Support our non-partisan non-profit newsroom 💜 Donate now

FDIC needs to find way out of hole

Steve Henn Sep 29, 2009
HTML EMBED:
COPY

FDIC needs to find way out of hole

Steve Henn Sep 29, 2009
HTML EMBED:
COPY

TEXT OF STORY

Bill Radke: The Federal Deposit Insurance Corporation — the FDIC — is short on cash. Now the Treasury is standing behind it, so your bank account is safe. But as Marketplace’s Steve Henn reports, the FDIC needs to find a way out of its hole, and the board is meeting today.


Steve Henn: It’s cost the FDIC $14 billion to shut down 50 banks in the last three months.

Bert Ely is a banking consultant:

Bert Ely: This situation is turning out to be much more expensive in terms of disposing of failed banks than I think anybody had anticipated.

Lately the FDIC jacked bank premiums to cover its losses. Bill Black, a former bank examiner, says that weakens banks:

Bill Black: Banks that are well run end up paying eventually a very heavy price.

Some suggest the FDIC borrow money from healthy banks. Black says it’s time for the U.S. Treasury to bail out an FDIC that’s flat broke.

In Washington, I’m Steve Henn for Marketplace.

There’s a lot happening in the world.  Through it all, Marketplace is here for you. 

You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible. 

Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.