A vast majority of Americans do not approve of the Federal Deposit Insurance Corporation (FDIC) using its reserve funds to rescue large depositors above the insured limit, according to a new poll released by Convention of States Action in collaboration with The Trafalgar Group on Tuesday.
More than 70% of the 1,000 likely voters surveyed stated the FDIC should not spend its reserve funds to rescue big depositors — many in the millions — when they were only covered up to a quarter of one million, according to the report. They were conducted between March 20-22, just over one week after federal regulators announced they would bail out all Silicon Valley Bank and Signature Bank depositors, including those over the typical $250,000 insured cap using the FDIC’s Deposit Insurance Fund (DIF).
Only 17% of voters said the FDIC should use its reserve funds to bail out large depositors when they are only covered up to the standard cap, according to the poll. Roughly 13% said they were uncertain. (RELATED: Big Banks Raking In Billions Following Federal Bailouts As Smaller Banks Suffer)
The results were bipartisan, although Republicans and Independents were more against it than Democrats, with over 85% of them saying the FDIC should not bail out big depositors, according to the poll. Nearly 70% of Independents and over 50% of Democrats also disapproved of this.
The remainder of Democrats were split on whether they approved of it or they were uncertain about it with 26.2% saying the FDIC should use its own reserve and 22.4% saying they were not sure, according to the poll.
WASHINGTON, DC – MARCH 22: U.S. Secretary of the Treasury Janet Yellen testifies before the Senate Appropriations Subcommittee on Financial Services March 22, 2023 in Washington, DC. The committee heard testimony to “examine proposed budget estimates and justification for fiscal year 2024 for the Department of the Treasury.” (Photo by Win McNamee/Getty Images)
The FDIC will not be giving out “blanket insurance” for all U.S. bank deposits, but rather only for those at banks whose failures are designated as systemic risks, Treasury Secretary Janet Yellen told lawmakers during a Senate Appropriations Committee hearing on March 22.
Yellen has collected over $7 million in speaking fees from dozens of companies including Goldman Sachs, Bank of America, Citi, Credit Suisse, UBS, Charles Schwab and many more, according to her public financial disclosure report.
America’s 25 largest banks garnered $120 billion in deposits following the collapse, and subsequent depositor bailout, of SVB and Signature, while deposits at smaller banks fell by $108 billion, according to The Wall Street Journal.
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