ILC-Parent Support Obligations
Setting the stage for new charters and legislative battles in 2021, the FDIC has finalized a controversial proposal1 addressing source-of-support and certain other obligations for the parent companies of some industrial banks and industrial loan companies (ILCs). While these formalize and to some extent increase standards now applied to nonbank parents, the new requirements nonetheless are far less binding than the obligations imposed on bank holding company parents of banks that compete head on with these ILCs.