Banking Agencies Issue Host State Loan-to-Deposit Ratios
June 26, 2008
Circular No. 11964

The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency have issued the host state loan-to-deposit ratios that the banking agencies will use to determine compliance with section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994.  These ratios update data released on June 12, 2007.

In general, section 109 prohibits a bank from establishing or acquiring a branch or branches outside of its home state primarily for the purpose of deposit production.  Section 109 also prohibits branches of banks controlled by out-of-state bank holding companies from operating primarily for the purpose of deposit production.

A bank that is in violation of section 109 is subject to sanctions by the appropriate banking agency.

See the press release for full details.

Press release offsite