FDIC Board gives green light to $2.96 operating budget for ’24; includes 189 new positions

An operating budget for 2024 of nearly $3 billion – down 6.3% from the previous year – was approved by the board of the federal bank deposit insurance agency late Wednesday, the agency said.

According to the Federal Deposit Insurance Corporation (FDIC) the new year’s operating budget of $2.96 billion provides for a 57.5% decline (by $475 million) in receivership funding but a 12% increase (by $275 million) for the “ongoing operations” portion of the budget – which represents 86% of the total operating budget.

The new year’s budget also authorizes 189 new positions, most of which the agency said would perform “core mission responsibilities” of the agency. “Many of the new positions are being added to increase the monitoring and supervision of large banks,” the agency added.

The 2024 budget, according to FDIC Board Chairman Martin Gruenberg, was devised following the failures of three large regional banks in 2023 and, he said, “reflects the lessons learned from those failures.”

“Of particular importance, the proposed budget includes substantial new resource to perform increased supervisory monitoring of large insured institutions on an ongoing basis to support early detection of emerging risks and quicker action to ensure that banks are taking the necessary steps to mitigate such risks,” Gruenberg said in a statement.

The $2.56 billion for ongoing operations, according to a memo prepared by the FDIC’s chief financial officer, is due to two things: targeted staffing increases approved in 2023 and proposed for 2024; and scheduled salary and benefit increases under the existing compensation agreement with the FDIC’s employee union.

“Most of the proposed new positions are intended to strengthen the FDIC’s ability to monitor and oversee the risks in and, if necessary, resolve the failure of large and complex insured depository institutions (IDIs),” the memo states. “In many cases, they reflect the lessons learned from the three large regional bank failures earlier this year.”

The 2024 budget includes funding for 6,817 full-time equivalent (FTE) positions (6,486 permanent, 331 non-permanent), which is a net increase of 189 positions from the currently authorized 2023 staffing level, the memo notes.

FDIC Approves 2024 Operating Budget