Moving FDIC insurance to an asset-based assessment system: Evidence from the special assessment of 2009
In the second quarter of 2009, the FDIC imposed a special assessment on insured banks to replenish the deposit insurance fund. While the traditional assessment base for regular deposit insurance premiums was all insured deposits, the special assessment was applied to a bank's total assets minus Tier 1 capital (total liabilities), with the maximum ‘capped’ at 10 basis points of insured deposits. We find that the cap yielded the greatest savings for banks with assets above $10 billion and that the FDIC would have raised a substantially greater amount of funds using holding company adjusted assets or could have applied a lower assessment rate to collect the same amount of proceeds.
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Volume (Year): 64 (2012)
Issue (Month): 1 ()
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- Robert A. Eisenbeis & Larry D. Wall, 2002. "Reforming deposit insurance and FDICIA," Economic Review, Federal Reserve Bank of Atlanta, issue Q1, pages 1-16.
- Veronesi, Pietro & Zingales, Luigi, 2010.
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Elsevier, vol. 97(3), pages 339-368, September.
- Pietro Veronesi & Luigi Zingales, 2009. "Paulson's Gift," NBER Working Papers 15458, National Bureau of Economic Research, Inc.
- Veronesi, Pietro & Zingales, Luigi, 2009. "Paulson's Gift," CEPR Discussion Papers 7528, C.E.P.R. Discussion Papers.
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