The levy would be collected over eight quarters beginning in June 2024, but could be adjusted as the estimated losses to the insurance fund change. Banks with less than $5 billion in assets would not pay any fee. While the fee applies to all banks, in practice it would affect lenders with more than $50 billion in assets, which would cover over 95% of the cost, the agency said. The bank regulator will apply a "special assessment" fee of 0.125% to the uninsured deposits of lenders in excess of $5 billion, based on the amount of uninsured deposits a bank held at the end of 2022, the FDIC proposed at a board meeting. lenders will bear the cost of replenishing the $16 billion hit to a key deposit insurance fund caused by recent bank failures, the Federal Deposit Insurance Corporation (FDIC) said on Thursday.
REUTERS/Rick Wilking/File PhotoĪround 113 of the largest U.S. Signs explaining Federal Deposit Insurance Corporation (FDIC) and other banking policies are shown on the counter of a bank in Westminster, Colorado November 3, 2009. "If inflation falls pretty quickly, as financial markets now expect he said, "one might imagine interest rates normalizing, the yield curve uninverting and then the pressure on banks and their deposit bases becomes much much smaller." "If inflation is going to stay high and it's embedded in our economy, and we have to run tight monetary policy and an inverted yield curve for an extended period of time, that creates real problems for banks of all sizes. "The real question is, when is inflation going to come down," he said. There is some evidence high inflation "is coming down, but so far it's been pretty darn persistent - that means we are going to have to keep at it for an extended period of time," Kashkari said during an event at Northern Michigan University in Marquette, Michigan.
REUTERS/ Ann Saphir/File PhotoĪn extended period of high interest rates and an inverted yield curve could put more stress on banks, but would be necessary if inflation stays stubbornly high, Minneapolis Federal Reserve President Neel Kashkari said on Thursday.
Minneapolis Federal Reserve Bank President Neel Kashkari poses during an interview with Reuters in his office at the bank's headquarters in Minneapolis, Minnesota, U.S., January 10, 2020.
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