WASHINGTON–The FDIC has approved a bank deposit insurance assessment rate schedule that will increase uniformly by two basis points beginning in the first quarterly assessment period.
The board, which adopted the final rule as it was proposed in June, said the revised rate schedules will be effective on Jan. 1 and applicable to the first quarterly assessment period of 2023 (i.e., Jan. 1 through March 31, 2023, with an invoice payment date of June 30).
The NCUA board earlier this year voted against any assessment increase for credit unions.
According to the agency, it is projecting the assessment rates increase would have an “insignificant effect” on institutions’ capital levels. It is estimating the change will reduce income slightly by annual average of 1.2% and should not “impact lending or credit availability in any meaningful way.”
The FDIC said the final rule is intended to increase the likelihood the reserve ratio of the Deposit Insurance Fund (DIF) reaches the statutory minimum of 1.35% by the statutory deadline of Sept. 30, 2028, consistent with the amended restoration plan as adopted by the FDIC Board.
In its statement, it further said the rule also reduces the likelihood that it will need to consider a “potentially pro-cyclical assessment rate increase (i.e., raise assessments when banking and economic conditions may be less favorable).”
Designated Reserve Ratio Maintained
Separately, the board maintained the designated reserve ratio (DRR) of total reserves to savings insured for the DIF at 2% for 2023.
“Growing the DIF increases the likelihood of the DIF remaining positive throughout periods of significant losses due to bank failures, consistent with the FDIC’s long-term fund management plan,” the federal regulator said. “Therefore, the new assessment rate schedules will remain in effect unless and until the reserve ratio meets or exceeds 2%, absent further Board action. Progressively lower assessment rate schedules will take effect when the reserve ratio reaches 2%, and again when it reaches 2.5%.”
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