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The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation supplying deposit insurance to depositors in American commercial banks and savings banks. The FDIC was created by the Banking Act of 1933, enacted during the Great Depression to restore trust in the American banking system. More than one-third of banks failed in the years before the FDIC's creation, and bank runs were common. The insurance limit was initially US$2,500 per ownership category, and this has been increased several times over the years. Since the enactment of the Dodd–Frank Wall Street Reform and Consumer Protection Act in 2010, the FDIC insures deposits in member banks up to $250,000 per ownership category. FDIC insurance is backed by the full faith and credit of the government of the United States, and according to the FDIC, "since its start in 1933 no depositor has ever lost a penny of FDIC-insured funds".
In the United States, banking had begun by the 1780s, along with the country's founding. It has developed into a highly influential and complex system of banking and financial services. Anchored by New York City and Wall Street, it is centered on various financial services, such as private banking, asset management, and deposit security.
A repurchase agreement, also known as a repo, RP, or sale and repurchase agreement, is a form of short-term borrowing, mainly in government securities. The dealer sells the underlying security to investors and, by agreement between the two parties, buys them back shortly afterwards, usually the following day, at a slightly higher price.
The National Credit Union Administration (NCUA) is an American government-backed insurer of credit unions in the United States, one of two agencies that provide deposit insurance to depositors in U.S. depository institutions, the other being the Federal Deposit Insurance Corporation, which insures commercial banks and savings institutions. The NCUA is an independent federal agency created by the United States Congress to regulate, charter, and supervise federal credit unions. With the backing of the full faith and credit of the U.S. government, the NCUA operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of more than 124 million account holders in all federal credit unions and the overwhelming majority of state-chartered credit unions. Besides the Share Insurance Fund, the NCUA operates three other funds: the NCUA Operating Fund, the Central Liquidity Facility (CLF), and the Community Development Revolving Loan Fund (CDRLF). The NCUA Operating Fund, with the Share Insurance Fund, finances the agency's operations.
A savings and loan association (S&L), or thrift institution, is a financial institution that specializes in accepting savings deposits and making mortgage and other loans. The terms "S&L" and "thrift" are mainly used in the United States; similar institutions in the United Kingdom, Ireland and some Commonwealth countries include building societies and trustee savings banks. They are often mutually held, meaning that the depositors and borrowers are members with voting rights, and have the ability to direct the financial and managerial goals of the organization like the members of a credit union or the policyholders of a mutual insurance company. While it is possible for an S&L to be a joint-stock company, and even publicly traded, in such instances it is no longer truly a mutual association, and depositors and borrowers no longer have membership rights and managerial control. By law, thrifts can have no more than 20 percent of their lending in commercial loans—their focus on mortgage and consumer loans makes them particularly vulnerable to housing downturns such as the deep one the U.S. experienced in 2007.
The savings and loan crisis of the 1980s and 1990s was the failure of 32% of savings and loan associations (S&Ls) in the United States from 1986 to 1995. An S&L or "thrift" is a financial institution that accepts savings deposits and makes mortgage, car and other personal loans to individual members.
The Canada Deposit Insurance Corporation is a Canadian federal Crown Corporation created by Parliament in 1967 to provide deposit insurance to depositors in Canadian commercial banks and savings institutions. CDIC insures Canadians' deposits held at Canadian banks up to C$100,000 in case of a bank failure. CDIC automatically insures many types of savings against the failure of a financial institution. However, the bank must be a CDIC member and not all savings are insured. CDIC is also Canada's resolution authority for banks, federally regulated credit unions, trust and loan companies as well as associations governed by the Cooperative Credit Associations Act that take deposits.
The Federal Home Loan Banks are 11 U.S. government-sponsored banks that provide liquidity to financial institutions to support housing finance and community investment.
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The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA), is a United States federal law enacted in the wake of the savings and loan crisis of the 1980s.
The Federal Savings and Loan Insurance Corporation (FSLIC) was an institution that administered deposit insurance for savings and loan institutions in the United States.
