The FDIC is proposing increasing the small bank regulatory asset threshold for deposit insurance assessment purposes to $30 billion from $10 billion. .The three-member FDIC board unanimously approved advancing the change on June 25. If finalized, the updated threshold would adjust every four years for inflation. The reclassification impacts 76 financial institutions. The FDIC also unanimously approved reducing deposit insurance assessments two basis points for small banks. FDIC Chair Travis Hill said the proposed reduction shows the progress the agency has made to build the Deposit Insurance Fund since it crossed its statutory minimum reserve ratio of 1.35 percent on June 30, 2025, more than three years before its target of September 2028. The fund had exceeded the 1.35 percent statutory minimum in fall 2018, but a large increase in insured deposits during the first six months of 2020 caused the ratio to fall below that mark. Under the plan, large banks could reduce their assessments by up to one basis point by either successfully completing a virtual data room testing exercise and/or offering temporary access to internal systems and service providers. According to the FDIC, those steps could cut back on Deposit Insurance Fund losses if a bank fails. The FDIC estimated the changes would reduce industry assessments $4 billion annually. Comments on the proposals will be accepted for 60 days following publication in the Federal Register.The American Bankers Association and Independent Community Bankers of America support the changes.
