The American Bankers Association and five trade associations reiterated their opposition to a proposed two basis point increase in deposit insurance assessment rates in comments submitted to the FDIC today, this time citing new filing data which they say shows the increase is unwarranted.
The FDIC signaled in June that it intended to increase assessment rates beginning with the first quarterly assessment period of 2023. The six associations had previously raised concerns about the proposal in comments filed in August. Since then, the agency has released its latest quarterly banking profile, which shows that the decline in deposit levels, including insured deposit levels, is well underway, the groups said in their follow-up letter. The groups also said that rising inflation and interest rates would likely further slow the growth of insured deposits, and that continuing to raise the valuation rate amid these other economic stressors would hurt to the economy.
“The most recent data makes the case against an impending increase in deposit insurance assessment rates even more compelling and we encourage the FDIC not to implement any at this time,” the groups said.