Bank of America Faces FDIC in $1.1 Billion Deposit Insurance Dispute
Bank of America and the Federal Deposit Insurance Corporation (FDIC) are set to square off in a federal court case. The FDIC alleges that the bank improperly calculated its exposure to large banks, making it appear less risky and resulting in underpayment of deposit insurance assessments. The case has been delayed due to factors including the COVID-19 pandemic and is now scheduled for oral arguments on motions for summary judgment.
The FDIC's lawsuit, initially filed in 2017, claimed that Bank of America underpaid by $542 million. However, an amended complaint later expanded the time frame for underpayments. Bank of America argues that the 2011 rule was unclear, and the FDIC violated the Administrative Procedure Act in its rule-writing process. Neither party has yet been identified as being charged in a federal court case for the alleged $1.1 billion underpayment.
The upcoming oral arguments will determine if the case proceeds towards a trial or if it can be resolved through summary judgment. The outcome will have significant implications for both parties and the banking industry's understanding of deposit insurance obligations.
