WASHINGTON – Although bankers want full insurance for certain deposits to be extended, the Federal Deposit Insurance Corp. encouraged institutions Monday to tell customers in advance that that insurance may expire.

Under the Dodd-Frank Act, the FDIC’s blanket coverage for noninterest-bearing transaction accounts will expire at yearend. Community banks have urged lawmakers to prolong the coverage – first introduced by the FDIC during the crisis – arguing that ending it now could spook depositors and boost liquidity at institutions with an implicit government guarantee.

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