The FDIC has issued a letter to financial institutions warning them against charging customers an “FDIC fee” in an attempt to compensate for deposit insurance assessments.
The bank regulator said it has received approximately 100 complaints from depositors about the fees.
“While insured depository institutions are not prohibited from passing the costs of deposit insurance on to customers, the FDIC discourages institutions from specifically designating that a customer fee is for deposit insurance or from stating or implying that the FDIC is charging such a fee,” the letter issued Monday said.
The FDIC is concerned that, because it charges insurance assessments based upon an institution’s risk, identifying fees with deposit insurance could reveal a bank’s supervisory status. And, the federal bank regulator doesn’t want consumers to believe that the FDIC mandates such charges.
“Institutions should review their designation and identification of fees and ensure that those fees do not reveal confidential supervisory information or mislead customers,” the letter said.
The FDIC reported in April that despite fewer bank failures, its assessments, which range between 5 and 35 basis points, may not decrease until 2018.
Even though the FDIC’s deposit insurance fund has increased to $11.8 billion as of Dec. 31, up from a nearly $21 billion deficit as of year-end 2009, the Dodd-Frank Act requires the bank regulator to increase its reserve ratio to 1.35% by 2020. As of 2011 year-end, the ratio was 0.17%.