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FDIC Rule Creates Unlimited Protection for IOLTA Accounts PDF Print E-mail
The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) today approved a final rule to strengthen the agency's Temporary Liquidity Guarantee Program (TLGP). The Program guarantees newly issued senior unsecured debt of banks, thrifts, and certain holding companies, and provides full coverage of non-interest bearing deposit transaction accounts.

 

Under the transaction account guarantee program, a participating institution will be able to provide customers full coverage on non-interest bearing transaction accounts for an annual fee of 10 basis points. The coverage will be in effect for participating institutions until the end of 2009. After that date, these accounts will be subject to the basic insurance amount. The FDIC Board voted to include NOW accounts with interest rates of 0.5 percent or less and IOLTAs (lawyer trust accounts) in the transaction account program.

"We will implement this Program without relying on the taxpayer or the deposit insurance fund. Fees paid by participating entities should cover any losses associated with the guarantees," said Bair.

The final rule is attached.

 

 

Attachment:
Final Rule regarding the Temporary Liquidity Guarantee Program - PDF

 

(source FDIC.gov)

 

 
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