Is The FDIC Understating The Cost Of Bank Failures?

When a banking failure occurs, the FDIC’s goal is to protect depositors and seamlessly arrange a transfer of deposits and a sale of assets to a healthy institution.  To enhance the attractiveness of a closed bank to a potential buyer and to reduce the FDIC’s immediate cash needs,  the FDIC has made extensive use of […]

Are Retained Asset Accounts At Insurance Companies FDIC Insured?

August 12, 2010 – The FDIC warned the insurance industry to properly disclose to consumers that Retained Asset Accounts (RAAs) are generally not insured by the FDIC Deposit Insurance Fund.   Reacting to reports in the media that many customers believe that RAAs are FDIC insured, the FDIC sent a letter to the National Association of […]

LibertyBank, Eugene, Oregon, Closed By Regulators

July 30, 2010 – The Oregon Division of Finance and Corporate Securities closed LibertyBank, Eugene, Oregon, and appointed the FDIC as receiver.  The deposits and a portion of the failed bank’s assets were acquired by Home Federal Bank, Nampa, Idaho, under a purchase and assumption agreement with the FDIC. LibertyBank had 15 branches in Oregon, […]

FDIC Extends Guarantee On Transaction Account Balances

June 22, 2010 – The FDIC Board of Directors extended the Transaction Account Guarantee  (TAG) program six months beyond its original expiration to December 31, 2010.   In addition, the Board approved for an additional extension, if deemed necessary, to December 31, 2011. The TAG program was initiated in October 2008 as part of the Temporary […]

FDIC Deposit Insurance Fund To Remain Underfunded Until 2017

The FDIC estimated today that the FDIC Deposit Insurance Fund (DIF), which protects depositors in the case of banking failures, will not return to the statutory minimum level required until the first quarter of 2017.   The largest number of banking failures in twenty years has depleted the DIF, even after the FDIC collected $46 billion […]

FDIC Deposit Insurance Limits To Permanently Increase – Savers Finally Win One

June 17, 2010 – Lawmakers have agreed to make permanent the temporary increase on depositor insurance by the FDIC.   To avoid depositor panic during the height of the financial crisis in the fall of 2008, the government temporarily increased deposit insurance limit from $100,000 to $250,000.   The increased deposit insurance was due to expire on […]

Nebraska Rocked By Closing Of $3 Billion TierOne Bank, Lincoln, NE

Shareholders Facing 100% Loss On Investment June 4, 2010 – Nebraska’s first bank closing of 2010 was the giant TierOne Bank of Lincoln, Nebraska.  TierOne was one of the largest publicly held thrifts in the Midwest and had 69 branches located in Nebraska, Iowa and Kansas.   According to the bank’s website, TierOne was originally organized […]

FDIC Problem Banks Increase 10% In First Quarter

Problem Banks Increase Again The latest FDIC Quarterly Banking Profile shows a 10% increase in the number of Problem Banks to 775 at March 31, 2010, up from 702 at December 31, 2009.    Although industry trends show improvement over previous quarters, almost 19% of all banking institutions reported net losses for the quarter, down from […]

Banking Failures On Track To Exceed 2009 Total As 4 More Banks Fail

4 Banking Failures In 4 States Brings Year’s Total To 72 Four banks in four different states failed today, bringing the year’s total of banking failures to 72.  Regulators closed three relatively small banks in Georgia, Michigan and Missouri and one multi-billion dollar bank in Illinois, resulting in total losses to the Federal Deposit Insurance […]

Regulators Close Banks In 4 States – Bank Failures Up 100% Over 2009

Four Banks Fail In Four States May 7, 2010 – The Federal Deposit Insurance Corporation (FDIC) closed four more banks in Florida, Arizona, Minnesota and California.  The total number of failed banks for the year is now 68, double the number of failures at this point during 2009.  During 2009, 140 banks failed in the United States, […]