FDIC

The FDIC, or Federal Deposit Insurance Corporation, is an independent agency of the US federal government created to preserve and promote public confidence in the US banking system. The FDIC was created by Congress in 1933 as part of the Glass-Steagall Act. The primary activity of the FDIC is to ensure deposits against loss due to bank insolvency. The FDIC insures certain types of account including checking accounts, savings accounts, and certificates of deposit, up to a total of $100,000 per depositor, and accounts held jointly as well as retirement accounts, can also separately be insured up to $100,000 by the FDIC. Because the sister institution created along with the FDIC, the FSLIC (Federal Savings and Loan Insurance Corporation), failed when a large number of Savings and Loans failed in the late 1980s and early 1990s, the FDIC now insures S&Ls, too. Critics of the FDIC suggest that today the FDIC could similarly fail if confronted with the insolvency of one "too big to fail" bank, which might result in a government bailout akin to the S&L bailout.