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Federal Deposit
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Each depositor insured to at least $250,000 per insured bank

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Chief Financial Officer's (CFO) Report to the Board

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I. Corporate Fund Financial Statement Results - Fourth Quarter 2008

Deposit Insurance Fund (DIF)

  • The accounting for the transactions of the TLGP will have no impact to the DIF. Any losses incurred by the DIF will be recovered from fees collected from participating institutions in the TLGP as well as any special assessments imposed on all insured depository institutions. Fees received/accrued by FDIC as a result of the program will be held in reserve (deferred revenue) and used solely for the payment of any losses arising from the program. However, when losses are recognized the amount will be charged to expense and an equal amount of deferred revenue will be recognized as revenue to cover the loss.
  • For 2008, the DIF’s comprehensive loss was $33.524 billion compared to comprehensive income of $2.248 billion during 2007. This year-over-year decrease of $35.772 billion was primarily due to a $40.131 billion increase in the provision for insurance losses offset in part by a $2.322 billion increase in assessment revenue; a $1.766 billion increase in the unrealized gain on available-for-sale securities; and a $775 million increase in the realized gain on sale of securities.
  • The provision for insurance losses was $40.226 billion in 2008. The total provision consists mainly of the provision for future failures ($22.244 billion) and the losses estimated at failure for the 25 resolutions occurring during 2008 ($17.873 billion), the largest of which was the $10.725 billion estimated loss for the IndyMac resolution.
  • Assessment revenue was $2.965 billion for 2008 compared with $643 million for 2007. This increase of $2.322 billion was mostly due to the reduction in the amount of one-time assessment credits available for use. In 2008, $1.446 billion in one-time credits offset $4.410 billion in gross assessment premiums; whereas in the previous year, $3.088 billion in one-time credits were applied against $3.731 billion in gross assessment premiums.
  • Net receivables from resolutions increased by $1.352 billion to $15.766 billion during the fourth quarter of 2008. This increase was mostly due to an increase of $2.360 billion in net subrogated accounts (claims against the receivership) for the 12 failures in the fourth quarter and $1 billion in funding provided to the IndyMac conservatorship. Partially offsetting these increases was a $1.825 billion increase in the allowance for loss on the IndyMac resolution.

FSLIC Resolution Fund (FRF)

  • FRF’s net loss was $63 million for the fourth quarter of 2008 compared to a $74 million net loss during the prior quarter. The net loss was primarily due to the recognition of $87 million in losses for three Goodwill judgments, offset by $17 million in tax benefit recoveries.

Last Updated 03/16/2009

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