Daily outrage: Bank insurer forced to decide which horrible rescue option is best 

WHO: Federal Deposit Insurance Corp.

WHAT: The FDIC is weighing several costly — and unprecedented — options to shore up its dwindling fund, which insures U.S. bank deposits. Each of these rescue tactics carries risks.

WHICH WAY? The agency could borrow billions from healthy banks, taking dollars out of the private sector. Imposing a special fee on the entire industry could push weaker financial institutions toward failure. Borrowing from the Treasury would be seen as another taxpayer-financed bailout. Making banks pay their regular premiums early wouldn’t deliver enough cash.

WHAT’S BEING DONE: The FDIC is expected to propose a solution — possibly combining two or more options — at a board meeting next week.

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Staff Report

Staff Report

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A daily newspaper covering San Francisco, San Mateo County and serving Alameda, Marin and Santa Clara counties.
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