Skip to content
GeoDataVision
Learn More - Click Here!

Thread Options
#1017164 - 08/11/08 07:16 PM Dividend limitations
complyok Offline
New Poster
Joined: Aug 2006
Posts: 15
OK
What are the FDIC limitations on bank dividends? I know that the OCC (and OTS?) have a formula that dividends are limited to the last two years of earnings or something like that. Does the FDIC have a similar rule?

Return to Top
Operations Compliance
#1019673 - 08/14/08 12:23 AM Re: Dividend limitations complyok
Jokerman Offline
10K Club
Joined: Nov 2003
Posts: 12,846
I am unaware of any general limitations, so long as you aren't restricted from doing so and are maintaining a well-capitalized status.

Return to Top
#1020049 - 08/14/08 03:20 PM Re: Dividend limitations complyok
KYAuditor Offline
100 Club
KYAuditor
Joined: Jan 2003
Posts: 138
Kentucky
You may pay dividends on current year earnings and any undistributed earnings from the prior two years. If you want to pay dividends in excess of this amount, you can request permission from FDIC. Provided that you are well-capitalized, they will probably approve the dividends.
_________________________
Just my 2 cents worth--for what its worth!!

Return to Top
#1020669 - 08/14/08 09:10 PM Re: Dividend limitations KYAuditor
Jokerman Offline
10K Club
Joined: Nov 2003
Posts: 12,846
Do you have a link, KYAuditor? (Not disputing, just haven't heard this.)

Return to Top
#1020890 - 08/15/08 01:05 PM Re: Dividend limitations Jokerman
KYAuditor Offline
100 Club
KYAuditor
Joined: Jan 2003
Posts: 138
Kentucky
I'm not having any luck pasting the link, but look under Reg H. The cite is 12 CFR 208.5(c). This applies to state nonmember banks so maybe that is why you hadn't heard of it.
_________________________
Just my 2 cents worth--for what its worth!!

Return to Top
#1020954 - 08/15/08 02:03 PM Re: Dividend limitations KYAuditor
Jokerman Offline
10K Club
Joined: Nov 2003
Posts: 12,846
Thanks.

Return to Top
#1021500 - 08/15/08 07:38 PM Re: Dividend limitations Jokerman
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,684
Cape Cod
http://www.bankersonline.com/regs/208/208-5.html

Actually, it applies to state member (not non-member) banks.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1021524 - 08/15/08 07:46 PM Re: Dividend limitations John Burnett
John Burnett Offline
10K Club
John Burnett
Joined: Oct 2000
Posts: 39,684
Cape Cod
Take a look at Table 1 to Appendix A to Part 363 of the FDIC's Rules and Regulations. It's a table of citations on laws and regulations on insider lending and dividend restrictions, and it has columns for national banks, state member banks, state non-member banks, and Savings Associations.

Click HERE and then do an in-page search (Ctrl+F) for "Table 1" a couple of times.
_________________________
John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

Return to Top
#1021747 - 08/16/08 05:17 PM Re: Dividend limitations John Burnett
Jokerman Offline
10K Club
Joined: Nov 2003
Posts: 12,846
Thanks, John.

Return to Top

Moderator:  Andy_Z, John Burnett