The FDIC insurance cap is almost always waived for individual depositors. As a matter of policy, my guess is that it will also be waived for corporate depositors in this instance because of the economic and political importance of venture capital.
“ The FDIC insurance cap is almost always waived for individual depositors. As a matter of policy, my guess is that it will also be waived for corporate depositors in this instance because of the economic and political importance of venture capital.”
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Thanks, I didn’t know that. Why even have an insurance “cap”?
I worked at the FDIC during the last bank crisis. I don’t recall one instance where the insurance cap was waived. If there are any funds left over after paying insured depositors, then a process is set up where uninsured depositors may file a claim.
No. They do take priority over most other creditors but fall below administrative expenses of the Receiver. (And then there is the subrogation rights arising from the insurance payout.)