- Nine Republican AGs, led by Oklahoma AG Gentner Drummond, wrote a letter to the FDIC criticizing its proposed rule that would impose a special assessment on certain banking institutions to recoup the losses to the Deposit Insurance Fund that resulted from the FDIC’s bailout of uninsured depositors of Silicon Valley Bank and Signature Bank following those banks’ collapse.
- In the letter, the AGs assert that the FDIC’s decision to bail out uninsured depositors by invoking the systemic risk exception of the Federal Deposit Insurance Act was unprecedented, arbitrary, and capricious. The AGs also argue that community banks will be hardest hit by the bailout because consumers will believe their money is safer at a larger bank that is more likely to be bailed out in the case of failure, and that taxpayers will ultimately bear the cost of the special assessment.
- The AGs ask the FDIC to reverse course on the proposed special assessment, or at a minimum ensure its costs are borne only by firms and entities directly responsible for, or benefitting from, the bailout.