FDIC gets 22 billions from the Treasury?

[Dridamse]

May be is not that important.

http://www.fdic.gov/news/news/press/2009/pr09153.html



Press Releases

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FDIC-Insured Institutions Lost $3.7 Billion in the Second Quarter of 2009
Total Reserves of the Deposit Insurance Fund Stood at $42 Billion

FOR IMMEDIATE RELEASE August 27, 2009

Media Contact: Andrew Gray (202) 898-7192 angray@fdic.gov

Chairman Bair distinguished the DIF's reserves from the FDIC's cash resources, which included $22 billion of cash and U.S. Treasury securities held as of June 30, as well as the ability to borrow up to $500 billion from the Treasury. "A decline in the fund balance does not diminish our ability to protect insured depositors," Chairman Bair concluded.

[zoog]

Re: FDIC gets 22 billions from the Treasury?

May be is not that important.

http://www.fdic.gov/news/news/press/2009/pr09153.html



Press Releases

---

FDIC-Insured Institutions Lost $3.7 Billion in the Second Quarter of 2009
Total Reserves of the Deposit Insurance Fund Stood at $42 Billion

FOR IMMEDIATE RELEASE August 27, 2009

Media Contact: Andrew Gray (202) 898-7192 angray@fdic.gov

Chairman Bair distinguished the DIF's reserves from the FDIC's cash resources, which included $22 billion of cash and U.S. Treasury securities held as of June 30, as well as the ability to borrow up to $500 billion from the Treasury. "A decline in the fund balance does not diminish our ability to protect insured depositors," Chairman Bair concluded.

The way I read this:

Total reserves of the Deposit Insurance Fund (DIF) stood at $42 billion. Just as insured institutions reserve for loan losses, the FDIC has to provide for a contingent loss reserve for future failures.
...
Chairman Bair distinguished the DIF's reserves from the FDIC's cash resources, which included $22 billion of cash and U.S. Treasury securities held as of June 30, as well as the ability to borrow up to $500 billion from the Treasury.

is that the fund they use to cover deposits on failed banks (the DIF) is currently at $42 billion. In addition to that fund, the FDIC has $22 billion for operating expenses and such, which happens to partially be sitting in Treasury bonds. I don't read this as an infusion of $22 billion from the Treasury into the DIF. As noted, Congress some months ago approved that if/when it becomes necessary, the Treasury can give the FDIC up to $500 billion.