The chairman of the federal insurer of deposits in banks reiterated the safety of federally insured banks amid the coronavirus pandemic during Thursday’s meeting of the federal umbrella Financial Stability Oversight Council (FSOC).
“I want to underscore that our banks are safe. Your FDIC-insured deposits are safe,” said Jelena McWilliams, chairman of the Federal Deposit Insurance Corp. (FDIC). She emphasized that the current crisis did not originate in banks but “is an economic shock brought on by a pandemic unprecedented in modern times. Banks are well positioned to deliver much needed capital and liquidity to communities across the United States.”
McWilliams noted her agency’s work with the other federal financial institution regulators to ensure banks are able to keep lending. She also sought pushed back on those seeking to scare depositors into thinking that they are at risk of losing their insured funds.
“Unfortunately, there are people who are trying to capitalize on public fear and uncertainty for personal benefit,” McWilliams said. “Consumers should have heightened awareness of imposters pretending to be FDIC representatives, or anyone offering unsolicited financial advice. The FDIC does not ever ask for money or personal information, or recommend that consumers move their money out of a bank account.
“The FDIC was born out of a crisis, and it has witnessed many crises. We will get through this one together. Since 1933, no depositor has lost a penny of insured deposits in an FDIC bank, and that will not change.”
The FSOC, created under the Dodd-Frank Act enacted in response to the 2008 financial crisis, is chaired by the Treasury secretary and includes the heads of all five federal financial institution regulators, among others.