WASHINGTON — More than one-third of the banking industry is taking a pass on the Federal Deposit Insurance Corp.'s program to back bank debt.

More than 3,100 banks — most of them smaller, community banks — have opted out of the FDIC program, according to a list released by the agency on Thursday. It said 863 institutions opted out of the program's unlimited coverage of non-interest-bearing checking deposits.

Several bankers said they did not want to participate in the debt program because they do not issue senior unsecured debt and the cost of the backing was too high.

"We don't need it," said J. Mariner Kemper, the chairman and chief executive officer of $9.5 billion-asset UMB Financial Corp. in Kansas City, Mo. "With the quality of our balance sheet, if we ever chose to go get debt, I think there's a market for it. In the meantime, we wouldn't have to pay the government for something we don't need."

(UMB did continue to participate in the program guaranteeing all non-interest-bearing deposits.)

Michael Achary, the chief financial officer of $7 billion-asset Hancock Holding Co., agreed.

"The biggest reason why we opted out … was, we have no debt on our balance sheet and we have no plans to incur debt between now and the middle of next year," he said.

(The company chose to remain in the deposit-coverage portion of the program.)

The FDIC unveiled a plan in October to guarantee bank debt for three years and zero-interest checking deposits until the end of 2009. Both guarantees were provided free until Dec. 5, and banks were allowed to opt out before fees took effect.

Institutions getting the extra deposit coverage must pay 10 basis points for deposits covered beyond the FDIC standard insurance limit of $250,000 per account.

Banks electing to keep the debt coverage will pay to insure new senior unsecured debt — issued between Oct. 14 and June 30, 2009 — until June 2012. The guarantee will cost most institutions between 50 and 100 basis points, depending on the debt's maturity.

Camden Fine, the chief executive of the Independent Community Bankers of America, said deciding whether to participate was easy for banks that felt the program did not apply to them.

"Most community banks don't issue senior unsecured debt, so they don't want to have to pay for something they don't issue," he said. "It just didn't seem of any value to them."

Of institutions not remaining in the deposit-coverage component, Mr. Fine said some institutions lack enough very large accounts to justify its cost.

"One, I think there may have just been some confusion. There could be some banks on there that didn't intend to opt out of the transaction account" coverage, he said.

"Number two, there are a great many community banks that do not have any accounts that are greater than $250,000. If they do, it would be like one or two accounts."

The most recognizable name among institutions on the opt-out list for the debt-coverage program was $82 billion-asset ING Bank in Wilmington, Del.

The thrift subsidiary of Amsterdam-based ING Group NV does not issue debt that would qualify for the coverage, said Deneen Stewart, its general counsel. (ING remained in the deposit-coverage portion of the program.)

Institutions opting out of the deposit-coverage component included $31.7 billion-asset USAA Federal Savings Bank in San Antonio. A spokeswoman for the bank said no one was available to comment about the institution's decision.

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Corrected December 12, 2008 at 8:17PM: Clarification: In an earlier version of this story about the FDIC's debt guarantee program, it should have said that over 3,100 banks, thrifts, and holding companies that issue debt have opted out. According to the FDIC, that figure includes 2,027 banks and thrifts.