Maryland Access to Banking Act - Financial Regulation
Last reviewed/updated: July 18, 2023
About the Maryland Access to Banking Act
Governor Wes Moore signed the Maryland Access to Banking Act into law on May 8, 2023. As part of Governor Moore’s pledge to “Leave No One Behind”, the Act promotes the growth of financial services in low-to-moderate income (LMI) communities. The Act aims to achieve this by:
- Offering an assessment credit to Maryland state-chartered banks and credit unions that operate branches in LMI communities; and
- Establishing a venture fund to invest in financial innovations that develop opportunities for banking institutions and credit unions to better serve the needs of LMI communities.
The Act tasks the Office of Financial Regulation (OFR) with developing and utilizing these initiatives to strengthen financial resources for all Marylanders.
For more information and to read the text of the Act, visit the Maryland General Assembly’s website.
Maryland state-chartered banks and credit unions are assessed an annual fee to cover the expenses of regulating the industry. The assessment is paid into OFR’s Banking Institution and Credit Union Regulation Fund. The Act adjusts the current assessment system for depository institutions by offering an assessment credit to incentivize the establishment of new (de novo) branches and the retaining of existing branches in LMI communities.
- For banks, the assessment credit is $0.06 per $1,000 of deposits on branches currently in LMI communities, for a period of five years, and $0.12 per $1,000 of deposits on de novo branches established in LMI communities.
- For credit unions, the assessment credit is $0.04 per $1,000 of deposits on branches currently existing in LMI communities, for a period of five years, and $0.08 per $1,000 of deposits on de novo branches established in LMI communities.
NOTE: Only banks and credit unions with a composite 1 or 2 CAMELS rating are eligible to earn the assessment credit.
Subscribe to OFR emails for updates on how Maryland state-chartered banks and credit unions may apply for and earn the assessment credit.
Maryland Community Investment Venture Fund
The Act requires OFR to create and seed the Maryland Community Investment Venture (MCIV) Fund. The purpose of the Fund is to invest in tools that will assist Maryland state-chartered banks and credit unions to better serve LMI communities. The MCIV Fund will be guided by several principles, including:
- The MCIV Fund will invest in and partner with financial technology (“fintech”) firms that are developing financial products and innovations that enhance access to capital, funding, and financial services for small businesses in LMI communities.
- When determining where to invest its resources, the MCIV Fund will deploy, test, and evaluate the innovations developed by partner fintechs according to the positive impact on providing capital and funding to small businesses in LMI communities.
- To enhance access to capital, funding, and other financial services in LMI communities, the MCIV Fund will promote and make available to Maryland state-chartered banks and credit unions the innovations developed by the partner fintechs.
The MCIV Fund will be seeded by an initial equity capital investment of up to $2,500,000 from OFR’s Banking Institution and Credit Union Regulation Fund. Through June 30, 2028, the Commissioner of Financial Regulation may match any investment in the MCIV Fund by a Maryland state-charted bank or credit union in the amount of the assessment credit earned by the Maryland state-chartered bank or credit union. All investment returns or return of capital from the MCIV Fund shall be credited to OFR’s Banking Institution and Credit Union Regulation Fund.
If you are a fintech firm interested in accessing resources that will be made available by the MCIV Fund or a Maryland state-chartered depository institution interested in participating in the MCIV Fund, subscribe to OFR emails for updates regarding next steps, eligibility criteria, and the application process.
Stephen J. Clampett
Office of Financial Regulation
Maryland Department of Labor
1100 North Eutaw Street, Suite 611
Baltimore, MD 21201