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Federal Deposit Insurance Corporation Funds

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Insured deposit growth in 2000 and 2001, coupled with increased costs associated with bank and thrift failures, had a detrimental effect on the Bank Insurance Fund (BIF) and Savings Association Insurance Fund (SAIF) of the Federal Deposit Insurance Corporation. At the end of 2001, BIF reserves stood at 1.27% of insured deposits, down from the 1998 peak of 139 basis points (bp) of reserves for each dollar of insured deposits, making 2001 the third consecutive year of decline in the BIF reserve ratio. SAIF reserves stood at 1.37% of insured deposits, the second straight year of decline from the 1999 peak of 144 bp per dollar of insured deposits. Both funds, however, still exceed the 1.25% target Congress set in the Financial Institution Reform, Recovery and Enforcement Act of 1989.

Suggested citation: "Federal Deposit Insurance Corporation Funds," Federal Reserve Bank of Cleveland, Economic Trends, no. 02-06, pp. 16-17, 06.01.2002.

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