FDIC staff propose extending guarantee, fee change

WASHINGTON, April 13 (BestGrowthStock) – U.S. bank regulators are
considering extending a crisis-era guarantee of business
accounts for six months and changing the fee system for large
banks.

The staff of the Federal Deposit Insurance Corp recommended
on Tuesday that the agency extend the so-called Transaction
Account Guarantee (TAG) program to ensure that community banks
still relying on the government backing do not lose business
accounts to larger banks that could be perceived as more
stable.

The staff also recommended changing the factors used to
determine how much large banks pay for deposit insurance.

The FDIC board is expected to vote shortly on the
proposals.

The fee proposal would try to capture long-term risks by
including stress testing, underwriting standards, and risk
management as factors in fee levels.

The changes would apply to large banks with more than $10
billion in assets, which includes a little more than 100
banks.

It would also create a separate category for “highly
complex institutions” that have a depository bank with $50
billion in assets, and a holding company with $500 billion in
assets. That includes about nine banks, the FDIC said.

Those institutions would face four other measures that
would factor into fee levels, including senior bond spreads and
the parent company’s tangible common equity.
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(Reporting by Karey Wutkowski; Editing by Tim Dobbyn)

FDIC staff propose extending guarantee, fee change