PRESS RELEASE
Federal Deposit Insurance Corporation Each Depositor insured to at least $250,000
November 12, 2009
Media Contact:
Andrew Gray (202) 898-7192
angray@fdic.gov
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-203-2009
FDIC Board Approves Final Rule on Prepaid Assessments
FOR IMMEDIATE RELEASE
The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) today
voted to require insured institutions to prepay slightly over three years of estimated
insurance assessments. The pre-payment allows the FDIC to strengthen the cash
position of the Deposit Insurance Fund (DIF) immediately without immediately impacting
earnings of the industry.
"I am pleased, but not surprised, by the industry's willingness to step up to the task of
rebuilding and strengthening the cash reserves of the fund," said FDIC Chairman Sheila
C. Bair. "In September, I expressed confidence that the industry was up to this
challenge and the industry has not disappointed. The comment letters we received over
this past month made clear that the FDIC and the industry are of the same mind: we will
do whatever it takes to maintain the public's confidence in insured institutions and we
remain committed to maintaining the independence of the Deposit Insurance Fund
through direct industry funding."
Payment of the prepaid assessment, along with the payment of institutions' regular third
quarter assessment, will be due on December 30, 2009. The FDIC estimates that it will
collect approximately $45 billion from total prepaid assessments. The payments will
come from the industry's substantial liquid reserve balances, which as of June 30,
totaled more than $1.3 trillion, or 22 percent more than a year ago.
Unlike a special assessment, which the FDIC collected on September 30, this
prepayment will not immediately affect bank earnings. Banks will book the payments at
the end of each quarter. While the prepayment will immediately improve the FDIC's
liquidity, it will not have an impact on the fund balance.
Federal Deposit Insurance Corporation Each Depositor insured to at least $250,000
November 12, 2009
Media Contact:
Andrew Gray (202) 898-7192
angray@fdic.gov
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-203-2009
FDIC Board Approves Final Rule on Prepaid Assessments
FOR IMMEDIATE RELEASE
The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) today
voted to require insured institutions to prepay slightly over three years of estimated
insurance assessments. The pre-payment allows the FDIC to strengthen the cash
position of the Deposit Insurance Fund (DIF) immediately without immediately impacting
earnings of the industry.
"I am pleased, but not surprised, by the industry's willingness to step up to the task of
rebuilding and strengthening the cash reserves of the fund," said FDIC Chairman Sheila
C. Bair. "In September, I expressed confidence that the industry was up to this
challenge and the industry has not disappointed. The comment letters we received over
this past month made clear that the FDIC and the industry are of the same mind: we will
do whatever it takes to maintain the public's confidence in insured institutions and we
remain committed to maintaining the independence of the Deposit Insurance Fund
through direct industry funding."
Payment of the prepaid assessment, along with the payment of institutions' regular third
quarter assessment, will be due on December 30, 2009. The FDIC estimates that it will
collect approximately $45 billion from total prepaid assessments. The payments will
come from the industry's substantial liquid reserve balances, which as of June 30,
totaled more than $1.3 trillion, or 22 percent more than a year ago.
Unlike a special assessment, which the FDIC collected on September 30, this
prepayment will not immediately affect bank earnings. Banks will book the payments at
the end of each quarter. While the prepayment will immediately improve the FDIC's
liquidity, it will not have an impact on the fund balance.
Chairman Bair emphasized that "the public should know that the discussions over the
past several months have never been about the FDIC's ability to fulfill its commitment to
depositors, but rather how that would be done. The FDIC's commitment to depositors is
absolute, and we and the industry have more than enough resources to make good on
that commitment. No depositor has ever lost a penny of an insured deposit and no
depositor ever will."
# # #
Attachment:
Final Rule on Prepaid Assessments
past several months have never been about the FDIC's ability to fulfill its commitment to
depositors, but rather how that would be done. The FDIC's commitment to depositors is
absolute, and we and the industry have more than enough resources to make good on
that commitment. No depositor has ever lost a penny of an insured deposit and no
depositor ever will."
# # #
Attachment:
Final Rule on Prepaid Assessments