US officials are considering ways to temporarily extend the Federal Deposit Insurance Corporation (FDIC) coverage of all bank deposits, in a move sought by a coalition of banks they say they need to avert a potential large-scale financial crisis.
The FDIC only insures deposits up to $250,000, but Treasury officials are currently reviewing whether federal regulators have emergency authority to insure deposits of more than $250,000 in most accounts without formal approval from a divided Congress. strongly about this.
Officials familiar with the matter said, in statements, that the authorities do not view this step now as necessary, especially after federal regulators took steps this month to help banks keep pace with any requests to withdraw funds, but they are nevertheless working on developing a strategy in case the situation worsens.
“We will use every possible means we have to support the banking community,” White House spokesman Michael Kikukawa said. “Since our administration and regulators took decisive action last weekend, we’ve seen stability in deposits at regional banks across the country.”
It should be noted that the Federal Deposit Insurance Corporation is an agency independent of the federal government, created in 1933 in response to thousands of bank failures that occurred in the 1920s and early 1930s, and is headquartered in Washington, D.C., and has established regional and field offices throughout the states United.
The institution directly supervises more than 5,000 banks and savings associations, and examines them to ensure the integrity of their work, and it plays a major role in preserving the stability and confidence of citizens in the financial system of the United States, the largest economy in the world, and to achieve this goal, it has sought to adopt several mechanisms, most notably Deposit insurance, examination and supervision of financial institutions in order to ensure their safety and consumer protection.
The FBI typically insures deposits up to $250,000 per client account, but its funds will be fully mobilized to protect uninsured deposits if the Treasury Secretary so decides.
