This section of the FEDERAL REGISTER
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
Rules and Regulations Federal Register
45093
Vol. 74, No. 168
Tuesday, September 1, 2009
1 See Section 13(c)(4)(G) of the Federal Deposit
Insurance Act (FDI Act), 12 U.S.C. 1823(c)(4)(G).
The determination of systemic risk authorized the
FDIC to take actions to avoid or mitigate serious
adverse effects on economic conditions or financial
stability, and the FDIC implemented the TLGP in
response. Section 9(a) Tenth of the FDI Act, 12
U.S.C. 1819(a)Tenth, provides additional authority
for the establishment of the TLGP.
2 73 FR 64179 (October 29, 2008). The Final Rule
was published in the Federal Register on November
26, 2008. 73 FR 72244 (November 26, 2008).
3 The other component of the TLGP, the DGP,
initially permitted participating entities to issue
FDIC-guaranteed senior unsecured debt until June
30, 2009, with the FDIC’s guarantee for such debt
to expire on the earlier of the maturity of the debt
(or the conversion date, for mandatory convertible
debt) or June 30, 2012. To reduce market disruption
at the conclusion of the DGP and to facilitate the
orderly phase-out of the program, the Board issued
a final rule that generally extended for four months
the period during which participating entities could
issue FDIC-guaranteed debt. 74 FR 26521 (June 3,
2009). All IDIs and those other participating entities
that had issued FDIC-guaranteed debt on or before
April 1, 2009, were permitted to participate in the
extended DGP without application to the FDIC.
Other participating entities that were specifically
approved by the FDIC also could participate in the
extended DGP. At the same time, the FDIC extended
the expiration of the guarantee period from June 30,
2012 to December 31, 2012. As a result,
participating entities may issue FDIC-guaranteed,
debt through and including October 31, 2009, and
the FDIC’s guarantee for such debt expires on the
earliest of the mandatory convertible debt, the
stated date of maturity, or December 31, 2012.
4 12 CFR 370.5(h)(5).
5 Id.
6 Id.
7 12 CFR 370.7(c).
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 370
RIN 3064–AD37
Final Rule Regarding Limited
Amendment of the Temporary Liquidity
Guarantee Program To Extend the
Transaction Account Guarantee
Program With Modified Fee Structure
AGENCY: Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule.
SUMMARY: To assure an orderly phase
out of the Transaction Account
Guarantee (TAG) component of the
Temporary Liquidity Guarantee Program
(TLGP), the FDIC is extending the TAG
program for six months until June 30,
2010. Each insured depository
institution (IDI) that participates in the
extended TAG program will be subject
to increased fees during the extension
period for the FDIC’s guarantee of
qualifying noninterest-bearing
transaction accounts. However, each IDI
that is currently participating in the
TAG program will have an opportunity
to opt out of the extended TAG program.
Each IDI that is currently participating
in the TAG program must review and
update its disclosure postings and
notices to accurately reflect whether it
is participating in the extended TAG
program.
DATES: The Final rule becomes effective
on October 1, 2009.
FOR FURTHER INFORMATION CONTACT:
Christopher L. Hencke, Counsel, Legal
Division, (202) 898–8839 or
chencke@fdic.gov; A. Ann Johnson,
Counsel, Legal Division, (202) 898–3573
or aajohnson@fdic.gov; Robert C. Fick,
Counsel, Legal Division, (202) 898–8962
or rfick@fdic.gov; Joe DiNuzzo, Counsel,
Legal Division, (202) 898–7349 or
jdinuzzo@fdic.gov; Lisa D Arquette,
Associate Director, Division of
Supervision and Consumer Protection,
(202) 898–8633 or larquette@fdic.gov;
Donna Saulnier, Manager, Assessment
Policy Section, Division of Finance,
(703) 562–6167 or dsaulnier@fdic.gov;
or Munsell St. Clair, Chief, Bank and
Regulatory Policy Section, Division of
Insurance and Research, (202) 898–8967
or mstclair@fdic.gov.
