Latest FDIC Numbers Show “TAG” Deposits Over $1.3 Trillion

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Demonstrates why full FDIC “TAG” coverage on noninterest-bearing accounts is critical, says ICBA

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Community bankers nationwide are confident that a temporary extension of the TAG program is critical to help keep local deposits available in local banks to support small business lending, and job creation.

The Independent Community Bankers of America (ICBA) today said that deposits in excess of $250,000 in noninterest-bearing transaction accounts, or “TAG” deposits, total $1.3 trillion in the first quarter, up from $893 billion in the same quarter a year ago, according to the FDIC Quarterly Banking Profile released today. If Congress fails to extend the FDIC “TAG” insurance program, these deposits would become uninsured on Dec. 31. Congress did modify and extend this successful insurance in 2010 through 2012 and must now consider another extension.

ICBA has been leading the charge to bring attention to this critical community bank and small business issue and will continue to urge Congress to act quickly so that the bank-funded insurance doesn’t lapse on Dec. 31.

“The FDIC Quarterly Banking Profile numbers show that TAG deposits comprise 15 percent of total domestic deposits. Policymakers should act expeditiously to continue this successful and important insurance,” said Camden R. Fine, ICBA president and CEO. “Community bankers nationwide are confident that a temporary extension of the TAG program is critical to help keep local deposits available in local banks to support small business lending, and job creation.”

ICBA continues to urge Congress to approve a temporary five-year extension of deposit insurance coverage for non-interest bearing transaction accounts through 2017. “Banks fully pay for this insurance through their normal deposit insurance premiums, so extending this program is a win-win for everyone on Main Street,” Fine said.

ICBA points out the following reasons why this coverage must be renewed for another five years:

  •     Full FDIC coverage keeps business and municipal accounts secure. Small businesses and other entities use transaction accounts to meet payroll and other recurring expenses. Municipalities use these accounts to deposit local tax revenues and to pay operating expenses. These entities depend on full insurance coverage to keep their deposits safe and secure.
  •     The TAG program is fully paid for by the banking industry. The cost of this insurance coverage is reflected in the FDIC’s assessment rate schedule. Premiums paid by banks to the FDIC support a stable FDIC Deposit Insurance Fund. No taxpayer money is used to pay for this FDIC insurance since it is fully funded by bank premiums.
  •     Full coverage keeps deposits in the community with local lenders. For community banks, full FDIC coverage has been essential to retaining business payroll and checking accounts. This coverage helps community banks attract and retain deposits from local businesses and governments, keeping local funds invested in the community. The last thing the nation needs is even further deposit concentration in a few megabanks.
  •     Extending full insurance for TAG deposits will deter dangerous deposit concentration. Full FDIC coverage allows community banks to compete fairly with the largest banks for deposits and deters dangerous concentration of deposits in a handful of large institutions. If this full coverage ends, transaction account funds in excess of $250,000 will immediately become uninsured “hot money” that could flee an institution quickly, destabilizing the banking system in favor of large institutions. Congress must address this FDIC insurance expiration uncertainty to prevent unintended consequences. More than $1.3 trillion in deposits would abruptly become uninsured if Congress does not act.

For more information about extending full FDIC insurance for TAG deposits and ICBA, visit

About ICBA
The Independent Community Bankers of America®, the nation’s voice for more than 7,000 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit

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