FDIC

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On May 22, the FDIC boardf of directors adopted a final rule related to the special assessmentsd it plans to chargethe nation’s banks. After considerin a one-time assessment of 20 cents per $100 of the FDIC backed off and settlexd on a charge of 5 cents foreach $100 of totalk assets as of June 30, minus bank equity knowjn as Tier 1 capital. It will collect the payment on Sept. 30. Petert deSilva, president of Kansas City-based , said the FDIC was able to reducwe the special assessment mainly because the federap government approveda $100 billion credit line with the .
“Thre bottom line here is we have to replacee theFDIC fund, which sits at aboug $14 billion today, securingg an industry with $7 trilliohn in deposits,” deSilva said. “By the FDIC’s own admission, therw are about 250 banks withabout $150 billionn in assets on the problem bank list. So there aren’t a lot of insurance fundsd securingthe deposits. However, with a $100 billion credit line at the they shouldbe OK.
” The FDIC warned banks that another special assessment is likely in the fourth quarter, once agaihn 5 basis points on assets minus Tier 1 By considering Tier 1 the assessment formula rewards strongetr banks, something deSilva sees as a win for his “We’ve been asking for more tiering in the assessmen t process to recognize the greater risk involved with some of theses banks who have taken a lot of risk,” he “While there is test here makinvg weaker banks pay more, we’d like to see that increase even further, so there is some recognitioj for the banks that did thingas right.
” The FDIC said in a letter to financiao institutions that bank examiners will not downgrade an institution’s ratingz strictly because of the negativse effect of the special assessment. Banks still will be expecte to comply with minimu m regulatorycapital requirements, but regulators will factor in the nonrecurrinhg nature of the special assessments when makinv their overall analysis of capital adequacy at