Independent Community Bankers of America, Michael Emancipator

Via Electronic Submission

May 24, 2021

James P. Sheesley

Assistant Executive Secretary

Attention: Comments-RIN 3064-ZA14

Federal Deposit Insurance Corporation

550 17

Street, NW

Washington, DC 20429

RE: Request for Information on FDIC Official Sign and Advertising Requirements and Potential

Technological Solutions - RIN 3064-ZA14

Dear Mr. Sheesley:

The Independent Community Bankers of America (“ICBA”)

welcomes the opportunity to

comment on the Federal Deposit Insurance Corporation’s (“FDIC”) Request for Information

(“RFI”), which seeks input on how the FDIC could revise and clarify its official FDIC deposit

insurance sign and advertising rules (“advertising rules”).

Background

The FDIC is issuing this RFI as a means to inform and assess whether its current advertising rules

adequately respond to and allow for recent advances in the marketplace, and whether they will

sufficiently account for future advances, whatever they may be. The FDI Act requires that

insured depository institutions display a sign relating to the insurance of deposits at each place

of business maintained by that institution in accordance with regulations issued by the FDIC.

The Independent Community Bankers of America® creates and promotes an environment where community banks

flourish. ICBA is dedicated exclusively to representing the interests of the community banking industry and its

membership through effective advocacy, best-in-class education, and high-quality products and services.

With nearly 50,000 locations nationwide, community banks constitute 99 percent of all banks, employ more than

700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding more than $5

trillion in assets, over $4.4 trillion in deposits, and more than $3.4 trillion in loans to consumers, small businesses

and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods

they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities

throughout America. For more information, visit ICBA’s website at www.icba.org..

The FDIC is seeking comment on how consumers connect with banks today, and how

technological solutions could better help customers distinguish FDIC-insured banks from

nonbanks.

ICBA Comments and Response to Questions

Customers’ relationships and interactions with banks have evolved substantially since 2006, the

last time FDIC revised its advertising rules. In addition to traditional advertising media, such as

television and radio, community banks increasingly advertise their products and services using

newer channels, such as email, text, and social media. These are channels and methods that

were either nascent or non-existent when the FDIC last revised its advertising rules, and thus,

unaddressed. Given that FDIC’s current advertising rules hinge on the customer’s physical

presence and interaction with a bank,

FDIC’s attention to this matter is timely.

In fact, as FDIC rightly notes in the RFI, many bank depositors never physically interact with

their bank, or in some cases, do not even have a physical branch to visit. Instead, many

depositors prefer to interact with their bank via digital channels, using remote deposit capture,

online bill pay, or money transfer applications.

Should the rule continue to require the sign be a minimum size and a specific color? Is this

needed to ensure consumers understand “deposit insurance?” (Question 1)

ICBA is not aware of a situation where the physical attributes of signage need to be revised.

Current standards for placards, stickers, and other notifications for physical channels continue

to meet the need of informing the depositor. There is significant trust that depositors place in

FDIC signage, and ICBA believes that FDIC signage is a benefit that banks are proud to display.

Does the rule's definition of “Remote Service Facility” appropriately reflect current banking

practices? For example, should the list of facilities (any automated teller machine, cash

dispensing machine, point-of-sale terminal, or other remote electronic facility where deposits

are received) be broadened? If so, what other “facilities” should be included? (Question 5)

The current definition of “Remote Service Facility” appears to adequately cover the various

channels of physical deposit-taking. FDIC should continue to make this provision permissive and

12 CFR Part 328 (requiring banks to continuously display the FDIC sign where insured deposits are usually and

normally received in the bank's principal place of business and at all of its branches and to use an official

advertising statement, such as “Member FDIC,” when advertising deposit products and services).

not a requirement, though ICBA believes that banks would proudly display FDIC signage,

regardless.

