS rating exceeds 3, reducing those banks' ability to access reciprocal/brokered deposit services.
Based on analysis of 4 sections of legislative text.
Sets tiered percentage caps on reciprocal-deposit exclusions from brokered-deposit rules, ties agent eligibility to the latest CAMELS 1–3 exam result, and mandates an FDIC study.
Introduced May 7, 2025 by Thomas Earl Emmer · Last progress May 20, 2026
Rewrites how certain reciprocal deposits are treated for the brokered-deposit rules by specifying percentage-based exclusions tied to an institution’s total liabilities across three dollar tiers, and narrows which banks qualify as agent institutions by tying eligibility to their most recent section 10(d) CAMELS exam rating (ratings 1–3). It also directs the FDIC, working with the Federal Reserve, to study the use and risks of reciprocal deposits since 2018 and report findings to Congress within six months of enactment.