Agencies publish host state loan-to-deposit ratios

Section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act generally prohibits banks from establishing or acquiring out-of-state branches primarily for deposit production.

This rule was expanded by the Gramm-Leach-Bliley Act of 1999 to include branches of banks controlled by out-of-state bank holding companies.

To ensure compliance, the appropriate agency compares a bank's estimated statewide loan-to-deposit ratio to the published host state ratio for a specific state.

If a bank's ratio is at least half of the host state ratio, it is deemed compliant.

This initial step provides a clear, quantitative benchmark for regulatory assessment.

Should a bank's statewide loan-to-deposit ratio fall below one-half of the host state ratio, or if data is unavailable for the first step, a second assessment is conducted.

This involves determining if the bank is reasonably helping to meet the credit needs of the communities served by its interstate branches.

Banks failing both steps face sanctions.

The agencies calculated the host state ratios using data from Consolidated Reports of Condition and Income and Summary of Deposits Surveys as of June 30, 2025.

Certain institutions, such as wholesale, limited purpose, credit card, and special purpose banks, were excluded from the calculation due to their unique business models that do not involve traditional deposit-taking or lending activities.