From CD accounts to FDIC coverage to Wall Street bailouts, banking questions are on lots of readers' minds. Here's a sample of answers by Rodney Brown, president and CEO of the California Bankers Association.
To ask your own question or view those that have already been posted, go to www.sacbee.com/ask.
What's your opinion of the new proposal to raise FDIC deposit insurance limits, from $100,000 to $250,000 on individual accounts? Is that a good idea?
We are taking a careful look at this proposal, and do feel that raising the insurance limits likely has merit on a short-term basis.
Is it safe to hold a flexible CD that is not federally insured?
The FDIC protects deposit accounts, including CDs, up to $100,000 for single accounts. Your CD should be insured up to that limit. To be completely sure, I would advise checking your FDIC insurance coverage online at www.fdic.gov/edie.
We recently renewed our two CDs at Wachovia Bank, which are now tied up for one year. Both accounts are under $100,000. In light of the economy, is there any chance that the FDIC will go broke? Would it be wise for us to withdraw our money and take the penalty, or stay where we are?
The FDIC protects all individual deposit accounts, including CDs, up to $100,000. The FDIC has more than $40 billion in assets available to protect depositors. In its 75-year history, not 1 cent of customer money in an FDIC-insured bank account has been lost. I would advise that you keep your CDs where they are and feel confident that they are safe and secure.
Overall, what is your opinion of the bailout plan? Can it really do something significant to prevent a further crisis?
The California banking industry is supportive of the legislation under consideration. What was initially a crisis on Wall Street has now spread to Main Street. Communities, small businesses and families will be hurt without a legislative solution to stabilize our economy.
The significant tightening of credit and dramatic increase in interest rate spreads that have occurred in the past few weeks serve as testimony to the need for comprehensive and definitive action.
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