FDIC Might Ask Big Banks to Plug $23 Billion Hole

The FDIC is considering a special assessment on big banks to cover a $23 billion shortfall in its Deposit Insurance Fund, following recent bank failures. This move has led to a mixed reaction from investors, with some bank stocks experiencing minor declines. The plan has also sparked political debate, particularly from smaller banks and community lenders, who are concerned about the implications of bailing out larger institutions. Lawmakers have been actively discussing this issue in recent hearings.

What is the purpose of the FDIC's Deposit Insurance Fund?

• To provide loans to banks

• To regulate interest rates

• To invest in bank stocks

• To ensure depositors are compensated in case of bank failures

How is the FDIC planning to address the shortfall in the Deposit Insurance Fund?

• By reducing bank regulations

• By imposing a special assessment on banks

• By selling government bonds

• By increasing interest rates

What impact did the FDIC's announcement have on bank stocks?

• Stocks significantly increased

• Stocks slightly decreased

• Stocks were unaffected

• Stocks remained unchanged

Which banks are expected to pay a larger share of the FDIC's special assessment?

• Community banks

• Credit unions

• Larger banks

• Foreign banks

What is the main concern of smaller banks regarding the FDIC's plan?

• They will have to close branches

• They will have to contribute to bailing out larger bank depositors

• They will lose customers

• They will face increased competition