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That's a bold statement and not in line with FDIC actions for previous bank failures.
by funstuff007 4y ago
That's a bold statement and not in line with FDIC actions for previous bank failures.
- calgarymicro 4y agoIs it not? Most of the time the FDIC will find a buyer and guarantee some percentage (usually ~80%) of all losses to the purchasing bank (plus the very low upfront purchase price, of course) in exchange for them honoring all deposits. So ensuring most deposited funds are safe, at least in the long term, seems to be in line with their usual playbook, even if the unusual circumstances around this particular failure might make that less likely.
- zrail 4y ago> in 55 failures since IndyMac of banks with total deposits over $1 billion, uninsured deposits were fully protected against any loss. The largest failure, Colonial Bank, had $20 billion of deposits, including an estimated $4.4 billion of uninsured deposits. https://www.cato.org/commentary/fdic-invents-costly-solution-imaginary-problem https://www.cato.org/commentary/fdic-invents-costly-solution...
- SecretDreams 4y agoMeanwhile, svb had north of 160bik deposits with an estimated 93% uninsured. Scope is a bit different.
- zrail 4y agoThe article goes on to note that when FDIC wound up Wachovia in 2008 there were $130Bil in uninsured deposits and all of them were made whole.