SUPPLEMENTARY INFORMATION
I. Background
The FDIC established the TLGP in
October 2008 following a determination
of systemic risk by the Secretary of the
Treasury (after consultation with the
President) that was supported by
recommendations from the FDIC and
the Board of Governors of the Federal
Reserve System (Federal Reserve).1 The
TLGP is part of a coordinated effort by
the FDIC, the U.S. Department of the
Treasury (Treasury), and the Federal
Reserve to address unprecedented
disruptions in credit markets and the
resultant inability of financial
institutions to fund themselves and
make loans to creditworthy borrowers.
On October 23, 2008, the FDIC’s
Board of Directors (Board) authorized
the publication in the Federal Register
of an interim rule that outlined the
structure of the TLGP.2 Designed to
assist in the stabilization of the nation’s
financial system, the FDIC’s TLGP is
composed of two distinct components:
The Debt Guarantee Program (DGP) and
the TAG program. Pursuant to the DGP
the FDIC guarantees certain senior
unsecured debt issued by participating
entities. Pursuant to the TAG program
the FDIC guarantees all funds held in
qualifying noninterest-bearing
transaction accounts at participating
IDIs.
The TAG program was originally
scheduled to expire on December 31,
2009.3 Over 7,100 IDIs participate in the
TAG program, and the FDIC has
guaranteed an estimated $700 billion of
deposits in noninterest-bearing
transaction accounts that would not
otherwise be insured. Under the TAG
program each IDI that offers noninterest-
bearing transaction accounts is required
to post a conspicuous notice in the
lobby of its main office and each branch
office, and on its Web site, if applicable,
that discloses whether the IDI is
participating in the TAG program.4
Disclosures for participating IDIs must
contain a statement that indicates that
all noninterest-bearing transaction
accounts are fully guaranteed by the
FDIC.5 In addition, even those IDIs that
are not participating in the TAG
program are required to disclose that
deposits in noninterest-bearing
transaction accounts continue to be
insured for up to $250,000, pursuant to
the FDIC’s general deposit insurance
rules.6 At this time, IDIs participating in
the TAG program pay quarterly an
annualized 10 basis point assessment on
any deposit amounts that exceed the
existing deposit insurance limit.7
II. The Notice of Proposed Rulemaking
As with those entities participating in
the DGP, the FDIC is committed to
providing an orderly phase-out of the
TAG program for participating IDIs and
their depositors. To that end, the Board
authorized publication in the Federal
Register of a notice of proposed
rulemaking that presented two
VerDate Nov<24>2008 16:24 Aug 31, 2009 Jkt 217001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\01SER1.SGM 01SER1
mstockstill on DSKH9S0YB1PROD with RULES
contains regulatory documents having general
applicability and legal effect, most of which
are keyed to and codified in the Code of
Federal Regulations, which is published under
50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by
the Superintendent of Documents. Prices of
new books are listed in the first FEDERAL
REGISTER issue of each week.
Rules and Regulations Federal Register
45093
Vol. 74, No. 168
Tuesday, September 1, 2009
1 See Section 13(c)(4)(G) of the Federal Deposit
Insurance Act (FDI Act), 12 U.S.C. 1823(c)(4)(G).
The determination of systemic risk authorized the
FDIC to take actions to avoid or mitigate serious
adverse effects on economic conditions or financial
stability, and the FDIC implemented the TLGP in
response. Section 9(a) Tenth of the FDI Act, 12
U.S.C. 1819(a)Tenth, provides additional authority
for the establishment of the TLGP.
2 73 FR 64179 (October 29, 2008). The Final Rule
was published in the Federal Register on November
26, 2008. 73 FR 72244 (November 26, 2008).
3 The other component of the TLGP, the DGP,
initially permitted participating entities to issue
FDIC-guaranteed senior unsecured debt until June
30, 2009, with the FDIC’s guarantee for such debt
to expire on the earlier of the maturity of the debt
(or the conversion date, for mandatory convertible
debt) or June 30, 2012. To reduce market disruption
at the conclusion of the DGP and to facilitate the
orderly phase-out of the program, the Board issued
a final rule that generally extended for four months
the period during which participating entities could
issue FDIC-guaranteed debt. 74 FR 26521 (June 3,
2009). All IDIs and those other participating entities
that had issued FDIC-guaranteed debt on or before
April 1, 2009, were permitted to participate in the
extended DGP without application to the FDIC.
