Regulatory

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On May 31, the Federal Deposit Insurance Corporation (FDIC) released its First Quarter 2023 Quarterly Banking Profile showing a first quarter aggregate net income of $79.8 billion for its 4,672 insured commercial banks and savings institutions, an increase of $11.5 billion from fourth quarter 2022. In a statement accompanying the release of the Profile, FDIC Chairman Martin Gruenberg stated: “Despite the recent period of stress, the banking industry has proven to be quite resilient. Net income still remains high by historical measures even after deducting one-time transactions, asset quality metrics are favorable, and the industry remains well capitalized.” Chairman Gruenberg did acknowledge, however, that these results include only a few weeks of the banking stress that began in early March. The more lasting effects of recent bank failures may not be fully apparent until after the second quarter.

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On May 23, Chairman Martin J. Gruenberg of the Federal Deposit Insurance Corporation (FDIC) delivered remarks at the Cities for Financial Empowerment Fund 2023 Bank On National Conference. One of the focuses of the Chairman’s remarks was on entities that misrepresent the availability of deposit insurance. ”[S]ince 2022, the FDIC has taken action against more than 85 entities that were misrepresenting the nature, extent, or availability of deposit insurance. In some instances, these firms had made misleading claims in connection with crypto assets while others had apparently developed fraudulent websites to trick consumers into believing they were doing business with a bank.”

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Today, the Federal Deposit Insurance Corporation (FDIC) published a notice of proposed rulemaking that would impose special assessments to recover losses to the Deposit Insurance Fund (DIF) arising from the FDIC’s protection of uninsured depositors in the wake of the two significant bank closings in March 2023. The Federal Deposit Insurance Act requires the FDIC to recover any losses to the DIF as a result of protecting uninsured depositors through a special assessment. The law also provides the FDIC authority to consider the types of entities that benefited the most from the assistance provided.

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On May 3, the Securities and Exchange Commission (SEC) adopted rule amendments regarding disclosures about repurchases of an issuer’s equity securities, or issuer stock buybacks. The final rule and fact sheet can be found here and here. The new rules include:

  • Disclosure by issuers of daily quantitative share repurchase information, either quarterly or semi-annually;
  • Inclusion of a checkbox indicating whether certain officers and directors traded in the relevant securities in the four business days before or after the announcement of the repurchase plan or program;
  • For each day on which a purchase was made, the number of shares repurchased and the average price, among other disclosures; and
  • Disclosures tagged using Inline XBRL.
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RICHMOND, Va. – Troutman Pepper client Burke & Herbert Financial Services Corp. (Nasdaq: BHRB), the bank holding company for Burke & Herbert Bank & Trust Company, has begun trading its common stock on the Nasdaq Capital Market® after completing a registration process with the United States Securities and Exchange Commission (SEC). Shares of the company’s common stock will continue to trade under the symbol “BHRB”, the same symbol under which the company’s securities were previously quoted on OTC Markets. Read a company press release about the listing.

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Reilly Is 3rd Partner to Join the National Practice This Year

WASHINGTON – Joseph “Joe” Reilly, an experienced attorney who advises financial services companies in a wide variety of regulatory, enforcement, and compliance matters, has joined Troutman Pepper’s nationally recognized Consumer Financial Services Practice Group as a partner. He most recently practiced at Manatt, Phelps & Phillips, LLP.