FDIC Provides Notice of Expiration of the TAG Program

Nov 6 - Pursuant to Section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, temporary unlimited deposit insurance coverage for noninterest-bearing transaction accounts, including Interest on Lawyer Trust Accounts, is scheduled to expire on Dec. 31, 2012. Absent a change in law, beginning Jan. 1, 2013, the FDIC no longer will provide separate, unlimited deposit insurance coverage for NIBTAs at insured depository institutions. IDIs are encouraged to take reasonable steps to provide adequate advance notice to NIBTA depositors of the changes in FDIC insurance coverage so that they may consider the impact of any change in coverage in their management of these transaction accounts.

Highlights:

Section 343 of the Dodd-Frank Act provides separate, unlimited FDIC coverage for NIBTA depositors through Dec. 31, 2012. Beginning Jan. 1, 2013, the FDIC will insure NIBTAs in accordance with 12 C.F.R. Part 330, which generally provides each depositor up to $250,000 in coverage at each separately chartered IDI.

Some NIBTA depositors may not be aware of the reduction in coverage. To ensure NIBTA depositors receive adequate advance notice of this insurance coverage change, we encourage IDIs to:

• Provide NIBTA depositors adequate advance notice in writing that the temporary unlimited coverage for NIBTA deposits is scheduled to expire on Dec. 31, 2012, and thereafter the FDIC will insure NIBTAs up to $250,000 per depositor.
• Remove from their main offices, branches and websites the "Notice of Changes in Temporary FDIC Insurance Coverage for Transaction Accounts" required by 12 C.F.R. § 330.16(c)(1).
• Review NIBTA account agreements and related disclosure statements, and modify the documents as necessary to reflect accurately NIBTA coverage on Jan. 1, 2013.

FDIC has posted frequently asked questions and answers regarding NIBTA coverage at www.fdic.gov/deposit/deposits/unlimited/expiration.html.