The FDIC needs to consider the effects on midsize and regional banks as it moves forward with a proposed special assessment to recover the costs of protecting uninsured deposits at Silicon Valley Bank and Signature Bank, a group of 13 House lawmakers said today. In a letter to FDIC Chairman Martin Gruenberg, the lawmakers said the assessment “is not occurring in a vacuum,” as it comes at the same time as banking regulators consider increased capital requirements for banks with more than $100 billion in assets. Among the signatories were House Financial Services subcommittee Chairs Andy Barr (R-Ky.) and Ann Wagner (R-Mo.).
“Combined, those anticipated changes and the special FDIC assessment will have disproportionate and lasting repercussions on borrowers, depositors and communities served by regional banks,” the lawmakers said. “Those banks will be faced with difficult choices of where and how to deploy fewer resources for consumers and customers, and reduced credit opportunities will result.”
The proposed assessment would exempt the first $5 billion in uninsured deposits. The lawmakers said the assessment base should be based on a date no earlier than March 31, 2023, “to ensure an accurate and fair reflection of balances in uninsured deposits that existed at the time of the systemic risk determination.” Senate Banking Committee Chairman Sherrod Brown (D-Ohio) and Sen. J.D. Vance (R-Ohio) expressed similar concerns about the assessment in a July letter to the FDIC.
