By suggesting that banks could absorb a sizable increase in deposit insurance premiums, a new study undercuts the case for a taxpayer bailout of the Federal Deposit Insurance Corp.

Just when bank lobbyist are beginning to talk about the need for taxpayer help, Keefe, Bruyette & Woods determined that the effect of a 7-cent increase in deposit insurance per $100 of deposits would be negligible for some and only moderately difficult for most banks.

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