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FDIC Deposit Insurance and DIF Recapitalization

>> Policy Overview

FDIC Emergency Special Assessment | FDIC Recapitalization Plan | Other Deposit Insurance Issues | Consumer Information

Deposit insurance plays a crucial role in our financial system, and ABA is committed to rebuilding the FDIC insurance fund to preserve public confidence in banks. ABA has been actively engaged on issues surrounding FDIC's recapitalization plans and supports fair and conservative premium increases. By slowly rebuilding the fund, FDIC can ensure that excess premiums will not take resources out of banks' communities at the very time in the economic cycle when credit availability is so critical to recovery.

FDIC Emergency Special Assessment

On Feb. 27, FDIC proposed an emergency special assessment of 20 basis points on all banks to restore the Deposit Insurance Fund to an acceptable level. The assessment, which will be payable on Sept. 30, is in addition to a planned increase in premiums and a change in the way regular premiums are assessed.

ABA, state bankers associations and member bankers have objected vociferously to the special assessment, which is unworkable and would dramatically reduce banks' ability to lend just when bank loans are needed the most.

ABA and the state associations have led the effort to put additional options for recapitalizing the DIF on the table, engaging in extensive conversations with FDIC Chairman Sheila Bair and others. As a result of this advocacy, Bair announced March 2 that the agency would cut its special assessment if Congress passes legislation increasing the agency's line of credit with Treasury. ABA is backing such legislation and working to see it passed. An ABA-state association task force also has worked to develop additional alternatives that would reduce the special premium's burden.

FDIC Recapitalization Plan

Other Deposit Insurance Issues

Consumer Information on Deposit Insurance

Questions? Contact Rob Strand for more information.