DIF Reserve Ratio Surpasses 1.38%, Triggering Assessment Credits for Banks Under $10 Billion
Washington, D.C. (Sept. 5, 2019)—Independent Community Bankers of America® (ICBA) President and CEO Rebeca Romero Rainey issued the following statement on today’s Quarterly Banking Profile from the Federal Deposit Insurance Corp.
“Today’s FDIC quarterly data show that community banks are meeting the needs of their local communities and will continue to do so as new deposit-insurance assessment credits take effect for many of these institutions. With the FDIC’s Deposit Insurance Fund reserve ratio surpassing 1.38 percent, banks with less than $10 billion in assets will receive approximately $764 million in ICBA-advocated assessment credits. The FDIC will start applying those credits in September to offset the 2019 second-quarter bank assessments.
“As advocated by ICBA and community bankers, this provision of the Dodd-Frank Act of 2010 required larger banks to offset the cost of increasing the DIF reserve ratio from 1.15 percent to 1.35 percent on banks under $10 billion. These assessment credits will be automatically applied each quarter that the reserve ratio is at least 1.35 percent.
“At the time of the original debate, the Deposit Insurance Fund was in negative territory amid the fallout of the Wall Street financial crisis. Looking at the big picture, ICBA fought hard to ensure that most community banks wouldn’t be stuck footing the cost of a crisis they didn’t cause.
“It’s been a long time coming, but community banks are getting credit where credit is due. ICBA will continue working with policymakers to ensure that community banks and their more than 50,000 locations nationwide have every opportunity to flourish.”
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. With more than 50,000 locations nationwide, community banks constitute 99 percent of all banks, employ nearly 750,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding more than $5 trillion in assets, nearly $4 trillion in deposits, and more than $3.4 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.
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