Deposit Insurance Assessments

The FDIC Board of Directors has proposed the attached revisions to the FDIC's regulation governing deposit insurance assessments and is seeking comment on the proposal. The Board believes the proposed changes will enhance the present system by allowing institutions with improving capital positions to benefit from the improvement more quickly, while requiring those whose capital is falling to pay a higher assessment sooner. Comments on the proposal are due by October 25, 1999.

Specifically, the Board is proposing that the FDIC's assessment regulation (Part 327) be amended to:

• base capital group determinations under the FDIC's risk-based assessment system on Call Report data for the quarter ending three months before the beginning of the assessment period, instead of six months as at present;
• shorten the required notification period from 30 days to 15 days prior to each assessment period's payment date;
• increase from 30 days to 90 days the time in which an institution may request a review of its assessment risk classification; and
• recognize administrative changes internal to the FDIC that have already taken place.

For more information, please contact James W. Thornton, Senior Banking Analyst in the Division of Insurance (DOI), at (202) 898-6707 or Richard Jones, Chief of DOI's Assessments Implementation Section, at (202) 898-6592.

Attachment:  Federal Register, September 8, Vol. 64, No. 172, pages 48719-48721
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Distribution:   FDIC-Insured Banks

NOTE: Paper copies of FDIC financial institutions letters may be obtained through the FDIC's Public Information Center, 801 17th Street, NW, Room 100, Washington, DC 20434 (800-276-6003 or (703) 562-2200).