Other participating entities that were specifically
approved by the FDIC also could participate in the
extended DGP. At the same time, the FDIC extended
the expiration of the guarantee period from June 30,
2012 to December 31, 2012. As a result,
participating entities may issue FDIC-guaranteed,
debt through and including October 31, 2009, and
the FDIC’s guarantee for such debt expires on the
earliest of the mandatory convertible debt, the
stated date of maturity, or December 31, 2012.
4 12 CFR 370.5(h)(5).
5 Id.
6 Id.
7 12 CFR 370.7(c).
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 370
RIN 3064–AD37
Final Rule Regarding Limited
Amendment of the Temporary Liquidity
Guarantee Program To Extend the
Transaction Account Guarantee
Program With Modified Fee Structure
AGENCY: Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule.
SUMMARY: To assure an orderly phase
out of the Transaction Account
Guarantee (TAG) component of the
Temporary Liquidity Guarantee Program
(TLGP), the FDIC is extending the TAG
program for six months until June 30,
2010. Each insured depository
institution (IDI) that participates in the
extended TAG program will be subject
to increased fees during the extension
period for the FDIC’s guarantee of
qualifying noninterest-bearing
transaction accounts. However, each IDI
that is currently participating in the
TAG program will have an opportunity
to opt out of the extended TAG program.
Each IDI that is currently participating
in the TAG program must review and
update its disclosure postings and
notices to accurately reflect whether it
is participating in the extended TAG
program.
DATES: The Final rule becomes effective
on October 1, 2009.
FOR FURTHER INFORMATION CONTACT:
Christopher L. Hencke, Counsel, Legal
Division, (202) 898–8839 or
chencke@fdic.gov; A. Ann Johnson,
Counsel, Legal Division, (202) 898–3573
or aajohnson@fdic.gov; Robert C. Fick,
Counsel, Legal Division, (202) 898–8962
or rfick@fdic.gov; Joe DiNuzzo, Counsel,
Legal Division, (202) 898–7349 or
jdinuzzo@fdic.gov; Lisa D Arquette,
Associate Director, Division of
Supervision and Consumer Protection,
(202) 898–8633 or larquette@fdic.gov;
Donna Saulnier, Manager, Assessment
Policy Section, Division of Finance,
(703) 562–6167 or dsaulnier@fdic.gov;
or Munsell St. Clair, Chief, Bank and
Regulatory Policy Section, Division of
Insurance and Research, (202) 898–8967
or mstclair@fdic.gov.
SUPPLEMENTARY INFORMATION
I. Background
The FDIC established the TLGP in
October 2008 following a determination
of systemic risk by the Secretary of the
Treasury (after consultation with the
President) that was supported by
recommendations from the FDIC and
the Board of Governors of the Federal
Reserve System (Federal Reserve).1 The
TLGP is part of a coordinated effort by
the FDIC, the U.S. Department of the
Treasury (Treasury), and the Federal
Reserve to address unprecedented
disruptions in credit markets and the
resultant inability of financial
institutions to fund themselves and
make loans to creditworthy borrowers.
On October 23, 2008, the FDIC’s
Board of Directors (Board) authorized
the publication in the Federal Register
of an interim rule that outlined the
structure of the TLGP.2 Designed to
assist in the stabilization of the nation’s
financial system, the FDIC’s TLGP is
composed of two distinct components:
The Debt Guarantee Program (DGP) and
the TAG program. Pursuant to the DGP
the FDIC guarantees certain senior
unsecured debt issued by participating
entities. Pursuant to the TAG program
the FDIC guarantees all funds held in
qualifying noninterest-bearing
transaction accounts at participating
IDIs.
