An update on the agency’s Deposit Insurance Fund (DIF) restoration plan and proposals related to the Change in Bank Control Act are the two discussion items on tap for Thursday’s open meeting of the Federal Deposit Insurance Corp. (FDIC) Board, according to the agency’s online notice.
The meeting is slated for 10 a.m. and will be open to the public only by webcast, the agency said.
The semiannual update on the DIF restoration plan is the first of 2024 and follows the last update provided in December. The agency then decided that despite a sizeable drop in the fund’s reserve ratio as of last June, it would make no change in assessment rates paid by banks.
In December, the FDIC reported the DIF with a reserve ratio of 1.11% as of June 2023 – down from 1.25% at year-end 2022. The decline was attributed to increased loss provisions, including for three bank failures last year, coupled with strong insured deposit growth.
To address those three failures – of Silicon Valley Bank (SVB) of Santa Clara, Calif., and Signature Bank of New York, N.Y., in March 2023 and First Republic Bank of San Francisco in May – the board in November approved a special assessment on 114 banks having large amounts of uninsured deposits.
In December, the agency said it expected that the DIF ratio is likely to reach its statutory minimum of 1.35% by the statutory deadline of Sept. 30, 2028.
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