Federal deposit insurance corporations

Federal Deposit Insurance Corporations insures deposits of U.S. commercial banks which meet its regulations; the coverage provides up to $100,000 per depositor. Roughly 98 percent of all U.S. banks are insured, and approximately 62 percent of all commercial bank deposits are covered by the FDIC's insurance program. Each participating bank is assessed annually an amount equal to about 1\10 of 1 percent of its eligible deposits to build and maintain a national insurance fund.
One of the most important functions of the FDIC is to act as a check on the state banking commissions, because few banks today-even those with state charters-will open their doors without FDIC insurance. The FDIC reviews the adequacy of capital, earnings prospects, the character of management, and the public convenience and needs aspects of each application before granting deposit insurance. This agency is also charged with examining insured banks that are not members of the Federal Reserve System, and it must approve applications for branches, changes in location, or mergers involving federally insured banks. The FDIC is empowered to close a bank will be merged with or absorbed by a healthy one; FDIC often purchases some of the bankrupt institution's weaker assets to support such a merger.