6.2.2.1 Insurance after Mergers and Restructuring
During restructuring, such as mergers, the FDIC has a six months grace period in recognizing the financial institution for insurance calculations. If two depository institutions, whether insured entities or separately insured branch and entities (in the case of US branches of foreign banks), merge or go through an acquisition, the deposit treatment for these institutions are as follows:
- If the restructuring occurred less than or equal to 6 months from the As of Date: Treat the two entities as separate entities and compute the deposit insurance for the accounts held by them separately.
- If the restructuring occurred greater than 6 months from the As of Date:
- If there are term deposits whose maturity are is greater than 6 months from the restructuring date and are not renewed within 6 months, then the application treats them separately from the acquiring entity for deposit insurance calculation purposes till the maturity of such deposits.
- If there are term deposits that are renewed within 6 months of the restructuring on identical terms as the original terms, the application treats them separately from the acquiring entity for deposit insurance calculation purposes till the first maturity.