The Main Street Depositor Protection Act expands federal deposit insurance to cover noninterest-bearing transaction accounts (checking accounts that pay no interest) beyond the current $250,000 standard limit. The FDIC and credit union regulators would issue rules within six months setting a new maximum coverage amount between $250,000 and $5,000,000 for these accounts, based on considerations of banking system stability and economic growth. Banks with assets of $10 billion or less would be exempt from special insurance assessments during a transition period. The new coverage would be phased in gradually over 10 years to reach full implementation, and large systemically important banks and foreign bank branches would be excluded from the expanded coverage to prevent moral hazard. No subsequent changes to the insurance amount could be made without an act of Congress.
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