Regulatory Alerts2024-08-09 | 2024-17351Clarification of Deposit Insurance Coverage for Legacy Branches of U.S. Banks in the Federated States of Micronesia, the Marshall Islands, and Palau
The Federal Deposit Insurance Corporation issued an interim final rule amending 12 CFR Part 330 to clarify that deposits in legacy branches of U.S. insured depository institutions operating in the Federated States of Micronesia, the Marshall Islands, and Palau are eligible for FDIC deposit insurance. By statutorily treating these legacy branches as domestic offices rather than foreign ones, the regulation ensures that their dually payable deposits qualify for coverage without balance or account-age restrictions. The amendment explicitly preserves existing insurance for locally chartered Freely Associated State banks while limiting this domestic-branch exception to U.S. bank branches operating in those territories as of the rule’s effective date.