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FINANCIAL INSTITUTION LETTER | AUGUST 9, 2024 |
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Classification of Interactive Teller Machines as Domestic Branches or Remote Service Units
SUMMARY:
Statutory Background:
Section 18(d) of the Federal Deposit Insurance Act (FDI Act) (12 U.S.C. § 1828(d)) requires a state nonmember bank to obtain the FDIC’s consent before establishing a domestic branch. Section 3(o) of the FDI Act (12 U.S.C. § 1813(o)) specifically excludes automated teller machines (ATMs) and remote service units (RSUs) from the definition of domestic branch.
Recent Developments Regarding Interactive Teller Machines:
Interactive Teller Machine (ITM) technology has become increasingly sophisticated in recent years. State nonmember banks have sought guidance from the FDIC regarding whether the proposed use of an ITM at a location other than an established branch facility would require the filing of a domestic branch application, or would qualify for the RSU exclusion to the definition of domestic branch (meaning no branch application would be necessary). ITMs generally resemble automated teller machines but allow customers to interact with live tellers to complete a variety of banking transactions.
STATEMENT OF APPLICABILITY:
The contents of, and material referenced in, this FIL apply to all FDIC-supervised state nonmember banks.
DISTRIBUTION:
Insured depository institutions with $50 billion or more in total assets.
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