• The Federal Deposit Insurance Corporation is the U.S. Government agency that insures funds at U.S. banks.FDIC: FAQ

  In March 2009, Chairman Sheila Bair indicated that the FDIC could be facing insolvency within the year. In addition, the FDIC has announced new one-time emergency fees for member banks to increase the amount in the fund, while seeking a $100 billion credit line from congress.Bloomberg.com: FDIC's Bair Seeks $100 Billion Credit Line, May Cut Banks Fee (March 6, 2009)

• Fast Facts

  1. Created in 1933, during The Great DepressionFDIC: About
  2. 1933: More than 4,000 banks failedFDIC: About
  3. 2008: 25 banks failed/closed by FDICFDIC: Failed Bank List
  4. 2009: 89 banks failed as of September 4FDIC: Failed Bank List
  5. Failed banks are closed on Friday, reopen Sunday under new ownershipSlate.com: Why do banks always fail on Fridays? (August 7, 2008)
  6. Guarantees at least $250,000 for bank accounts and $250,000 for retirement accountsOfficial Site: About the FDIC
  7. Does not secure stocks, bonds, hedge funds or other securitiesPalm Beach Daily News: Be aware of the limits to FDIC (September 6, 2008)
  8. Available funds fell to $18.9 billion in the fourth quarter of 2008Bloomberg.com: Bair Says Insurance Fund Could Be Insolvent This Year (March 5, 2009)
  9. Seeking line of credit from congressBloomberg.com: FDIC's Bair Seeks $100 Billion Credit Line, May Cut Banks Fee (March 6, 2009)
  10. If alternate funding approved, could result in a cut in bank fees for member banksBloomberg.com: FDIC's Bair Seeks $100 Billion Credit Line, May Cut Banks Fee (March 6, 2009)

• Background

  The FDIC was created in the wake of the stock market crash of 1929. In 1933 the corporation was set up to insure depositor's funds in member banks. Banks pay for the fund, which has never received an appropriation from congress in over 75 years. The initial insurance amount was set at $2,500 per depositor. The amount gradually increased with inflation until the most recent change, in 2008, to $250,000 per depositor. 1984 was the first year that the fund paid out more in claims than it took in with premiums from member banks. In 2009 the fund continued to struggle following the closing of 25 banks in 2008.Official Site: About the FDIC

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