FDIC Finalizes Rule Requiring Banks to Pay More for Deposit Insurance

Source: American Banker

The Federal Deposit Insurance Corp. Board voted unanimously to finalize a rule requiring banks to pay more for deposit insurance, despite industry objections. 

In a 3-0 vote, the FDIC passed a rule to increase assessment rates 2 basis points beginning the first quarter of next year, aiming to return the deposit insurance fund to its statutory minimum of 1.35%. Deposits rose dramatically during the pandemic and have remained high, bringing the Deposit Insurance Fund below its required minimum ratio to 1.26% as of June. 

The FDIC estimates that the rate hike would reduce banks' income on average by 1.2%.