Protecting Your Deposits: The Role of the Federal Deposit Insurance Corporation (FDIC)

What is the main purpose of the Federal Deposit Insurance Corporation (FDIC)?

A. Regulating the stock market

B. Providing deposit insurance to U.S. bank depositors

C. Issuing currency

D. Supervising credit unions

Answer:

B. Providing deposit insurance to U.S. bank depositors

The main purpose of the Federal Deposit Insurance Corporation (FDIC) is to provide deposit insurance to U.S. bank depositors. This means that the FDIC insures deposits up to a certain amount per depositor, per insured bank, in the event of a bank failure.

Established in 1933 during the Great Depression, the FDIC aims to maintain stability and public confidence in the nation's banking system. It plays a crucial role in safeguarding the money of depositors by ensuring that their deposits are protected.

In addition to providing deposit insurance, the FDIC also supervises and regulates banks to ensure their safety and soundness. This involves conducting regular examinations of banks to assess their financial condition and compliance with banking laws and regulations.