Federal Deposit Insurance Corporation FDIC

During the Great Depression thousands of banks failed and depositors lost their savings in bank runs. The Banking Act of 1933, signed on June 16, 1933, created the Federal Deposit Insurance Corporation, and federal deposit insurance took effect on January 1, 1934. Since then no depositor has lost a penny of insured deposits. The FDIC is run by a five-member board that includes the Comptroller of the Currency and the Director of the Consumer Financial Protection Bureau, and it is funded by premiums paid by banks rather than by annual appropriations.

The FDIC insures deposits up to 250,000 dollars per depositor, per bank, for each ownership category, a limit made permanent in 2010. It is the main federal supervisor of state-chartered banks that are not members of the Federal Reserve System, examining them for safety and soundness and compliance with consumer laws. When a bank fails, the FDIC steps in as receiver, usually over a weekend, selling the bank to a healthier one or paying depositors directly from the Deposit Insurance Fund. Since 2010 it has also had authority to wind down large failing financial companies.

In March 2023 the sudden failures of Silicon Valley Bank and Signature Bank led regulators to protect all of their deposits, including uninsured ones, and First Republic Bank failed that May. A 2024 independent report on sexual harassment and a hostile workplace at the agency led to a change in leadership in early 2025. Under new leadership in 2025 the FDIC dropped reputational risk from bank examinations and eased rules on mergers and crypto activities, while the administration discussed consolidating federal bank regulators. Supporters said the changes reduced burdens and political pressure on banks, while critics warned they could weaken oversight just two years after a regional banking crisis.