Summary: | The FDIC has issued the attached final rule requiring certain large depository institutions to facilitate the process for determining the insurance status of depositors of an insured depository institution in the event of failure. The rule applies only to an estimated 159 "covered institutions," defined as any insured depository institution with at least $2 billion in domestic deposits and either (1) more than 250,000 deposit accounts or (2) total assets over $20 billion, regardless of the number of deposit accounts. The rule takes effect on August 18, 2008, and allows for an 18- month implementation period. |
Highlights:
Continuation of FIL-65-2008 Distribution: Suggested Routing: Note: To receive FILs electronically, please visit http://www.fdic.gov/about/subscriptions/fil.html . Paper copies of FDIC financial institution letters may be obtained through the FDIC's Public Information Center, 3501 Fairfax Drive, E-1002, Arlington, VA 22226 (1-877-275-3342 or 703-562- 2200).
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Financial Institution Letters FIL-65-2008 July 17, 2008 |
Large-Bank Insurance Determination Modernization The Federal Deposit Insurance Corporation (FDIC) has issued the attached final rule relating to deposit insurance modernization. Covered institutions - defined as any insured depository institution with at least $2 billion in domestic deposits and either (1) more than 250,000 deposit accounts or (2) total assets over $20 billion, regardless of the number of deposit accounts - will be required to adopt mechanisms that would, in the event of the institution's failure:
This deposit insurance modernization initiative is necessary for the FDIC to meet its mandates to structure the least costly of all possible resolution transactions and to pay insured deposits "as soon as possible" after an institution fails. Doing so would enable the FDIC to:
The final rule takes effect on August 18, 2008. Covered institutions will have 18 months from the effective date of the rule to comply with its requirements. The final rule provides for accelerated implementation on a case-by-case basis for covered institutions exhibiting signs of financial difficulty, such as those with a composite CAMELS rating of 3, 4 or 5. Covered institutions using deposit software or servicing from a vendor should determine whether vendor-supplied functionality will be provided. The FDIC anticipates that it will receive a number of questions on implementing this rule. Questions and requests for telephone meetings may be submitted via e-mail to depositclaims@fdic.gov . Mitchell L. Glassman Director Division of Resolutions and Receiverships |
Additional Related Topics:
- Deposit Insurance Coverage
- 12 C.F.R. Part 330