Chief Financial Officer's (CFO) Report to the Board
I. Corporate Fund Financial Results - Third Quarter 2017
Deposit Insurance Fund (DIF)
- For the nine months ending September 30, 2017, the DIF’s comprehensive income totaled $7.3 billion compared to comprehensive income of $8.1 billion for the same period last year. This $760 million decline was primarily the result of a $1.3 billion increase in provision for insurance losses (year-to-date 2017 positive $20 million versus year-to-date 2016 negative $1.2 billion) and a $393 million lower contribution to year-to-date comprehensive income from unrealized (loss)/gain on U.S. Treasury securities (year-to-date 2017 unrealized loss of $38 million versus year-to-date 2016 unrealized gain of $355 million), partially offset by a $640 million increase in assessment revenue and a $270 million increase in interest revenue.
- The provision for insurance losses was $20 million for year-to-date 2017, compared to negative $1.2 billion for year-to-date 2016. The provision for 2017 primarily resulted from a decrease of $702 million to the estimated losses for prior year failures offset by a $683 million adjustment for higher-than-anticipated losses at the time of failure for current year failures, as compared to the estimated liability at year-end 2016. Reductions for estimated losses for prior year failures occurred in both periods; however, the decreases in 2016 were approximately 40 percent more than those in 2017 ($702 million for year-to-date 2017 and $1.2 billion for year-to-date 2016).
- During September, the DIF recognized assessment revenue of $2.6 billion. Of this amount, $1.4 billion represented the estimate for the third quarter 2017 insurance coverage and $1.2 billion represented estimated assessment surcharges on banks with $10 billion or more in assets. Additionally, the DIF recognized a $67 million adjustment for lower-than-estimated collections for the second quarter 2017 insurance coverage (regular assessments and surcharges), which decreased assessment revenue.
- On September 29, 2017, the FDIC collected $1.4 billion in DIF regular assessments and $1.2 billion in surcharge assessments for second quarter 2017 insurance coverage.