Daily Graphic: The Incredible Shrinking FDIC Reserve Fund

The data below came from the FDIC’s Graph Book.  Over thirty banks have failed this year and 25 failed last year.  The Deposit Insurance Fund, the fund with which the FDIC essentially eats portions of bank failures is roughly one-fifth of its 2006 value.  The chart below represents the percent of FDIC insured deposits currently in the fund.  In other words, about one quarter of one percent of the FDIC’s potential total liability is in their reserve.  This fund has shrunk drastically during the current recession.