FDIC's Bair warns on bank deposit insurance fund

Houston Chronicle ^

[txmissy]

WASHINGTON — The head of the Federal Deposit Insurance Corp. has warned that the fund insuring Americans’ bank deposits could be wiped out this year without the money the agency is seeking in new fees from U.S. banks and thrifts.

FDIC Chairman Sheila Bair acknowledged, in a letter to bank CEOs, that the new increased fees and hefty emergency premium the agency voted to levy last week will bring a “significant expense” to banks, especially amid a recession and financial crisis when their earnings are under pressure.

“We also recognize that assessments reduce the funds that banks can lend in their communities to help revitalize the economy,” Bair wrote.

But given the accelerating bank failures that have been depleting the deposit insurance fund, she said, it “could become insolvent this year.”

“Without substantial amounts of additional assessment revenue in the near future, current projections indicate that the fund balance will approach zero or even become negative,” Bair wrote in the letter dated Monday to the chief executives of the nation’s 8,305 federally insured banks and thrifts.

[mysterio]

If FDIC goes under, that's cats lying down with dogs mass chaos territory.

If a bank falls in the forest and the money in it isn't worth anything, will there still be a run? That's the $64,000,000,000,000,000,000 question.

[txmissy]

I was wondering the same thing about my savings account.

UGH!

[jessduntno]

This is where we Nationalize the entire banking system...

[txmissy]

Thanks...that makes me feel better....a little.

[allmost]

This is where we Nationalize the entire banking system..

This is part of PR assault behind that goal.

[Red in Blue PA]

There was a story the other day about increased requirements for banks from the FDIC.

[jessduntno]

“This is where we Nationalize the entire banking system..
This is part of PR assault behind that goal.”

Exactly.

[Son House]

EFT, Electronic Funds Transfer, Bet, at some point all this Government stimulus spending will be EFT, with no real money to back it, √-1 = i

[dinoparty]

Exactly ... and then the money that we have sitting in bank accounts, while insured, will be increasingly worthless! Whoo-hoo!

[Bahbah]

Is this Biden’s ‘manufactured crisis’?

Possibly. He was vague enough.

[Mad Dawgg]

"The head of the Federal Deposit Insurance Corp. has warned that the fund insuring Americans’ bank deposits could be wiped out this year without the money the agency is seeking in new fees from U.S. banks and thrifts."

Rot Ro Relroy!

[reader25]

Looks like I will be purchasing a safe and install in the concrete floor. Then I will remove all funds from banks and investment firms. After the Obama induced collapse of the financial system cash will be king.

[Sarajevo]

the FDIC won't "go broke" unless the whole government "goes broke".

You mean we aren't broke already?

I don't know if I am being sarcastic or not at this point..........

[WVKayaker]

After the Obama induced collapse of the financial system cash will be king.

A can of lima beans will be worth more than all that paper in that big safe... and a canned ham will probably buy you a car!

[Oldeconomybuyer]

Holy schnikes!

[edcoil]

What that another branch of government is broke.

[twigs]

Remember what the Obama administration’s goals are. They want to break capitalism. They want to nationalize. They want socialism. I suspect they want communism. This is all part of the game plan.

[Mad Dawgg]

"After the Obama induced collapse of the financial system cash will be king."

EDIT: After the Obama induced collapse of the financial system cash Precious Metals (Lead And Brass) will be king.

[unkus]

Ping!

[traderrob6]

Scary nonetheless.