|
The US Federal Deposit Insurance Corporation announced a Temporary Liquidity Guarantee Program to guarantee newly issued senior unsecured debt of banks, thrifts, and certain holding companies, and providing full coverage of non-interest bearing deposit transaction accounts, regardless of dollar amount.
Under the plan, certain newly issued senior unsecured debt issued on or before
In addition, any participating depository institution will be able to provide full deposit insurance coverage for non-interest bearing deposit transaction accounts, regardless of dollar amount. This new, temporary guarantee expires at the end of 2009.
"The program will be funded through special fees and does not rely on taxpayer funding," FDIC Chairman Sheila Bair said. Participants will be charged a 75-basis point fee to protect their new debt issues, and a 10-basis point surcharge will be added to a participating institution's current insurance assessment in order to fully cover the non-interest bearing deposit transaction accounts.
Fact Sheet – Temporary Liquidity Guarantee Program