US officials study ways to expand FDIC coverage to all deposits -Bloomberg News | Inquirer Business

US officials study ways to expand FDIC coverage to all deposits -Bloomberg News

/ 11:30 AM March 21, 2023

U.S officials are looking at ways to temporarily expand Federal Deposit Insurance Corp (FDIC) coverage to all deposits, Bloomberg News reported on Monday.

U.S. Treasury Department staff are studying whether federal regulators have enough emergency authority to insure deposits above the current $250,000 cap on accounts without the consent of Congress, the report said, citing people familiar with the matter.

One legal framework that is being looked at for expanding FDIC insurance would use the Treasury Department’s authority to take emergency action and lean on the Exchange Stabilization Fund, the report added.

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Authorities do not see such a move as a necessity yet, especially after regulators took steps this month to help banks keep up with any demands for withdrawals, but they are still developing a strategy out of due diligence in case the situation worsens, according to Bloomberg.

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“Due to decisive recent actions, the situation has stabilized, deposit flows are improving and Americans can have confidence in the safety of their deposits,” a U.S. Treasury spokesperson told Bloomberg.

Treasury had no immediate comment on the report when contacted by Reuters.

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READ MORE:

Midsize US banks ask government to protect all deposits: report

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