April 30, 2010
New Q&As: FDIC’s Policy Statement for Failed Bank Acquisitions
Here is news culled from this Davis Polk memo:
Last Friday, the FDIC issued new Q&As that clarify certain aspects of its Statement of Policy on Failed Bank Acquisitions, but leave the contours of the Policy Statement largely intact.
While there are still ambiguities in the Policy Statement, it is fair to say that the FDIC is signaling a practical way forward for private investors to enter the queue for failed institutions. The April Q&As provide clarity about the so-called “one-third test,” requirements for offshore investors, information requirements applicable to non-Policy Statement investors and the application of the Policy Statement to recapitalization transactions. It will remain extremely important for private investors to engage the FDIC staff, as every transaction will inevitably require some degree of judgment and discretion on the part of the FDIC on a variety of supervisory issues, including the Policy Statement.