H.R. 1185 (109th): Federal Deposit Insurance Reform Act of 2005

Mar 09, 2005 (109th Congress, 2005–2006)
Died (Passed House)
Spencer Bachus III
Representative for Alabama's 6th congressional district
Read Text »
Last Updated
May 09, 2005
78 pages
Related Bills
H.R. 522 (108th) was a previous version of this bill.

Passed House
Last Action: Apr 02, 2003

H.R. 4636 (Related)
Federal Deposit Insurance Reform Conforming Amendments Act of 2005

Signed by the President
Feb 15, 2006


This bill was introduced in a previous session of Congress and was passed by the House on May 4, 2005 but was never passed by the Senate.

Introduced Mar 09, 2005
Referred to Committee Mar 09, 2005
Reported by Committee Apr 27, 2005
Passed House May 04, 2005
Full Title

To reform the Federal deposit insurance system, and for other purposes.


No summaries available.

May 04, 2005 3:58 p.m.
Passed 413/10

Primary Source

THOMAS.gov (The Library of Congress)

GovTrack gets most information from THOMAS, which is updated generally one day after events occur. Activity since the last update may not be reflected here. Data comes via the congress project.


Get a bill status widget for your website »


Click a format for a citation suggestion:


H.R. stands for House of Representatives bill.

A bill must be passed by both the House and Senate in identical form and then be signed by the president to become law.

The bill’s title was written by its sponsor.

GovTrack’s Bill Summary

We don’t have a summary available yet.

Library of Congress Summary

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress.

5/4/2005--Passed House amended.
Federal Deposit Insurance Reform Act of 2005 - Amends the Federal Deposit Insurance Act (FDIA) to merge the Bank Insurance Fund and the Savings Association Insurance Fund into the Deposit Insurance Fund (DIF).
Section 3 -
Amends the FDIA and the Federal Credit Union Act to:
(1) increase the standard maximum amount of deposit insurance coverage from $100,000 to $130,000, coupled with a five-year cost-of-living adjustment index;
(2) require the Federal Deposit Insurance Corporation (FDIC) to provide pass-through deposit insurance for the deposits of any employee benefit plan (except for an insured depository institution that is neither well capitalized nor adequately capitalized, which may not accept such deposits);
(3) double to $260,000 the standard maximum deposit insurance for certain retirement accounts; and
(4) increase the maximum amount of deposit insurance coverage for in-State municipal deposits according to a specified formula, but to no more than $2 million.
Section 4 -
Amends the FDIA to replace assessment guidelines for achieving and maintaining a designated reserve ratio (DRR) and for independent treatment of deposit insurance funds.
Requires the Board of Directors (Board) of the FDIC to set assessments as it determines appropriate, including a maximum base rate for assessments at one basis point for insured depository institutions in the lowest-risk category.
(Thus, eliminates the current minimum 23 basis point cliff rate.) Reduces from five years to three years the mandatory assessment recordkeeping period.
Increases penalties from $100 to one percent of assessments per day for failure of a depository institution assessed more than $10,000 to make timely assessment payments.
Revises guidelines governing the risk-based assessment system to make the portion of deposits attributable to lifeline accounts subject to half the assessment rate that would otherwise be applicable.
Section 5 -
Replaces the current 1.25 percent DRR used to recapitalize undercapitalized insurance funds with a reserve ratio range of 1.15 to 1.4 percent of estimated insured deposits, subject to specified factors and annual redetermination.
Section 6 -
Directs the Board to collect information from all appropriate sources in determining risk of DIF losses.
Section 7 -
Revises requirements for FDIC repayment of overpaid assessments and refunds of any balance in the insurance fund in excess of the DRR. Prescribes guidelines governing:
(1) the payment of mandatory dividends to insured depository institutions whenever the DIF reserve ratio exceeds specified percentages of the estimated insured deposits required to maintain the DRR in effect at the time; and
(2) a one-time credit predicated upon the December 31, 1996, assessment base of each eligible depository institution, as compared to the combined aggregate assessment base of all such institutions.
Restricts the amount of such credit for depository institutions that exhibit financial, operational, or compliance weakness, including undercapitalization.
Requires the Board to establish an on-going system of credits (on-going credit pool) to be applied against future assessments on the same basis as such dividends.
Section 8 -
Requires the Board to establish and implement a DIF restoration plan whenever its reserve ratio is projected to fall, or actually falls below the DRR. Prescribes requirements for such plans, notably restoration to the DRR level within ten years.
Section 9 -
Requires the FDIC to prescribe final regulations within 270 days establishing the DRR, implementing increases in deposit insurance coverage, implementing the dividend requirement and the one-time assessment credit, and providing for premium assessments.
Section 10 -
Requries studies and reports to Congress:
(1) by the Comptroller General and the FDIC on the effectiveness of the prompt corrective action program administered by Federal banking agencies as well as the accuracy of FDIC risk assessments made, and the appropriateness of FDIC organizational structure in light of its regulatory mission;
(2) by the FDIC and the National Credit Union Administration on the feasibility of establishing a voluntary deposit insurance system for deposits in excess of the maximum amount of deposit insurance, and of privatizing all deposit insurance at insured depository institutions and credit unions;
(3) by the FDIC on the feasibility of using actual domestic deposits rather than estimated insured deposits in calculating and designating the DRR; and
(4) by the FDIC on the reserve methodology and loss accounting it used between January 1, 1992, and December 31, 2004, with respect to insured depository institutions in a troubled condition.
Section 11 -
Directs the FDIC to conduct a bi-annual survey and report to Congress on efforts by insured depository institutions to bring into the conventional finance system those individuals and families who have rarely, if ever, held a checking account, a savings account, or other type of transaction or check cashing account at an insured depository institution.
Section 12 -
Establishes the Deposit Insurance Fund for use by the FDIC with respect to insured depository institutions whose deposits are insured by the Deposit Insurance Fund. Authorizes the FDIC to borrow from the Federal home loan banks, with the concurrence of the Federal Housing Finance Board, such funds as it considers necessary for DIF use.
Section 13 -
Amends specified Federal statutes to make technical and conforming amendments relating to the merger of the BIF and SAIF.

House Republican Conference Summary

The summary below was written by the House Republican Conference, which is the caucus of Republicans in the House of Representatives.

No summary available.

House Democratic Caucus Summary

The House Democratic Caucus does not provide summaries of bills.

So, yes, we display the House Republican Conference’s summaries when available even if we do not have a Democratic summary available. That’s because we feel it is better to give you as much information as possible, even if we cannot provide every viewpoint.

We’ll be looking for a source of summaries from the other side in the meanwhile.

Use the comment space below for discussion of the merits of H.R. 1185 (109th) with other GovTrack users.
Your comments are not read by Congressional staff.

comments powered by Disqus