Banks are lobbying Congress to extend the Transaction Account Guarantee (TAG) program, which insures bank deposits beyond the $250,000 covered by the Federal Deposit Insurance Corp., Reuters reports. Banks fear its expiration could lead companies to withdraw billions of dollars.
Regulators created the program during the 2008 financial crisis to reassure depositors, and Congress extended it in 2010. TAG is set to expire at the end of this year, and an extension would need to be drafted in the next three legislative weeks. The Independent Community Bankers of America wants a five-year extension for the program, which insures about $1.3 trillion held in accounts that do not pay interest at banks around the U.S.