Midsize banks are reportedly requesting the FDIC to insure all deposits for two years, per Bloomberg.

The Mid-Size Bank Coalition of America (MBCA) has reportedly asked United States federal regulators to extend insurance on all deposits for the next two years.

“Doing so will immediately halt the exodus of deposits from smaller banks, stabilize the banking sector and greatly reduce chances of more bank failures,” the Mid-Size Bank Coalition of America said in a letter to regulators seen by Bloomberg News.

“Notwithstanding the overall health and safety of the banking industry, confidence has been eroded in all but the largest banks,” the group said in the letter. “Confidence in our banking system as a whole must be immediately restored,” it said, adding that the deposit flight would accelerate should another bank fail.

Recently Yellen said: Deposits in US. Banks will be guaranteed only if a systemic risk determination is issued.

Yellen said: “A bank only gets that treatment if a majority of the FDIC board, a supermajority of the Fed board, and I in consultation with the president, determine that the failure to protect uninsured depositors would create systemic risk and significant economic and financial consequences.”

“I can reassure the members of the committee that our banking system is sound and that Americans can feel confident that their deposits will be there when they need them,” Yellen said in her opening remarks. “This week’s actions demonstrate our resolute commitment to ensure that our financial system remains strong and depositors’ savings remain safe.”

“The government took decisive and forceful actions to strengthen public confidence in our banking system,” she said. “On Monday morning, customers were able to access all of the money in their deposit accounts so they could make payroll and pay the bills.”

Read more: https://unusualwhales.com/news/yellen-deposits-in-us-banks-will-be-guaranteed-only-if-a-systemic-risk-determination-is-issued