| The FDIC Board of Directors
voted on November 26, 1996, to retain the existing Bank Insurance
Fund (BIF) assessment schedule of 0 to 27 basis points (annual rates)
for the first semiannual period of 1997, and to collect an assessment
against BIF-assessable deposits to be paid to the Financing Corporation
(FICO). In addition, the Board eliminated the $2,000 minimum annual
assessment and authorized the refund of the fourth-quarter minimum
assessment of $500 paid by certain BIF-insured institutions on September
30, 1996. Details of the Board's action will be included in a forthcoming
Federal Register notice.
Assessment Rate
As a result of the Board's action, BIF assessment
rates will continue to range from 0 to 27 basis
points. The difference between the existing
rate schedule and the schedule placed in effect
for the January 1, 1997, assessment period is
that the new schedule will no longer include
a reference to a minimum assessment amount.
This change results from the recently enacted
Deposit Insurance Funds Act of 1996 (Funds Act),
which eliminated a statutorily-imposed minimum
assessment amount. With this modification, the
new rate schedule will result in an estimated
average annual assessment rate of approximately
0.17 basis points; the estimated annual revenue
produced by this rate schedule will be approximately
$43 million.
In connection with the elimination of the
mandatory minimum assessment amount, the Board
has decided to refund the $500 minimum assessment
paid to the BIF by certain institutions for
the fourth quarter of 1996. Any refund due,
including interest, will be reflected in the
invoices to be mailed on December 11, 1996,
and will be netted against any assessments due
for the first quarter of 1997. Collection will
take place on January 2, 1997.
FICO Assessment
| The Funds Act authorizes the FICO to levy
assessments on BIF-assessable deposits and stipulates
that the rate must equal one-fifth the FICO
assessment rate that is applied to deposits
assessable by the Savings Association Insurance
Fund (SAIF). The actual assessment rates for
FICO will be determined by deposit data from
the September 30, 1996, Call Reports, when processing
is completed. Based on June 30, 1996, deposit
data, the upcoming assessment invoice would
reflect a FICO rate of approximately 1.29 basis
points, on an annual basis, for BIF-assessable
deposits, and approximately 6.44 basis points
for SAIF-assessable deposits. Invoices for FICO
assessments will be mailed with BIF and SAIF
invoices on December 11, 1996, and collection
for FICO will take place via direct debit on
the same collection date established for BIF
and SAIF assessments, January 2, 1997.
Questions regarding these matters should be
directed to the FDIC's toll-free Assessment
Hotline at 1-800-759-6596 (202-898-7090 in the
Washington, D.C., area) between 8:30 AM and
4:30 PM, Eastern Time. |
|
Nicholas J. Ketcha Jr.
|
|
Director |
Distribution: Insured Commercial Banks and
FDIC-Supervised Savings Banks
Note: Paper copies of FDIC financial institution
letters may be obtained through the FDIC's Public
Information Center, 801 17th Street, N.W., Room
100, Washington, D.C. 20434 ((703) 562-2200)
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