The share of reciprocal deposits that escapes the broker label falls in three steps
What the document says“``(A) An amount equal to 50 percent of the portion of the total liabilities of the agent institution that is less than or equal to $1,000,000,000. ``(B) An amount equal to 40 percent of the portion, if any, of the total liabilities of the agent institution that is greater than $1,000,000,000, but less than or equal to $10,000,000,000.”
The section replaces paragraph (1) of section 29(i) of the Federal Deposit Insurance Act with a three-tier formula. Reciprocal deposits are not treated as funds obtained through a deposit broker up to 50 percent of liabilities at or below $1,000,000,000, 40 percent of liabilities above that and up to $10,000,000,000, and 30 percent of liabilities above that and up to $96,333,333,333.
What the document actually says“``(A) An amount equal to 50 percent of the portion of the total liabilities of the agent institution that is less than or equal to $1,000,000,000. ``(B) An amount equal to 40 percent of the portion, if any, of the total liabilities of the agent institution that is greater than $1,000,000,000, but less than or equal to $10,000,000,000.”
Half of the first billion dollars a bank owes may be covered. Above that the share drops to 40 percent. That band runs up to ten billion dollars.
A swapped deposit is one bank trading deposits with another. It keeps a large saver fully insured. The bigger the bank, the smaller the share that escapes.
No action is recorded against this proposal. That is not evidence that none has been taken, and nobody has yet read it against the record. See what the tracker does not yet cover.