Sponsors (7)
Introduced March 25, 2026 by William Francis Hagerty · Last progress March 25, 2026
The bill increases and clarifies federal deposit insurance for many transaction-account holders and provides legal certainty for that protection, while shifting greater contingent risk to taxpayers, limiting regulator flexibility to adjust coverage, and creating potential long-term costs for banks and their customers.
Depositors who keep noninterest-bearing transaction accounts (including middle-class families, low-income individuals, and small-business owners) gain expanded and clearer federal insurance coverage because balances are aggregated across accounts and subsidiaries, reducing the risk of loss if their bank or credit union fails.
Deposit insurance protection is made statutory, creating durable certainty for depositors and financial institutions by preventing the FDIC/NCUA from reducing the additional coverage without an Act of Congress.
Smaller banks and credit unions (those with ≤ $10 billion in assets) are temporarily shielded from new special assessments tied to the expanded insurance, lowering near-term cost pressure on community institutions and the communities they serve.
Taxpayers and the deposit insurance funds could face substantially higher contingent liabilities because insuring larger aggregated balances raises the exposure the FDIC/NCUA would cover in a bank failure.
Making the additional coverage statutory limits regulators' flexibility—the FDIC/NCUA cannot reduce or alter the extra insurance without Congress—potentially hampering timely responses to changing risk or systemic crises.
If the expanded insurance is funded over time through higher assessments, large banks could face increased costs that may be passed on to customers or shareholders, raising long-term costs for households and businesses.
Based on analysis of 2 sections of legislative text.
Establishes an additional, statutorily-protected FDIC insurance layer for aggregate noninterest-bearing transaction accounts and requires the FDIC to set the maximum within six months; small banks get a temporary assessment exemption.
Creates an additional layer of FDIC insurance specifically for aggregate noninterest-bearing transaction accounts (accounts that do not accrue interest and allow transfers or checks) on top of the existing standard maximum insurance amount. The FDIC must set the maximum additional insured amount within six months, must aggregate those accounts across subsidiaries of the same holding company, and is barred from changing or repealing that additional insurance limit except by Act of Congress. Smaller banks (those with $10 billion or less in assets) are temporarily exempt from certain special-assessment requirements during a transition period. Also defines “noninterest-bearing transaction account” in statute and makes a technical conforming change to an existing banking definition provision. The change expands deposit insurance coverage for certain transaction accounts while limiting the FDIC’s future rulemaking flexibility over that new coverage layer.