WASHINGTON -- When deposit insurance bills are mailed out this week, 277 more banks will be paying the lowest premium rate.

That brings the total number of banks paying the 23-cent rate to 9,888. Those banks hold $2 trillion in deposits, or 86% of the industry's total.

In stark contra, st, 49 banks, or just 0.4% of the industry, will pay the highest rate of 31 cents for insurance on every $100 of deposits.

When risk-based premiums began 18 months ago, banks were not expected to bunch up at the best rate. Back then the 23-cent category claimed just 51% of the industry's deposits.

This raises the question: Does the risk-based premium system work?

Category May Be Added

"The gradations are too broad," said Roger Watson, research director at the Federal Deposit Insurance Corp. "We're toying with the idea of a 'super clean category.'"

"The best banks ought to pay less, medium banks or so-so banks, ought to be paying a bigger share," agreed John Stone FDIC's executive director of supervision. "It really is not a risk-based premium system because it's not spread enough."

FDIC Chief Financial Officer Steven A. Seelig is leading a broad staff study that could result in a sweeping overhaul of the way banks pay for deposit insurance.

By summer's end, the agency will have issued an advanced notice of proposed rulemaking that will suggest different ways of reconfiguring the base on which premiums are based.

Reflection of Risk at Issue

"The real question is, how do you measure risk and how do you reflect the risk," Mr. Seelig said in an interview this week.

Rather than trying to reflect all the risks in the premium rate, the FDIC may decide to add other elements to the assessment base. Currently only insured deposits figure into a bank's premium calculation.

For example, Mr. Seelig said uninsured deposits may be added into the assessment base. Right now those funds share equally with the deposit insurance funds when money from a failed bank is recouped. So uninsured deposits posc a greater risk to the insurance funds than do other types of uninsured bank liabilities.

Asked what the downside is to this plan, Mr. Seelig said: "I don't think we know. The more we've thought about, this the more" questions that have popped up. That's why the FDIC is opting for an "advanced notice," which simply lays out an issue and suggests alternatives, rather than a proposed regulation.

"This whole notion of depositor preference raises new issues," Mr. Seelig said. "The first go-round is going to raise a lot of issues."

Depositor preference is the name given to the plan to pay uninsured depositors before other creditors. It was enacted last year as part of the budget bill.

Rating System May Be Revised

In addition to changes in the assessment base, the FDIC may add some boxes to its premium matrix and the supervisory rating system could be revamped.

Right now, banks are slotted into one of nine boxes in a matrix. Across the top are three supervisory groups. Down the side are three capital categories. Banks with the most capital and the best supervisory rankings are put in the A-1 box, where the premium rate is 23 cents.

Since risk-based premiums began in January 1993, banks have been building capital and improving supervisory ratings in order to move into the coveted A-1 category.

These nine boxes could be multiplied by adding new capital or supervisory categories. Right now the bulk of a bank's supervisory score is determined by its Camel rating. The FDIC is considering ways to make that determination more sophisticated by pulling in more factors.

82% of Thrifts at Lowest Rate

The thrift industry has also clustered in the lowest-rate category. For the second half of the year, 95 institutions climbed into the best box, bringing the total to 1,601 thrills, or 82% of the industry. Just 11 thrifts, or .6% of the industry, will pay the top rate.

Beyond A-1 are two boxes charging the next lowest rate, 26 cents.

Banks in these three top categories total 10,965, or 97.8% of the industry. These institutions hold $2.29 trillion in insured deposits.

Thrifts in the top three boxes total 1,803, or 92.2% of the industry. These thrills hold $635.1 billion in deposits.

Deposit insurance payments are due at the FDIC by July 31. The agency expects to collect $5.6 billion in bank premiums this year, down $200 million from last year.

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