Today, the Federal Deposit Insurance Corporation (FDIC) issued a letter to financial institutions (FIL-37-2023) regarding the proper way to report estimated uninsured deposits in accordance with the instructions to the Consolidated Reports of Condition and Income (Call Report). FIL-37-2023 does not impact institutions with less than $1 billion in total assets that do not report estimated uninsured deposits.

According to the FDIC, it has observed some institutions incorrectly reducing the amount of uninsured deposits reported to the extent that the deposits are collateralized by pledged assets. Instead, the FDIC advises that if an institution has deposit accounts with balances in excess of the federal deposit insurance limit that it has collateralized by pledging assets, such as deposits of the U.S. Government and various states and political subdivisions, the institution should make a reasonable estimate of the portion of these deposits that is uninsured.

The FDIC has also purportedly observed some institutions reducing the amount reported on Schedule RC-O (Other Data for Deposit Insurance Assessment) by excluding intercompany deposit balances of subsidiaries. The FDIC advises that all deposits of subsidiaries (except an insured depository institution subsidiary that is accounted for under the equity method of accounting instead of consolidating) that are consolidated and, therefore, eliminated from reported deposits on the balance sheet, must be reported in Schedule RC-O, items 1 through 3, Memorandum item 1, and, if applicable, Memorandum item 2, estimated amount of uninsured deposits.

Because financial institutions are responsible for the accuracy of their Call Report data (and for filing amendments as necessary to ensure accuracy), the FDIC has instructed financial institutions with incorrectly reported uninsured deposit data to amend previously-filed Call Reports. If your financial institution incorrectly reduced the amount of reported uninsured deposits (including, but not limited to, for reasons related to collateralization of deposits by pledged assets or exclusion of intercompany deposit balances of subsidiaries), those reports are inaccurate and, accordingly, should be amended and resubmitted to the Central Data Repository. Financial institutions can amend and resubmit Call Reports going back three years from the present quarter (or more, if appropriate). The Call Report forms and instructions can be accessed here. The forms and instructions are also available from the Federal Financial Institutions Examination Council’s (FFIEC’s) Reporting Forms webpage.