FDIC wants banks bigger than $5B to pay for SVB and Signature failures: FDIC Knows they have no money. SHTF.

via YAHOO:

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Giant banks and regional lenders with more than $5 billion in assets will help pay for the March failures of Silicon Valley Bank and Signature Bank, according to a new proposal from the Federal Deposit Insurance Corporation, sparing small community institutions from footing part of the bill.

The FDIC now estimates that it will cost $15.8 billion for it to protect all depositors at those two institutions who were above the FDIC’s $250,000-per account insurance level. It took that step to prevent a wider panic in the financial system.

The FDIC typically replenishes its Deposit Insurance Fund with quarterly fees paid by all FDIC-insured banks. This time it is levying a special assessment to recover losses associated with the uninsured depositors and thus has more flexibility to decide which banks should contribute most.

The proposal it announced Thursday asks the largest banks – those with total assets over $50 billion — to pay more than 95% of the special assessment.

A total of 113 banks would pay something. The overwhelming majority – some 96%, or roughly 4,500 banks — wouldn’t pay anything.

 

h/t Hephaestus4

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