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Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

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Re: Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

#61

Post by mgraczyk »

hn_throwaway_99 wrote: post #40

Yellen and the FDIC is in a tough spot. This is the important line, "Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law." Thus, on one hand, I'm glad they're doing this, as it should help prevent wider bank runs, and it ensures that banks are the ones that are actually paying for it. At the same time, this is yet another exam…

In cases where you can't predict the future appropriately, sometimes it's better to make prudent decisions that help everyone instead of attempting to punish the sinful.

Keep in mind that bank shareholders and senior management are going to get wiped out and fired.

Re: Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

#64

Post by loeg »

ZachPruckowski wrote: post #17

> "Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law." Very curious to see who ends up paying this special assessment. Are we all going to pay in lower deposit/investment interest from banks? Are bank shareholders/profits gonna eat it?

The balance sheet hole is likely to be relatively small.

> Are we all going to pay in lower deposit/investment interest from banks? Are bank shareholders/profits gonna eat it?

Some combination of this, I think.

Re: Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

#65

Post by jachee »

kqr2 wrote: post #52
mkmk wrote: post #6

“After receiving a recommendation from the boards of the FDIC and the Federal Reserve, and consulting with the President, Secretary Yellen approved actions enabling the FDIC to complete its resolution of Silicon Valley Bank, Santa Clara, California, in a manner that fully protects all depositors. Depositors will have access to all of their money starting Monday, March 13. No losses associated with the resolution of S…

This special fee will most likely be passed onto bank account holders either through lower interest rates or higher fees, so most taxpayers with bank accounts will likely be affected indirectly.

Wonder how it applies, if at all, to credit unions.

Re: Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

#67

Post by notmindthegap »

hn_throwaway_99 wrote: post #40

Yellen and the FDIC is in a tough spot. This is the important line, "Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law." Thus, on one hand, I'm glad they're doing this, as it should help prevent wider bank runs, and it ensures that banks are the ones that are actually paying for it. At the same time, this is yet another exam…

Did you foresee this?

Re: Joint statement by the Department of the Treasury, Federal Reserve, and FDIC

#69

Post by fortenforge »

hn_throwaway_99 wrote: post #40

Yellen and the FDIC is in a tough spot. This is the important line, "Any losses to the Deposit Insurance Fund to support uninsured depositors will be recovered by a special assessment on banks, as required by law." Thus, on one hand, I'm glad they're doing this, as it should help prevent wider bank runs, and it ensures that banks are the ones that are actually paying for it. At the same time, this is yet another exam…

There is some sense in which this is true, but the systemic risk exception which they are invoking was always on the books.
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