The TAG program was originally
scheduled to expire on December 31,
2009.3 Over 7,100 IDIs participate in the
TAG program, and the FDIC has
guaranteed an estimated $700 billion of
deposits in noninterest-bearing
transaction accounts that would not
otherwise be insured. Under the TAG
program each IDI that offers noninterest-
bearing transaction accounts is required
to post a conspicuous notice in the
lobby of its main office and each branch
office, and on its Web site, if applicable,
that discloses whether the IDI is
participating in the TAG program.4
Disclosures for participating IDIs must
contain a statement that indicates that
all noninterest-bearing transaction
accounts are fully guaranteed by the
FDIC.5 In addition, even those IDIs that
are not participating in the TAG
program are required to disclose that
deposits in noninterest-bearing
transaction accounts continue to be
insured for up to $250,000, pursuant to
the FDIC’s general deposit insurance
rules.6 At this time, IDIs participating in
the TAG program pay quarterly an
annualized 10 basis point assessment on
any deposit amounts that exceed the
existing deposit insurance limit.7
II. The Notice of Proposed Rulemaking
As with those entities participating in
the DGP, the FDIC is committed to
providing an orderly phase-out of the
TAG program for participating IDIs and
their depositors. To that end, the Board
authorized publication in the Federal
Register of a notice of proposed
rulemaking that presented two
VerDate Nov<24>2008 16:24 Aug 31, 2009 Jkt 217001 PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 E:\FR\FM\01SER1.SGM 01SER1
mstockstill on DSKH9S0YB1PROD with RULES
45094 Federal Register / Vol. 74, No. 168 / Tuesday, September 1, 2009 / Rules and Regulations
8 74 FR 31217 (June 30, 2009).
alternatives for phasing out the TAG
program (the ‘‘Proposed Rule’’).8
The first alternative described in the
Proposed Rule, designated Alternative
A, would preserve the original
termination date for the TAG program.
For those IDIs that had not opted out of
the TAG program, under this option, the
FDIC’s guarantee of noninterest-bearing
transaction accounts would expire on
December 31, 2009.
The second alternative, designated
Alternative B, proposed the extension of
the TAG program through June 30, 2010,
six months beyond the current
expiration date of December 31, 2009.
Under this option, IDIs are provided an
opportunity to opt out of the extended
TAG program; if an IDI that is currently
participating in the program opts out,
Alternative B provided that the FDIC’s
guarantee would expire as scheduled on
December 31, 2009. To balance the
income generated from TAG fees with
potential losses associated with the TAG
program during the extension period,
the FDIC proposed to increase the
assessment rate to an annualized rate of
25 basis points (rather than the current
10 basis points) on the guaranteed
deposits in noninterest-bearing
transaction accounts. Under this option,
the increased fee would be collected
quarterly in the same manner provided
in existing regulations. Finally,
Alternative B recognized that some IDIs
would have to revise their disclosures
related to the TAG program. This would
be required only if their current
disclosures became inaccurate following
extension of the TAG program. For
example, under Alternative B, each IDI
that is participating in the extension
would need to revise its disclosures if
its existing disclosures indicated that
the FDIC’s guarantee will apply only
through December 31, 2009. Such an IDI
would need to revise its disclosures to
indicate that the guarantee will apply
through June 30, 2010.
III. Comment Summary and Discussion
The FDIC requested comment on
every aspect of the Proposed Rule. In
addition, the FDIC posed specific
questions relating to proposed
Alternative B. The FDIC received 91
comments on the proposed rule. The
commenters included 60 insured
depository institutions, 13 industry
associations, 5 holding companies, 7
state government entities, 3 bankers’
banks, and 3 depositors. A summary of
the comments, including a summary of
the comments addressing the specific
questions, follows.
A. Alternatives for Phasing Out TAG
Program
The FDIC sought information on
whether commenters preferred
Alternative A or Alternative B (or some
other alternative) as the most
appropriate means of insuring an
orderly phase-out of the FDIC’s TAG
program. The FDIC received 15
comments expressly supporting
Alternative A and 44 comments
expressly supporting Alternative B. A
summary of the comments the FDIC
received in both of those categories
follows.
Comments Favoring Alternative A
The FDIC received 15 comments
expressly supporting Alternative A.
Commenters supporting Alternative A
generally shared the opinion that
financial market volatility and risk
aversion have moderated since the FDIC
implemented the TAG program in the
fall of 2008. These commenters
generally noted that recent economic
and financial market improvements,
such as greater access to debt and
capital markets and increased depositor
and consumer confidence in the
banking system, have eliminated the
need for the TAG program.
