Spring break: Small banks near premium-relief threshold

   AFTER PAYING HIGHER deposit insurance assessment fees since the 2008-2009 big=bank bailout and Dodd-Frank legislation, community banks may soon be getting a break.

   The FDIC’s Deposit Insurance Fund ratio of reserves to insured deposits is nearing a threshold that wouldtrigger a reprieve from paying assessment fees for institutions with less than $10 billion of assets.

It’s unclear how many banks will find the result financially material enough to improve earnings. For most banks, the premiums constitute less than 5 percent of revenues. But for others, they exceed that level.

Moreover, each bank gets a chance to decide how it will use the extra funds — so even if the reduction doesn’t go immediately to the bottom line, it may be used for capital expenditures such as improved technological services.

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