NetBank, formerly named Atlanta Internet Bank (1996) and Net.B@nk (1998), was a direct bank.
Deposit Insurance Agency (DIA) is a Russian state corporation established in January 2004 to manage operation of the deposit insurance system in the Russian Federation. DIA pays insurance compensations to depositors of failed banks. DIA also exercises bankruptcy administrator functions of insolvent banks, non–governmental pension funds and insurance companies, it is responsible for resolution of banks and managing the system of guaranteeing the rights of insured persons in the mandatory pension insurance system.
The Korea Deposit Insurance Corporation (KDIC) is a deposit insurance corporation, established in 1996 in South Korea to protect depositors and maintain the stability of the financial system. The main functions of KDIC are insurance management, risk surveillance, resolution, recovery, and investigation.
Old Court Savings and Loan was a savings and loan association headquartered in Pikesville, Maryland, United States, that failed due to embezzlement by its president Jeffrey Levitt, which led to the failure of the state deposit insurance corporation.
The National Credit Union Share Insurance Fund provides deposit insurance to protect the accounts of credit union members at federally insured institutions in the United States. Created in 1970, the Share Insurance Fund is administered by the National Credit Union Administration, an independent federal financial regulator. The Share Insurance Fund is funded completely by participating credit unions, and not one penny of insured savings has ever been lost by a member of a federally insured credit union. The Share Insurance Fund is backed by the full faith and credit of the United States government.
Bank regulation in the United States is highly fragmented compared with other G10 countries, where most countries have only one bank regulator. In the U.S., banking is regulated at both the federal and state level. Depending on the type of charter a banking organization has and on its organizational structure, it may be subject to numerous federal and state banking regulations. Apart from the bank regulatory agencies the U.S. maintains separate securities, commodities, and insurance regulatory agencies at the federal and state level, unlike Japan and the United Kingdom. Bank examiners are generally employed to supervise banks and to ensure compliance with regulations.
The government interventions during the subprime mortgage crisis were a response to the 2007–2009 subprime mortgage crisis and resulted in a variety of government bailouts that were implemented to stabilize the financial system during late 2007 and early 2008.
ESM Government Securities, Inc. was a Fort Lauderdale, Florida-based government securities dealer, specializing in repurchase agreements and reverse repurchase agreements. The failure of the company in March 1985 precipitated the collapse of Home State Savings Bank, deposit runs on dozens of other banks in Ohio, and the downfall of the private Ohio Deposit Guarantee Fund.
Marvin Leon Warner was the United States Ambassador to Switzerland and Liechtenstein from 1977 until 1979 and the owner of the Birmingham Stallions. He was the owner of Home State Savings Bank, breeder of thoroughbred horses, part owner of the New York Yankees from 1973 until 1975 as well as the Tampa Bay Buccaneers.
References
- ↑ "Marvin Warner, 82; Head of Failed Bank". L.A. Times. April 13, 2002.
- ↑ "Marvin Warner". bhamwiki.com. Retrieved May 15, 2016.
- ↑ Financial crisis management four financial crises in the 1980s : staff study. 1997. ISBN 9781428978140 . Retrieved May 15, 2016.
- ↑ "Toledo Blade - Google News Archive Search". news.google.com.
- ↑ Bartholomew, Philip F. (1990). "Reforming federal deposit insurance". google.com. Retrieved May 15, 2016.
- ↑ "3 CONVICTED IN FAILURE OF HOME STATE". The New York Times. March 3, 1987 – via NYTimes.com.
- ↑ "Marvin Warner, 82, Figure in S.& L. Debacle". The New York Times. Associated Press. April 13, 2002 – via NYTimes.com.
- ↑ Writer, Joseph Cosco, Staff (July 24, 1985). "MIAMI LAWYER KILLS HIMSELF IN WAKE OF ESM". Sun-Sentinel.com. Retrieved June 7, 2021.
{{cite web}}: CS1 maint: multiple names: authors list (link) - ↑ "The Government Securities Market: In the Wake of ESM Santa Clara Law Review January 1, 1987".