Are FDIC-insured institutions currently displaying a digital representation of the FDIC sign or

logo on their websites/mobile apps at account opening? If not, should they do so? (Question

6). Are FDIC-insured institutions currently displaying a digital representation of the FDIC sign

or logo on their websites/mobile apps each time a consumer deposits funds? If not, should

they do so? (Question 7)

ICBA is not aware of instances where community banks opt not to digitally display a FDIC sign or

logo on websites/mobile applications. However, ICBA does not believe that FDIC should create

an explicit requirement for banks to do so. Just as FDIC permits banks to post physical signage

at Remote Service Facilities, FDIC should treat digital signage in a similarly permissive manner.

For example, there may be circumstances where a bank might not be able to display the digital

sign on phone screens while still providing an accessible user experience. However, as stated

above, ICBA believes that banks view FDIC insurance as a differentiator from nonbanks and as

something that is worth displaying when possible. This is a strong incentive for banks to display

digital signage without creating new requirements.

As noted above, the current regulation requires that the official FDIC sign be displayed

continuously at each station or window where insured deposits are usually and normally

received in the depository institution's principal place of business and at all of its branches.

Should the rule continue to require that the sign be displayed continuously, or should it allow

for digital displays or representations that are not continuously displayed? (Question 9)

ICBA believes that providing additional permissibility will allow banks to choose which options

work best for their physical locations. As stated above, banks are strongly incentivized to

display their FDIC-coverage as a way to differentiate themselves from nonbanks and providing

additional flexibility could benefit banks that wish to further highlight that difference.

How do banks currently provide the advertising statement when promoting deposit products

through non-traditional channels? (Question 12)

Some banks have formed relationships with nonbanks, such as fintechs, where the nonbank is

the predominant channel for interaction with the consumer, but where the bank provides back-

end services for the fintech. This is known as ‘banking-as-a-service’ (“BaaS”), and sometimes

includes providing deposit insurance for customers of the nonbank. Often, these relationships

are referenced via boilerplate disclosures or footnotes on the nonbank’s website, application,

or other channel where the consumer interacts.

If a bank is identified in a nonbank's promotion or advertisement for a deposit product or

service, should the advertising statement be required, or conversely, should it be prohibited

given that the advertisement is from an uninsured entity? (Question 13)

Again, ICBA believes that FDIC coverage of deposits is a benefit, and as such, nonbanks will be

incentivized to promote their relationships with insured-banks. While ICBA believes that BaaS

signage guidance could provide bright-line usage for BaaS banks, we recommend that FDIC

work with state regulators to ensure that nonbanks are not using FDIC signage to deceive

consumers as to the status of their deposits or other products, as FDIC does not necessarily

have jurisdiction or authority over those entities.

What technological options or other approaches could be utilized to allow consumers to

distinguish FDIC-insured banks and savings associations from nonbanks across web and

digital channels? What are the benefits and drawbacks of each approach? Is it necessary or

desirable for the FDIC to try to “solve” this by rule, or can private sector initiatives better

address this issue? (Question 15)

ICBA fully supports the Internet Corporation for Assigned Names and Numbers (“ICANN”)

“.BANK” initiative with fTLD to provide banks with domains that include enhanced security

requirements to protect institutions and their customers.

All applicants undergo a thorough

verification process before being awarded a domain and must comply with strict registry

policies ensuring ongoing compliance with the fTLD security requirements. To become a .BANK

Registrant, an organization must be one of the following government regulated entities: retail

bank, savings association, national retail bank, or holding or parent company of a retail bank or

savings association. This could be a viable option for consumers to easily differentiate between

insured banks and nonbank fintechs.

In conclusion, ICBA appreciates the FDIC’s exploration of whether current signage and

advertising requirements have kept pace with the way that depositors interact with banks and

nonbanks. Technological advancements have certainly increased consumer access to insured

banks and the FDIC is taking prudent steps to ensure that depositors continue to be informed

The .BANK TLD is operated by fTLD Registry Services, LLC—a coalition of banks, insurance companies and financial

services trade associations from around the world—which ensures it is governed in the best interests of banks and

insurance companies and their customers. fTLD’s mission is to operate a trusted, verified, more secure and easily-

identifiable online location for these financial companies and their customers.

and protected. Should you wish to discuss these comments further, please do not hesitate to

contact me at [email protected] or 202-659-8111.

Sincerely,

Michael Emancipator

Vice President and Regulatory Counsel