ACB: Press Releases

Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release March 7, 2001 #01-18
E-mail: [email protected]

FDIC’S DEPOSIT INSURANCE PLAN CLOSELY TRACKS ACB’S RECOMMENDATIONS

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Statement by Diane M. Casey, president, America’s Community Bankers, on FDIC Chairman Donna Tanoue’s remarks on deposit insurance reform:

Chairman Tanoue’s outline of the FDIC’s plan for deposit insurance reform closely tracks many of ACB’s recommendations. While the details will be critical in determining how the reforms will impact community banks, it is clear the FDIC took into account the comments submitted in developing its recommendations.

ACB believes the most important reforms to be undertaken immediately are: merging the insurance funds to enhance their future stability; dealing with excessive deposit growth as highlighted by the movement of billions of uninsured dollars into insured bank accounts; and providing flexibility to meet the 1.25 percent reserve ratio over time so that the FDIC is not forced to impose high premiums during bad economic times.

All of these were among the areas of reform listed by the FDIC. We were pleased that Chairman Tanoue indicated support for indexing the limit on insurance coverage while opening the public policy debate on the starting point for the indexing. That’s an issue on which there are many points of view deserving full and complete debate. Based on the recommendations of ACB’s community bank members, we support indexing for inflation from 1974, which would increase coverage level to about $140,000 today.

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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