WASHINGTON - The Federal Deposit Insurance Corp. has indefinitely delayed releasing its deposit insurance reform plan, which was due out next Monday.
The plan, which is expected to present a menu of options for revamping premiums and expanding coverage, has been postponed because of the absence of Chairman Donna Tanoue. Vice Chairman Andrew "Skip" Hove Jr. said at an FDIC meeting Thursday that Ms. Tanoue had flown home to Hawaii to be with her ailing father.
At the same meeting, the agency superseded an Iowa law that favors uninsured deposit claims by public institutions over other uninsured depositors after a bank failure.
The agency's board concluded that the law was inconsistent with a 1993 federal statute that said, after insured deposits have been covered, all uninsured depositors be paid simultaneously. The Iowa law requires that public institutions be repaid in full before other uninsured depositors are compensated.
The issue stems from the failure of Hartford-Carlisle Savings Bank in Carlisle, Iowa, in January. The FDIC preempted the state law at the time, but state officials filed an appeal with the agency in March. Iowa officials argued that creating a separate class of depositors did not conflict with the federal statute because all depositors were still a priority before any other obligations.