A small number of commenters
supporting Alternative A expressed
concern that an extension of the TAG
program would burden healthy
institutions that elect to opt out. An
insured depository institution electing
to opt out of the extended TAG program
would be required to disclose to
customers that balances in its non-
interest-bearing transaction accounts
exceeding the $250,000 limit are no
longer guaranteed under the TAG
program. Several commenters expressed
concern that such disclosures would
result in a loss of depositor
relationships. Similarly, a small number
of the comments favoring Alternative A
suggested that extending the TAG
program with an opt-out election as
proposed under Alternative B would
effectively punish institutions electing
to opt out and give an unfair
competitive advantage to those
institutions that elect to remain in the
TAG program through the extended
period. Specifically, these commenters
expressed concern that customers
would inaccurately perceive a bank’s
election to opt out of the TAG program
extension as an indication that the non-
interest bearing transaction account
balances exceeding $250,000 at that
bank are at risk. To avoid customer
confusion and any unfair competitive
advantage being created by an extension
of the TAG program, these commenters
recommended that the FDIC allow the
TAG program to phase out under
Alternative A.
Comments Favoring Alternative B
The FDIC received 44 comments
expressly supporting Alternative B as
the more appropriate method of phasing
out the TAG program. Commenters that
supported Alternative B generally
expressed a belief that, despite vast
improvement since the fall of 2008, the
economy has not yet stabilized to the
point that depositors would be
comfortable having large uninsured or
non-guaranteed transaction balances on
deposit with smaller insured depository
institutions or community banks. A
number of comments the FDIC received
from community banks and state and
national banking industry associations
expressed concerns that regions of the
country most affected by the recent
financial and economic turmoil would
not see an improvement in depositor
confidence within the phase-out time
period proposed in Alternative A. These
commenters also emphasized that an
extension of the TAG program is
important to the country’s continuing
economic recovery.
The FDIC also received several
comments expressing concern that
expiration of the TAG program under
Alternative A would result in a
significant shift in large business
deposits and public deposits away from
community banks. Given the current
economic environment, depositors with
large balances in non-interest bearing
transaction accounts could be motivated
to move their deposits away from
smaller insured depository institutions
for the perceived security of a larger
‘‘too big to fail’’ insured depository
institution if the TAG program were to
expire. A depletion of large noninterest-
bearing transaction account balances
would significantly harm community
banks and smaller insured depository
institutions by putting them at risk of
becoming troubled, especially in those
regions of the country still recovering
economically.
In addition, the FDIC received several
comments concerning the effect that
recent media coverage has had on the
public’s perception of the banking
industry. As one community bank
noted, news stories covering the current
problems with commercial real estate
and bank failures have caused the
business community and many
depositors to be very concerned about
the safety of their money. The
commenter recommended adopting
Alternative B as an appropriate phase
out for the TAG program because it
would counter such negative media
VerDate Nov<24>2008 16:24 Aug 31, 2009 Jkt 217001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\01SER1.SGM 01SER1
mstockstill on DSKH9S0YB1PROD with RULES
8 74 FR 31217 (June 30, 2009).
alternatives for phasing out the TAG
program (the ‘‘Proposed Rule’’).8
The first alternative described in the
Proposed Rule, designated Alternative
A, would preserve the original
termination date for the TAG program.
For those IDIs that had not opted out of
the TAG program, under this option, the
FDIC’s guarantee of noninterest-bearing
transaction accounts would expire on
December 31, 2009.
The second alternative, designated
Alternative B, proposed the extension of
the TAG program through June 30, 2010,
six months beyond the current
expiration date of December 31, 2009.
Under this option, IDIs are provided an
opportunity to opt out of the extended
TAG program; if an IDI that is currently
participating in the program opts out,
Alternative B provided that the FDIC’s
guarantee would expire as scheduled on
December 31, 2009. To balance the
income generated from TAG fees with
potential losses associated with the TAG
program during the extension period,
the FDIC proposed to increase the
assessment rate to an annualized rate of
25 basis points (rather than the current
10 basis points) on the guaranteed
deposits in noninterest-bearing
transaction accounts. Under this option,
the increased fee would be collected
quarterly in the same manner provided
in existing regulations. Finally,
Alternative B recognized that some IDIs
would have to revise their disclosures
related to the TAG program. This would
be required only if their current
disclosures became inaccurate following
extension of the TAG program. For
example, under Alternative B, each IDI
that is participating in the extension
would need to revise its disclosures if
its existing disclosures indicated that
the FDIC’s guarantee will apply only
through December 31, 2009. Such an IDI
would need to revise its disclosures to
indicate that the guarantee will apply
through June 30, 2010.
