INCREASE FDIC COVERAGE LEVELS ON RETIREMENT ACCOUNTS
In his State of the Union message, President Bush stated, "A good job should lead to security in retirement. I ask Congress to enact new safeguards for 401(k) and pension plans."
Senator Tim Johnson (D-SD), who is poised to introduce bipartisan, comprehensive deposit insurance reform legislation in the Senate, applauded the Bush proposal while appropriately adding, "However, we must recognize that for many Americans, investing the whole egg in the stock market may not make sense. Therefore, I will continue to urge my colleagues to increase the level of deposit insurance coverage, especially for retirement accounts, to allow our citizens to invest their money safely with their local community banks."
FDIC Chairman Donald Powell has strongly recommended that FDIC coverage of retirement account savings be increased to $250,000. As bankers know and regret, this is not the position of either Chairman Greenspan or Comptroller Hawke. This is a major problem. On January 31 we wrote the White House, Treasury Department and Chairman Greenspan citing the President's statement and urging their support of the swift passage of much-needed deposit insurance reform, including substantially increased coverage levels.