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Press Release

FDIC Issues Proposed Rule Regarding Deposit Insurance Simplification

Tuesday, July 20, 2021

For Release

WASHINGTON — The Federal Deposit Insurance Corporation (FDIC) today issued a proposed rule to simplify aspects of the agency’s deposit insurance coverage rules.

First, the proposed rule would simplify deposit insurance coverage for deposits held in connection with revocable and irrevocable trusts by merging these two deposit insurance categories and applying a simpler, common calculation to determine coverage for all trust accounts. Currently, the FDIC receives more inquiries related to deposit insurance coverage for trust deposits than all other types of deposits combined. The proposal would make the trust rules consistent and easier to understand for bankers and depositors, and also would facilitate prompt payment of deposit insurance by the FDIC in the event of an insured depository institution’s failure.

Additionally, the proposal would amend the rule that governs coverage for mortgage servicing accounts to allow principal and interest funds advanced by a mortgage servicer to be included in the deposit insurance calculation.

Comments on the proposed rule will be accepted for 60 days after publication in the Federal Register.

FDIC: PR-66-2021