This bill changes when federal banking agencies can use concentration-limit exceptions for mergers or acquisitions that involve a failed bank or a bank in danger of failing. Agencies must find, with clear and convincing evidence, that the deal is necessary to prevent significant economic disruption or serious harm to financial stability before using the exception. The bill defines what counts as a "qualified bid" (a bidder that is well capitalized and well managed and would leave the merged bank well capitalized). It adds matching requirements to parts of the Federal Deposit Insurance Act and the Bank Holding Company Act, and limits certain concentration-limit waivers unless no qualified bid exists. The bill also requires agencies to report to Congress within 30 days when they waive such limits. Reports must explain the waiver, describe alternative bids considered, explain why alternatives were not chosen, and suggest ways to improve competition. The reports must be posted publicly, with allowed redactions. Finally, the bill prevents the FDIC from counting bids as part of a "least costly" resolution if the bids would violate the concentration-limit prohibitions identified in the bill.
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The bill requires stronger proof and clearer rules before agencies waive concentration limits for deals involving failing banks. It defines qualified bidders and asks agencies to look for competitive alternatives. It also adds reporting and public disclosure to increase transparency and to collect recommendations for improving future resolutions.
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