FDIC proposes raising deposit insurance assessment rates by 2 basis points

The Federal Deposit Insurance Corp.'s board on June 21 issued a notice of proposed rulemaking to raise deposit insurance assessment rates by 2 basis points for all insured depository institutions.

In doing so, the FDIC aims to increase the likelihood that the reserve ratio of the Deposit Insurance Fund reaches its statutory minimum of 1.35% by the September 2028 deadline.

The FDIC board also adopted an amended restoration plan incorporating the assessment rate increase.

The fund balance fell during the first quarter by $100 million to $123 billion, its first decline in over a decade, and the fund reserve ratio declined 4 basis points from the previous quarter to 1.23%, the FDIC's latest Quarterly Banking Profile showed.

The proposed assessment rate schedules would start with the first assessment period of 2023 and remain effective unless and until the reserve ratio meets or exceeds 2%, according to a news release.

Public comments on the proposed rule may be made through Aug. 20.