FDIC's Reserve Ratio exceeds minimum, large bank surcharges to end

This story appeared in Bank Digest.                                   

The Deposit Insurance Fund Reserve Ratio has reached 1.36 percent, exceeding the statutorily required minimum reserve ratio of 1.35 percent ahead of the Sept. 30, 2020, deadline required under the Dodd-Frank Act. As a result, surcharges on insured depository institutions with total consolidated assets of $10 billion or more (large banks) will cease and small banks will receive assessment credits for the portion of their assessments that contributed to the growth in the reserve ratio from between 1.15 percent and 1.35 percent, to be applied when the reserve ratio is at or above 1.38 percent.

The Federal Deposit Insurance Corporation said the last quarterly surcharge will be reflected in large banks' December 2018 assessment invoices, which cover the assessment period from July 1 through September 30.

The agency's guidance included links to four documents: (1) Final Rule on Assessments (large bank pricing) (2) Final Rule on Assessments (surcharges); (3) Final Rule on Assessments (small bank pricing); and (4) Third Quarter 2018 "Quarterly Banking Profile".