WASHINGTON The Federal Deposit Insurance Corp. on Tuesday said the Bank Insurance Funds comprehensive income net income plus unrealized gains or losses on securities available for sale was $1.56 billion last year, a dramatic turnaround from a $198 million loss in 1999.
The agency attributed the nearly $1.76 billion swing to two factors: reduced expectations of bank failure costs and unrealized securities gains. 
In 2000 the bank fund lowered its reserves to cover the cost of failures by $153 million, a dramatic change from the $1.17 billion boost to reserves made in 1999. For 2000 the agency slashed by 54%, to $141 million, its contingent liabilities for anticipated bank failures.
The bank fund recorded an unrealized gain of $300 million last year on securities available for sale, compared to a $92 million unrealized loss in 1999. BIF ended 2000 with $31 billion, up 5.3% from 1999. Its reserves-to-insured deposits ratio was 1.35%.
The Savings Association Insurance Funds comprehensive income rose 8.4% last year, to $478 million. But the FDIC more than quadrupled, to $234 million, its estimate of future costs from thrift failures. The agency added $181 million to the thrift funds provisions to cover losses, compared to a $31 million increase in 1999. The FDIC has recently identified a small number of additional SAIF-insured financial institutions that may pose a greater risk to the insurance fund unless institution management can resolve existing problems, the agency said in a release.
If these institutions fail, they may cause a material loss to the SAIF.
The thrift funds bottom line, however, also got a boost from unrealized securities gains, which increased by $114 million last year, compared with a $36 million unrealized loss last year. With $10.8 billion, the SAIF reserve ratio was 1.43% on Dec. 31.
Figures on both funds were released as part of the agencys 2000 unaudited financial results.
