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Tuesday, May 28, 2024

FDIC seeks to raise bank premiums

Federal regulators today proposed doubling the amount banks pay to insure their deposits, reflecting the hit the government’s insurance fund has taken by the failure of Pasadena-based IndyMac Bank and 12 other institutions this year — and projections of more failures to come. The board of the Federal Deposit Insurance Corp. gave unanimous initial approval to a five-year plan to replenish the Deposit Insurance Fund, which has fallen below its mandated level. The fund had $45.2 billion as of June 30, representing 1.01% of insured domestic deposits. It is not supposed to fall below 1.15%, and the FDIC prefers it to be at 1.25% so that there is enough money to cover insured deposits in failed banks. For full story visit www.latimes.com/business/la-fi-deposit8-2008oct08,0,3373333.story

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