A Deep Dive into FDIC Part 370 Compliance: Lessons Learned and Best Practices for Large Banks

The introduction of the FDIC’s 12 CFR Part 370 regulation has marked a significant turning point for the nation’s largest banks. Affecting 38 of the largest U.S. financial institutions, this regulation requires banks with more than two million deposit accounts to demonstrate the ability to calculate insured and uninsured deposit amounts for each depositor within 24 hours of a bank’s failure. The stakes are high: compliance is not only a regulatory mandate but also a critical component of depositor trust and systemic stability. As the compliance deadline has passed and early implementations have matured, several key lessons and best practices have emerged—offering a roadmap for banks still navigating this complex journey.

Understanding the Challenge: Data, Complexity, and Cost

FDIC Part 370 compliance is a multifaceted challenge. At its core, the regulation demands a robust, accurate, and rapid insurance determination system—one that can process vast volumes of depositor data, account for thousands of insurance scenarios, and integrate seamlessly with legacy banking systems. The cost of compliance has been significant, with industry estimates exceeding $500 million for data cleanup and system development across the affected institutions. For many banks, the journey has revealed three primary challenges:

Data Quality and Integration: Decades of mergers, acquisitions, and siloed IT investments have left many banks with fragmented, inconsistent depositor data. Cleaning, standardizing, and integrating this data is often the most time-consuming and resource-intensive aspect of compliance.
System Complexity: Building or integrating an insurance determination engine that can handle the full spectrum of FDIC insurance rules—across personal, business, trust, and retirement accounts—requires deep domain expertise and advanced technology.
Project Delivery and Change Management: Coordinating cross-functional teams, aligning business and IT priorities, and managing regulatory scrutiny all add layers of complexity to the compliance effort.

Lessons Learned from Early Implementations

Having supported the majority of the 38 affected institutions, several practical lessons have emerged from early compliance programs:

Start with a Data-First Mindset: Successful banks prioritized data quality from the outset, investing in comprehensive data audits and remediation before tackling system development. This approach reduced downstream rework and enabled more accurate insurance calculations.
Leverage Domain Expertise: The complexity of FDIC insurance rules cannot be overstated. Banks that partnered with specialists—combining regulatory, technology, and project delivery expertise—were able to accelerate solution design and avoid costly missteps.
Adopt Agile, Iterative Delivery: Given the evolving nature of regulatory guidance and the intricacies of legacy systems, agile methodologies proved invaluable. Iterative development allowed teams to test, learn, and adapt quickly, ensuring compliance without sacrificing operational stability.
Invest in Automation: Automation, including robotic process automation (RPA), played a key role in streamlining data validation, exception management, and reporting. This not only reduced manual effort but also improved accuracy and auditability.
Plan for Ongoing Maintenance: Compliance is not a one-time event. Banks that established clear processes for ongoing data quality monitoring, system updates, and regulatory change management are better positioned for sustained compliance.

Best Practices for Efficient, Sustainable Compliance

Drawing on these lessons, several best practices have crystallized for large banks seeking to achieve and maintain FDIC Part 370 compliance:

1. Comprehensive Data Governance

Establish a robust data governance framework that spans all depositor data sources. This includes clear data ownership, standardized definitions, and automated quality controls. Regular data audits and remediation cycles should be embedded into business-as-usual operations.

2. Modular, Scalable Technology Solutions

Rather than custom-building from scratch, many banks have benefited from leveraging proven, third-party solutions that encapsulate FDIC insurance logic and can be integrated with existing core systems. Modular architectures allow for easier updates as regulations evolve and business needs change.

3. Cross-Functional Collaboration

FDIC Part 370 compliance is not just an IT project—it requires close collaboration between compliance, risk, operations, and technology teams. Early and ongoing stakeholder engagement ensures alignment, accelerates decision-making, and reduces the risk of project delays.

4. Agile Project Management

Adopt agile delivery practices to manage complexity and respond to changing requirements. Short, iterative sprints with regular stakeholder reviews help surface issues early and keep the program on track.

5. Continuous Improvement and Regulatory Readiness

Establish mechanisms for ongoing monitoring, testing, and improvement. This includes regular scenario testing, system health checks, and readiness drills to ensure the bank can meet the 24-hour insurance determination requirement at any time.

The Role of Strategic Partnerships

The scale and complexity of FDIC Part 370 compliance have underscored the value of strategic partnerships. By combining deep regulatory expertise, advanced technology platforms, and proven project delivery capabilities, banks can reduce compliance risk, control costs, and accelerate time to value. For example, partnerships that bring together domain experts with experience in FDIC insurance engines and digital transformation specialists have enabled banks to deploy comprehensive, auditable solutions that stand up to regulatory scrutiny.

Looking Ahead: Compliance as a Catalyst for Transformation

While FDIC Part 370 compliance is a regulatory necessity, it also presents an opportunity for broader digital transformation. The investments made in data quality, automation, and agile delivery can serve as a foundation for future innovation—enabling banks to respond more quickly to new regulations, launch new products, and deliver better customer experiences.

As the regulatory landscape continues to evolve, large banks that embrace these lessons and best practices will not only achieve compliance more efficiently but also position themselves for long-term success in a rapidly changing industry.

Ready to accelerate your compliance journey? Connect with Publicis Sapient’s regulatory transformation experts to learn how our experience with the majority of the nation’s largest banks can help you achieve FDIC Part 370 compliance—and unlock new value for your institution.