On June 25, 2020, following the OCC’s lead, the Federal Deposit Insurance Corporation’s (FDIC) board of directors voted 3-1 to finalize a rule that reaffirms the “valid when made” doctrine as applicable to loans originated by state-chartered banks and insured branches of foreign banks. The FDIC believes that reaffirmation of a state bank’s ability to assign loans at the contractual interest rate will make state-bank loans more marketable, mitigate the potential for future secondary-market disruption, and maintain parity between national banks and state banks with respect to interest rate exportation.
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