III. Comment Summary and Discussion
The FDIC requested comment on
every aspect of the Proposed Rule. In
addition, the FDIC posed specific
questions relating to proposed
Alternative B. The FDIC received 91
comments on the proposed rule. The
commenters included 60 insured
depository institutions, 13 industry
associations, 5 holding companies, 7
state government entities, 3 bankers’
banks, and 3 depositors. A summary of
the comments, including a summary of
the comments addressing the specific
questions, follows.
A. Alternatives for Phasing Out TAG
Program
The FDIC sought information on
whether commenters preferred
Alternative A or Alternative B (or some
other alternative) as the most
appropriate means of insuring an
orderly phase-out of the FDIC’s TAG
program. The FDIC received 15
comments expressly supporting
Alternative A and 44 comments
expressly supporting Alternative B. A
summary of the comments the FDIC
received in both of those categories
follows.
Comments Favoring Alternative A
The FDIC received 15 comments
expressly supporting Alternative A.
Commenters supporting Alternative A
generally shared the opinion that
financial market volatility and risk
aversion have moderated since the FDIC
implemented the TAG program in the
fall of 2008. These commenters
generally noted that recent economic
and financial market improvements,
such as greater access to debt and
capital markets and increased depositor
and consumer confidence in the
banking system, have eliminated the
need for the TAG program.
A small number of commenters
supporting Alternative A expressed
concern that an extension of the TAG
program would burden healthy
institutions that elect to opt out. An
insured depository institution electing
to opt out of the extended TAG program
would be required to disclose to
customers that balances in its non-
interest-bearing transaction accounts
exceeding the $250,000 limit are no
longer guaranteed under the TAG
program. Several commenters expressed
concern that such disclosures would
result in a loss of depositor
relationships. Similarly, a small number
of the comments favoring Alternative A
suggested that extending the TAG
program with an opt-out election as
proposed under Alternative B would
effectively punish institutions electing
to opt out and give an unfair
competitive advantage to those
institutions that elect to remain in the
TAG program through the extended
period. Specifically, these commenters
expressed concern that customers
would inaccurately perceive a bank’s
election to opt out of the TAG program
extension as an indication that the non-
interest bearing transaction account
balances exceeding $250,000 at that
bank are at risk. To avoid customer
confusion and any unfair competitive
advantage being created by an extension
of the TAG program, these commenters
recommended that the FDIC allow the
TAG program to phase out under
Alternative A.
Comments Favoring Alternative B
The FDIC received 44 comments
expressly supporting Alternative B as
the more appropriate method of phasing
out the TAG program. Commenters that
supported Alternative B generally
expressed a belief that, despite vast
improvement since the fall of 2008, the
economy has not yet stabilized to the
point that depositors would be
comfortable having large uninsured or
non-guaranteed transaction balances on
deposit with smaller insured depository
institutions or community banks. A
number of comments the FDIC received
from community banks and state and
national banking industry associations
expressed concerns that regions of the
country most affected by the recent
financial and economic turmoil would
not see an improvement in depositor
confidence within the phase-out time
period proposed in Alternative A. These
commenters also emphasized that an
extension of the TAG program is
important to the country’s continuing
economic recovery.
The FDIC also received several
comments expressing concern that
expiration of the TAG program under
Alternative A would result in a
significant shift in large business
deposits and public deposits away from
community banks. Given the current
economic environment, depositors with
large balances in non-interest bearing
transaction accounts could be motivated
to move their deposits away from
smaller insured depository institutions
for the perceived security of a larger
‘‘too big to fail’’ insured depository
institution if the TAG program were to
expire. A depletion of large noninterest-
bearing transaction account balances
would significantly harm community
banks and smaller insured depository
institutions by putting them at risk of
becoming troubled, especially in those
regions of the country still recovering
economically.
In addition, the FDIC received several
comments concerning the effect that
recent media coverage has had on the
public’s perception of the banking
industry. As one community bank
noted, news stories covering the current
problems with commercial real estate
and bank failures have caused the
business community and many
depositors to be very concerned about
the safety of their money. The
commenter recommended adopting
Alternative B as an appropriate phase
out for the TAG program because it
would counter such negative media
VerDate Nov<24>2008 16:24 Aug 31, 2009 Jkt 217001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\01SER1.SGM 01SER1
mstockstill on DSKH9S0YB1PROD with RULES