Federal Deposit
Insurance Corporation

From: Neena Bansil
Sent: Wednesday, November 05, 2008 1:37 PM
To: Comments
Subject: Assessments - RIN-3064-AD35 

With reference to the proposed rule by FDIC, we request you to please consider the following points before finalizing the rules:

1 .Brokered deposits are a cost-effective funding source that is frequently less expensive than other funding options.

2. Brokered deposits are an important source of liquidity to banks in this economic environment and should not be needlessly discouraged.

3. The 10% brokered deposit threshold and the 20% growth threshold are artificially low.  Neither benchmark is an indication of risk to the deposit insurance fund.

4. The 10% brokered deposit threshold will discourage reasonable brokered deposit use above that amount because banks and examiners will view it as a cap, not a guideline.

The fact that DTC brokered deposits are not eligible for early withdrawal (except in the rare case of death or adjudication of incompetence), assists the banking institution in the event that customers choose to make a “run on the bank” which has occurred and adversely effected insured institutions in the recent past often adding to the probability of failure of the institution.