Thread: Chase and Citibank to Drop Out of FDIC Coverage Program

Chase and Citibank to Drop Out of FDIC Coverage Program

I am wondering what any of you think of this move? I have 3 accounts with Chase and to be honest it makes me very afraid. I can't see why they would make such move and how it benefits them. It certainly seems they are wanting to distance themselves from federal regulations or something. One rule it seems they can duck - Any bank not participating in 4(k) compliant activities means a bank can invest in any company, risky or not, or financial in nature or not. Which means they are taking your money and perhaps gambling with it.

Any thoughts?



Beginning January 1, 2010, JPMorgan Chase Bank, N.A. will no longer participate in the (FDIC’s) Transaction Account Guarantee Program. As a result, after December 31, 2009, funds held in non-interest bearing transaction accounts* and IOLTA, IOLA and IOTA accounts will no longer be guaranteed in full under the Transaction Account Guarantee Program. However, these accounts will be insured up to $250,000 per depositor under the FDIC’s general deposit rules…

Note: Beginning January 1, 2010, Citibank will no longer participate in the FDIC’s Transaction Account Guarantee Program. Thus, after December 31, 2009, funds held in noninterest-bearing transaction accounts (non-interest and interest-bearing checking accounts) will no longer be guaranteed in full under the Transaction Account Guarantee Program, but will be insured up to $250,000 under the FDIC’s general deposit insurance rules.

I never heard of it either. Does it cost the bank to be FDIC insured?

I have already begun to transfer all but some small operating accounts to my Schwab account.

^ I don't know if it costs.

I don't know anything.

You can google this and probably get some info.

Originally Posted by chitown

Does it cost the bank to be FDIC insured?

Yes they have to pay for it.

At the moment, due to the sheer volume of banks in America collapsing, the FDIC are asking all banks to pay their premiums between 3 and 5 years in advance. This is so the advanced cash can be used to pay up insured customers of all these small banks that are failing at the rate of about 2 per week.

The FDIC has NO WAY of paying everybody who has money in banks their money back in the event of systemic failure. They don't have enough money, didn't have enough money before all of these problems started and will never have enough money in the future.

This from wiki which I belive to be correct:

"The Federal Deposit Insurance Corporation announced that the insurance fund that covers more than $4.5 trillion in deposits had a negative balance of $8.2 billion as of the end of the third quarter 2009"

FDIC are out of cash, bankrupt. Caputt.

This from Suntrust:

SunTrust is participating in the FDIC’s Transaction Account Guarantee Program through December 31, 2009. Under this program, we can provide our clients with separate unlimited FDIC insurance coverage on all non-interest bearing transaction deposit accounts, including personal and business checking accounts, regardless of dollar amount. Beginning January 1, 2010, SunTrust will no longer participate in the FDIC’s Transaction Account Guarantee Program. Thus, after December 31, 2009, funds held in noninterest-bearing transaction accounts will no longer be guaranteed in full under the Transaction Account Guarantee Program, but will be insured up to $250,000 under the FDIC’s general deposit insurance rules. For additional information on FDIC coverage, click here.

I was thinking about opening up a savings account with them. Huh. Good thing I've only got like $100 anyway. I should be under the limit.

Originally Posted by Milkman

^ I don't know if it costs.

I don't know anything.

You can google this and probably get some info.

Thanks I will. I thought it was good info to pass along and worthy of discussion here. In the future I will just google and not waste time by posting.