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What is the Federal Deposit Insurance Corporation?

Federal Deposit Insurance Corporation

The Federal Deposit Insurance Corporation (FDIC) is a corporation in the US that delivers deposit insurance to depositors of banks in the United States. It is funded by members’ banks' insurance dues and has a line of credit with the United States Department of Treasury worth $100 billion.

Where have you heard about the Federal Deposit Insurance Corporation?

The FDIC was established during the Great Depression by the 1933 Banking Act with the aim of rebuilding the trust between customers and the American banking system. In the immediate years preceding the Great Depression bank runs were very common.

What you need to know about the Federal Deposit Insurance Corporation.

1893-1907 saw many banking panics, which caused plenty of banks to declare bankruptcy. In 1893 William Jennings Bryan produced a bill to Congress advising the use of a national deposit insurance fund, but no action was taken. Subsequently, more than fourteen years later, eight states established deposit insurance funds. There was a general worry by the government that they would seem liable for the mistakes of individual banks. However after the devastation of the Great Depression on the American banking systems and overwhelming support by the American public, the law was passed nationwide by 1935.

Find out more about the Federal Deposit Insurance Corporation...
To understand more about the Federal Deposit Insurance Corporation’s origins, read about the Great Depression.

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