In an article in Saturday's Business section, the maximum premium paid to the Federal Deposit Insurance Corp. by banks was misstated. Banks currently pay one-twelfth of one percent of deposits.
The number of high-risk and troubled banks insured by the Federal Deposit Insurance Corp. would nearly double under a new insurance program proposed yesterday by the federal agency.
About 1,800, or 13 percent, of the nation's banks would be classified as having higher than normal risks under the FDIC proposal, which would charge higher insurance premiums to banks classified as having higher risks. Premiums could be up to four times the size of the premiums charged banks considered to have normal risk.
The higher premium would help pay the cost of extra FDIC examinations. Currently, all banks are subject to the same maximum premium of 1/2 of one percent of deposits.
While there is widespread support in the banking industry for changing the uniform insurance system to relieve the financially sound institutions of having to subsidize the weaker ones, no consensus has been reached on the best method. Federal Reserve Chairman Paul A. Volcker and the Comptroller of the Currency are discussing the idea of increasing capital requirements based on risk levels. The Federal Home Loan Bank Board would gauge risk by the type of activities in which a savings institution engages.
The FDIC has devised a system that would require two independent tests for a bank to be classified as above normal risk. One is based on the existing procedure for on-site examination and the other is a new statistical analysis using six financial variables. A bank must fail both tests before it is placed in the high risk category.
Regulators currently give banks a so-called CAMEL rating based on capital adequacy, asset quality, management, earnings and liquidity. The ratings range from 1 to 5, with 1 the best. Banks rated 3, 4 or 5 are usually said to be on the problem list, meaning that they require extra supervision or, in the extreme, are likely to fail.
The proposed statistical analysis would compute as a percentage of assets the following factors: Primary capital, loans more than 90 days past due, nonaccruing loans, renegotiated debt, net charge offs and net income. The FDIC would determine a threshold above which banks would be judged riskier.
The FDIC declined to say at this point whether the information about ratings or higher insurance premiums would be made public and in what form. However, a former bank examiner said it was likely that analysts and other interested persons would soon be able to use the data to discover which banks are riskier than others.
Details of the plan were sent to the chief executive officers of all FDIC-insured banks yesterday and their comments requested. If legislation is enacted, the plan could go into effect at the start of 1987.