X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

WASHINGTON — The FDIC Board, in its recent open meeting, approved the final regulations implementing the Federal Deposit Insurance Reform Act. Three major banking trade associations have said that the premiums assessed at that meeting are too high.

The agency established a risk-based assessment system that will allow the insurer to more closely tie a bank’s premiums to the risk it presents to the deposit insurance fund. As a result of the final rulemaking, the FDIC set the assessment rates, varying between five and seven cents for every $100 of domestic deposits, that will take effect at the beginning of 2007. “The premiums are much too high considering the FDIC’s flexibility under the new system,” American Bankers Association Chief Economist James Chessen said. “There is no requirement to boost the revenues of the fund–and no need to given the $50 billion in the fund already. The banking industry is in exceptional health, and there is no indication that large amounts of revenue are needed by the FDIC… Additional money sitting idle in Washington adds little to the financial strength of the FDIC, but has real consequences for the communities that banks serve.” He noted that banks with supervisory concerns could pay as much as 43 basis points.

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?

Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.