FDIC: Your deposit insurance rights

(Sheila Bair is the chairman of the Federal Deposit Insurance Corporation, which submitted the following to Reuters)

By Sheila Bair

WASHINGTON (Reuters.com) -- On Friday, July 11, IndyMac Bank located in Pasadena, California, was closed by its primary regulator, the Office of Thrift Supervision and placed under the management of the Federal Deposit Insurance Corporation. The overwhelming majority of IndyMac's depositors were fully insured and they continued to have access to their insured deposits throughout the weekend through check writing, ATM and debit cards until the FDIC reopened the institution on the following Monday with business as usual.

Notwithstanding the safety of their insured deposits, many IndyMac customers were anxious and frustrated in the days immediately following the closing. This shouldn't have been the case. Deposit insurance is a consumer right that every depositor should be aware of. As Chairman, I believe that the FDIC has a promise to keep to our nation's bank customers. A promise spelled out in the following Depositor Bill of Rights:

FDIC's Depositor's Bill of Rights

1) You have the right to automatic deposit insurance coverage when you open a deposit account at an FDIC-insured bank, with no additional cost or action on your part.

2) You have the right to separate FDIC insurance coverage for deposits held at different FDIC-insured banks.

3) You have the right to confirm that a bank is insured by using the FDIC's Bank Find service (ww4.fdic.gov/IDASP/main_bankfind.asp) or by calling the FDIC toll-free at 1-877-275-3342.

4) You have the right to deposit insurance coverage of $100,000 for your deposits at an FDIC-insured bank - up to $250,000 for your IRA deposits.

5) You have the right to deposit insurance coverage of more than $100,000 at a single bank when deposits are held in different "ownership categories," such as a single, joint and trust accounts.

6) You have the right to confirm that your deposits are within the insurance limits by using the FDIC's Electronic Deposit Insurance Estimator and other online resources at www.fdic.gov/deposit/deposits or by calling the FDIC at 1-877-275-3342.

7) You have the right to be informed when a financial product offered by your bank is not covered by FDIC insurance.

8) You have a right, if your bank fails, to prompt access to your insured deposits.

9) You have the right, if you are an uninsured depositor, to receive distributions from the receivership as the sale of assets permits.

10) You have the right to sleep well, knowing that since the creation of the FDIC 75 years ago, no depositor has ever lost one penny of insured deposits.

The banking system in this country remains on a solid footing through the guarantees provided by FDIC insurance. IndyMac was one of only 8,494 depository institutions operating throughout the country and represents only 0.2 percent of banking industry assets. The overwhelming majority of banks in this country are safe and sound and the chances that your own bank could fail are remote. However, if that does happen, the FDIC will be there -- as always -- to protect your insured deposits.