FDIC Proposes Deposit Account Recordkeeping Rule

The FDIC today issued a proposal requiring banks with more than 2 million deposit accounts to upgrade their deposit recordkeeping systems to facilitate the determination of FDIC insured deposits in the event of a bank failure. The FDIC would use the failing bank’s systems, data and staff to calculate the insured and uninsured amounts for each depositor and place holds on portions of uninsured deposits.

The proposal — which would affect 36 of the nation’s largest institutions — would require the banks to collect and maintain more depositor information and make changes to information systems so that prompt and accurate determinations could be made regarding FDIC insurance.

“Enhancing their internal systems to be responsible for determining what is and isn’t insured will involve significant staff time and cost for the banks subject to the final rule,” said ABA senior economist Rob Strand. He added that it is critical the FDIC give banks a reasonable amount of time to implement the system upgrades.

The FDIC will accept comments on the proposal for 90 days after publication in the Federal Register. For more information, contact ABA’s Rob Strand.