The FDIC was established by the: Banking Act of 1933
Federal Reserve Act of 1917
National Currency Act
Dual Banking System

The Federal Deposit Insurance Corporation (“FDIC”) has been credited with helping consumer confidence in the banking sector by insuring bank deposits “backed by the full faith and credit of the U.S. government.”[1] Most U.S. citizens do not even consider bank failure when they put their money in the financial services sector—even though just two short generations ago bank runs were commonplace. Part of the reason for this is that, since the creation of the FDIC, no banking customer “has ever lost a penny of insured deposits.”[2] The FDIC has been a powerful force in banking regulation that has served to secure our financial system.

This paper gives a broad overview of this important government entity. Section I describes the history and evolution of the FDIC, up to and including the recent financial crisis in 2008. Part II of the article describes the current authority of the FDIC, using historical examples of this authority. Part III gives practical ways that the FDIC works along with suggestions on how a person or business entity can maximize their insured deposits.