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>FDIC insurance is now effectively infinite. That clearly being the case, what does it mean for insurance premiums?
by hypothesis 4y ago
>FDIC insurance is now effectively infinite.
That clearly being the case, what does it mean for insurance premiums?
- hn_throwaway_99 4y agoThis is from the top HN post: > Shareholders and certain unsecured debtholders will not be protected. Senior management has also been removed. Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law.
- hypothesis 4y agoSo, going forward, are they planning to do a “special assessment” for every failure? Because before banks were paying premiums into the system, just like an insurance.
- junofan 4y agoYes, the premiums are called assessments.
- hypothesis 4y agoOk, that makes sense. My question was more about mechanics of this. Do they plan to keep FDIC fund and grow it or maybe you wind it down and just assess “as needed”, since the other guy is now completely on the hook.
- dkjaudyeqooe 4y agoNo insurance premiums will reflect estimated risk of total bank failures going forward.