WASHINGTON — The Federal Deposit Insurance Corp. proposed Tuesday changing the formula it uses to calculate quarterly assessment fees on banks, responding to complaints from banks that a rule put in place last year was unworkable.
The proposal was published for a 60-day comment period. FDIC officials said the change wouldn't affect the revenue the agency receives from quarterly assessment fees.
The FDIC said the changes became necessary after banks were unable to comply with a rule published in February 2011. Banks said they were unable to report loan data consistent with the FDIC's original definitions.
The FDIC's fee system is designed to charge the biggest fees to banks that are taking on the most risk. The agency uses the money to offset the cost of bank failures.
In making the changes, the FDIC revised the definition of leveraged loans, classifying them as "higher risk" commercial and industrial loans and securities. It also renamed and revised the definition of subprime consumer loans and securities to enable banks to comply with the new rules.
In addition, the FDIC proposed a new rule, required by the Dodd-Frank financial overhaul, giving the regulator the power to prevent the cancellation of contracts agreed to by subsidiaries or affiliates of a large financial firm put into receivership. The financial overhaul law gave the FDIC new power to wind down large financial firms in the event of a collapse.
