ICBA urged the FDIC to exempt community banks from any special assessment to recover Deposit Insurance Fund losses caused by the failures of Silicon Valley Bank and Signature Bank of New York.
ICBA Letter: In a national news release and letter to FDIC Chairman Martin Gruenberg, ICBA President and CEO Rebeca Romero Rainey said:
Large banks should pay for the special assessment because they are the chief potential beneficiaries of these two receiverships and the FDIC’s decision to cover any losses of their uninsured depositors.
Gruenberg affirmed to Congress that the Federal Deposit Insurance Act provides the FDIC much discretion regarding the design and timeframe for any special assessment and requires the agency to consider the types of entities that benefit from its actions.
A January 2023 ICBA letter to the FDIC warned that large financial institutions rely on high concentrations of uninsured deposits, reflecting why they should pay significantly more for deposit insurance.
Background: ICBA has said since the immediate aftermath of the SVB and Signature failures that Washington’s response should not affect the community banks that continue to appropriately manage risk and do right by their customers.
Industry Differentiation: In a recent blog post and video to community bankers, ICBA President and CEO Rebeca Romero Rainey said round-the-clock media outreach, the ICBA National Campaign, and focused advocacy efforts are helping to differentiate community banks from larger financial institutions among policymakers and the public.