Keeping Deposits Local Act
Last recorded step: House, May 21, 2026.
Nothing scheduled on the calendars we hold.
This bill would increase the amount of reciprocal deposits banks can accept and expand the eligibility criteria for institutions to do so.
This summary may be out of date
Last regenerated The bill has had legislative action since.
What it does
This bill would increase the amount of reciprocal deposits that insured financial institutions are permitted to accept by establishing a tiered system based on an institution's total liabilities. It also proposes to expand the eligibility criteria for institutions to accept these deposits by allowing those with a CAMELS rating of 1, 2, or 3 to qualify. These changes would modify how banks use reciprocal networks to split large deposits and increase the availability of deposit insurance for their customers.
Who is affected
This bill affects insured depository institutions that utilize reciprocal networks to split large deposits and increase insurance coverage for their customers. It specifically impacts financial institutions with CAMELS ratings of 1, 2, or 3 by allowing them to qualify to accept these deposits. Additionally, the bill affects institutions with varying levels of total liabilities by establishing a tiered system for the amount of reciprocal deposits they may accept.
Key provisions
- Increase in reciprocal deposit limits. The bill raises the maximum amount of reciprocal deposits that insured depository institutions are permitted to accept.
- Establishment of a tiered liability system. A new tiered system is created to determine the allowable amount of reciprocal deposits based on an institution's total liabilities.
- Expansion of eligibility based on CAMELS ratings. The bill modifies qualification requirements to allow institutions with a 1, 2, or 3 rating under the CAMELS scale to accept reciprocal deposits, expanding beyond the current 'outstanding' or 'good' composite rating standards.
Fiscal impact
Not applicable: No CBO cost estimate available
Effective dates
Not applicable: Official Summary does not address effective dates
Relationship to existing law
The bill modifies existing regulations governing reciprocal deposits by increasing the amount insured depository institutions may accept and establishing a tiered system based on total liabilities. It also expands the eligibility criteria for these institutions by replacing current rating requirements with a broader qualification based on the CAMELS scale.
Stated purpose
The bill aims to expand the ability of insured depository institutions to accept reciprocal deposits by increasing allowable limits based on total liabilities and broadening the eligibility criteria for institutions to participate in reciprocal networks.