Small banks want the government to impose stricter data reporting requirements on out-of-state branches to prevent them from draining deposits from local communities.

The federal banking agencies in March proposed requiring banks that branch across state lines to maintain a loan-to-deposit ratio equal to half the average of all banks based in the state. The 1994 interstate banking law mandated a rule be in place by June 1, when full-scale interstate branching will begin in most states.

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