Proposes New Risk-Based Insurance Assessment System
The FDIC's Board of Directors today approved for public comment
two proposed rules governing deposit insurance assessments under
the Federal Deposit Insurance Reform Act of 2005. One proposal
would create a new system that would more closely tie what banks
pay for deposit insurance to the risks they pose. It also would
adopt a new base schedule of rates that the FDIC Board could
adjust up or down, depending upon the revenue needs of the insurance
fund. The second proposal issued today would continue to set
the designated reserve ratio (DRR) for the fund at 1.25 percent
of estimated insured deposits.
proposed new system of risk-based assessments would allow the
FDIC to adhere more closely to sound insurance principles because
the safer an institution is, the less it will pay for deposit
insurance," said FDIC Chairman Sheila Bair. "We hope
that most FDIC-insured institutions will find our proposals
reasonable and fair, and we look forward to receiving comments."
on the proposed rules are due within 60 days of publication
in the Federal Register, which is expected to occur within a
a related action, the FDIC Board also issued for comment a proposed
new official sign for institutions to display at teller stations
and elsewhere. The proposal also would, for the first time,
require both banks and savings associations to use the same
sign and rules for advertising FDIC membership. Comments on
this proposed rule are also due within 60 days of publication
in the Federal Register.
proposed rules issued today are in addition to three others
governing deposit insurance assessments that the Board approved
for public comment on May 9, including a proposed rule that
would allocate a one-time $4.7 billion assessment credit among
insured institutions. Comments on these earlier published rules
are due August 16, 2006.
Reform Act requires the FDIC to prescribe final regulations
in these areas by November 5, 2006.