Federal Deposit Insurance Corporation (FDIC) is an independent United States government agency that insures deposits at almost all U.S. banks and savings and loan associations, or thrifts. The FDIC insures individual accounts in banks and thrifts for up to $250,000. It pays off the accounts if an insured institution fails and is not bought by another institution. The FDIC also provides financial assistance to problem institutions to keep them from failing. In addition, it regulates and examines banks and thrifts to promote safe business practices.
A five-member board of directors manages the FDIC. The president appoints three of the directors for six-year terms. The other two are the comptroller of the currency and the director of the Consumer Financial Protection Bureau. FDIC funds come from fees paid by insured institutions and from earnings on U.S. government securities.
The FDIC was created in 1933 to help end a banking crisis during the Great Depression. In 1989, Congress gave the FDIC responsibility for insuring thrifts after a crisis in the industry led to the bankruptcy of the Federal Savings and Loan Insurance Corporation.
