Executive Summary - Second Quarter 2023
The attached report highlights the FDIC’s financial activities and results for the quarter ended June 30, 2023.
- During the second quarter of 2023, the Deposit Insurance Fund (DIF) balance increased to $117.0 billion as of June 30, 2023, up $897 million from the March 31, 2023 balance of $116.1 billion. The quarterly increase was primarily due to assessment revenue of $3.1 billion partially offset by an increase in the provision for insurance losses of $2.0 billion. The increase in provision for insurance losses represents the difference between the First Republic Bank's initial loss estimate recorded as of May 2023, and the related contingent liability for anticipated failures at March 2023.
- Insured deposits increased by 0.8 percent during the second quarter and more than offset the growth of the DIF balance. As a result, the reserve ratio fell by one basis point to 1.10 percent.
- During the second quarter of 2023, the FDIC was named receiver for one failed institution, First Republic Bank. The assets at inception for First Republic totaled approximately $230 billion. The corporate cash outlay during the second quarter for this institution was $10.0 billion. The cost estimate for the sale of First Republic to JP Morgan Chase Bank has been revised from the original estimate of $13.0 billion to approximately $15.6 billion, primarily due to an increase in the amount of liabilities assumed by the acquirer. Loss estimates are periodically adjusted as assets are sold, liabilities are satisfied, and receivership expenses are incurred.
- Through June 30, 2023, overall FDIC Operating Budget expenditures were below the year-to-date budget by about $201 million, or 15 percent. This variance reflects underspending of $131 million (12 percent) in the Ongoing Operations budget component and $72 million (31 percent) in the Receivership Funding budget component. Ongoing Operations expenditures were at or below 85 percent of the YTD budget in every non-salary expense category. Receivership Funding expenditures were under the YTD budget primarily due to delays in the payment of settlement expenses associated with the failures of Silicon Valley Bank and Signature Bank in March and First Republic Bank in May.