Washington prepares for big bank failure

[Capricious]

Washington prepares for big bank failure - Mar. 6, 2009


NEW YORK (Fortune) -- The government is bracing for a big bank failure.

A bill introduced in Congress would give the FDIC, the agency that stands behind Americans' bank deposits, temporary authority to borrow as much as $500 billion from the government to shore up the deposit insurance fund....





Capricious



"Debts are nowadays like children; begot with pleasure, but brought forth in pain"
(Moliere)

 

[scooterbug44]

This would be the same insurance fund that they haven t been collecting premiums from the banks on and that they raised the limits on by a factor of 2.5?:roll:

 

[Lynnie]

Time for mason jars.

 

[30ashopper]

This would be the same insurance fund that they haven t been collecting premiums from the banks on and that they raised the limits on by a factor of 2.5?:roll:

I've been hearing this a lot, but i can't find any data on it. The last time they cut afaict was 1995?

F.D.I.C. Cuts Commercial Bank Premiums - The New York Times

 

[TooFarTampa]

I've been hearing this a lot, but i can't find any data on it. The last time they cut afaict was 1995?

F.D.I.C. Cuts Commercial Bank Premiums - The New York Times

You may have seen this from Daniel Gross in Newsweek this week -- an interesting read. It's an excerpt from his book. Here's the part where he discusses the insurance premiums, but doesn't give many details:

The Federal Deposit Insurance Corporation stopped collecting insurance premiums when times were good, so long as its rainy-day fund amounted to 1.25 percent of insured deposits?no matter how much banks expanded their balance sheets. It's as if companies stopped selling flood insurance after three years without a hurricane, and shore residents started building really expensive high-rises instead of cottages.

Dumb Money: An excerpt from Dan Gross's new book | Newsweek Business | Newsweek.com