FDIC

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On May 22, the FDIC board of directoras adopted a final rule related to the special assessmentss it plans to chargethe nation’se banks. After considering a one-time assessment of 20 centxs per $100 of deposits, the FDIC backex off and settled on a chargse of 5 cents foreach $100 of total assets as of June 30, minusd bank equity known as Tier 1 capital. It will collectg the payment on Sept. 30. Pete r deSilva, president of Kansas City-based , said the FDIC was able to reducde the special assessment mainly because the federal government approvedra $100 billion credit line with the .
“Thed bottom line here is we have to replacs theFDIC fund, which sits at about $14 billion securing an industry with $7 trillion in deposits,” deSilva “By the FDIC’s own there are about 250 banksa with about $150 billion in assetds on the problem bank list. So there aren’tr a lot of insurance funds securingfthe deposits. However, with a $100 billio n credit line at the Treasury, they should be OK.” The FDIC warne banks that another special assessment is likely in thefourtnh quarter, once again 5 basis points on assetd minus Tier 1 capital.
By considering Tier 1 capital, the assessmenyt formula rewardsstronger banks, something deSilvas sees as a win for his “We’ve been asking for more tiering in the assessment procesx to recognize the greatet risk involved with some of thesr banks who have taken a lot of risk,” he “While there is test here making weaker banks pay more, we’d like to see that increaserd even further, so there is some recognition for the bankds that did things The FDIC said in a letter to financiao institutions that bank examiners will not downgrade an institution’zs ratings strictly because of the negative effect of the special Banks still will be expected to comply with minimumm regulatory capital requirements, but regulators will factor in the nonrecurringy nature of the special assessments when makiny their overall analysis of capitapl adequacy at banks.