Community Bankers Association of Illinois

Deposit Growth Slows, FDIC Assessment Rate Postponed

Noting that deposit growth slowed considerably during the third-quarter of 2007, the FDIC board of directors postponed a decision on what the 2008 first-quarter assessment rates for insured financial institutions will be until March 2008, when the agency expects to have more data. For now, it appears that the safest FDIC-insured institutions will continue to pay quarterly assessments of 5 to 7 basis points through the fourth quarter of this year.

Preliminary data showed deposit growth decreased to an annual rate of 0.2 percent during the third quarter of 2007, which would mean that for the first nine months this year deposit growth was around 2.8 percent. Officials anticipated an annualized deposit growth rate of at least 5 percent for the first nine months. The board did decide to maintain the designated reserve ratio for the Deposit Insurance Fund steady at 1.25 percent for 2008.

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