I. Financial Results - Fourth Quarter 2020
Deposit Insurance Fund (DIF)
- The DIF’s comprehensive income totaled $7.5 billion for 2020 compared to comprehensive income of $7.7 billion during 2019. While assessment revenue increased year-over-year by $2.2 billion, this was fully offset by a year-over-year reduction in the negative provision for insurance losses of $1.1 billion and a decrease in interest and unrealized gains on U.S. Treasury securities of $1.2 billion.
- The provision for insurance losses was a negative $157 million for 2020, compared to negative $1.3 billion for 2019. The negative provision of $157 million in 2020 reflected adjustments to loss estimates for prior year failures largely as a result of unanticipated recoveries from professional liability claims and litigation settlements by receiverships, as well as reductions to receivership future liquidation expense estimates. The provision balance for 2019 reflected much larger decreases in loss estimates for prior year bank failures primarily arising from shared-loss liability reductions as well as unanticipated recoveries from litigation settlements and professional liability claims by receiverships.
- Interest revenue on U.S. Treasury securities for 2020 was $1.7 billion, compared to $2.1 billion in 2019. The $0.4 billion year-over-year decrease resulted from reinvestment at record low yields even though the investment in U.S. Treasury securities was $10.4 billion larger at year-end 2020 than year-end 2019.
- During 2020, the DIF recognized an unrealized gain on U.S. Treasury securities of $483 million, down from a $1.2 billion unrealized gain in 2019. This decline is due to the fact that a significant portion of the securities in the portfolio with unrealized gains matured during 2020 (or will do so in the first quarter of 2021).
- During December, the DIF recognized assessment revenue of $1.9 billion for the estimate of fourth quarter 2020 insurance coverage. Additionally, the DIF recognized a $69 million adjustment for lower-than-estimated collections for the third quarter 2020 insurance coverage, which decreased assessment revenue.
- On December 30, 2020, the FDIC collected $1.8 billion in DIF assessments for third quarter 2020 insurance coverage.