The Federal Deposit Insurance Corporation (FDIC) is a United States government corporation providing deposit insurance to depositors in U.S. commercial banks and savings banks. The FDIC was created by the 1933 Bank Act, enacted during the Great Depression to restore trust in the American banking system. More than one-third of banks failed in the years before the FDIC's creation, and bank runs were common. The FDIC insures deposits in member banks up to US$250,000 per ownership category.
The FDIC and its reserves are not funded by public funds; member banks' insurance dues are the FDIC's primary source of funding. The FDIC also has a US$100 billion line of credit with the United States Department of the Treasury.
As of September 2020, total US bank deposits reached $17.12 trillion. The $118 billion FDIC fund covers less than 0.7% of all those deposits. With the additional $100 billion line of credit they have, that doesn't even cover 2% of all bank deposits. Any major bank failure and the government would need to bail them out... With taxpayer money. Yet another example to show how fragile our financial system is and why we are looking for alternatives to store our hard earned money.
https://www.fdic.gov/
https://ycharts.com/indicators/us_banks_total_deposits
https://www.fdic.gov/bank/analytical/quarterly/index.html
I have spoken to CDIC, bank of Canada ( central bank ), office of the superintendent, one credit union, and Nesbitt burns ( BMO ): i get responses such as : that I have to deal with "private" instance companies ( for example : the deposit guarantee coorp. Of Manitoba, or Nesbitt which is essentially an "insurance" company. Both of them have fees, charges, negative reviews, etc ) OR responses such as : that there is no real government-backed programme in Canada to protect USD currency. Opening a bank account in the USA, or converting to CAD, or investing in property, are not options at this time.
What should I do ?
One difference is that DICO insures ≤ $250K, but CDIC ≤ $100K. This website insinuates that DICO's more hazardous:
>###Credit unions have deposit insurance, but it's probably weaker
>Credit unions across the country generally have deposit insurance, too. For instance Ontario credit unions have coverage by the Deposit Insurance Corporation of Ontario (DICO), and other provinces have their own. Each of these deposit insurance corporations maintain an insurance pool to cover potential future losses. However, as far as I can tell, there is no explicit backing either by the provincial or federal governments.
>[...] So yes, credit unions also have deposit insurance, but it's not CDIC insurance and is not federally backed (and I don't think it's provincially backed either).
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I don't know Canadian corporate or insurance law. Thus what ought I know about DICO before depositing ≥ $100K? How do you assess DICO vs CDIC?
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Ought DICO's drawbacks discourage depositing ≥ $100K in an Ontario Credit Union? These savings must be maintained with full liquidity (e.g. to pay disabled siblings' tuition fees).
Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, after consultation with the Board of Directors of the Canada Deposit Insurance Corporation, pursuant to subsections 6(1) and (2) of the Canada Deposit Insurance Corporation Act and subsection 105(6) of the Financial Administration Act, appoints /u/GuiltyAir of Alert, Nunavut, as Chairperson of the Board of Directors of the Canada Deposit Insurance Corporation, to hold office during good behaviour for a term of two years, and fixes his remuneration and certain conditions of employment as set out in the annexed schedule, which remuneration is comprised of a per diem within the range ($850 - $1,000) and an annual retainer within the range ($40,000 - $50,000).
Sur recommandation du ministre des Finances, après consultation avec le conseil d’administration de la Société d’assurance-dépôts du Canada et en vertu des paragraphes 6(1) et (2) de la Loi sur la Société d’assurance-dépôts du Canada et du paragraphe 105(6) de la Loi sur la gestion des finances publiques, Son Excellence la Gouverneure générale en conseil nomme de /u/GuiltyAir, d'Alert (Nunavut), président du conseil d’administration de la Société d’assurance-dépôts du Canada, à titre inamovible pour une période de deux ans, et fixe sa rémunération et certaines conditions d’emploi conformément à l’annexe ci-jointe, lequel traitement est composé d’un taux journalier dans l’échelle (850 $ – 1 000 $) et des honoraires annuels dans l’échelle (40 000 $ – 50 000 $).
Introduced: Sponsor: Rep. Frank Lucas [R-OK3]
This bill was referred to the House Committee on Financial Services which will consider it before sending it to the House floor for consideration.
Rep. Frank Lucas [R-OK3] is a member of the committee.
