Regulators may borrow billions from big banks to shore up the dwindling fund that insures regular deposit accounts.


The loans would go to the fund maintained by the Federal Deposit Insurance Corp. that insure depositors when banks fail, said one industry and one government official familiar with the FDIC board's thinking, who requested anonymity because the plans are still evolving.

Regulators also are considering levying a special emergency fee on all banks, charging regular fees early or tapping a $100 billion credit line with the U.S. Treasury, the officials said.

The fund, which insures deposit accounts up to $250,000, is at its lowest point since 1992, at the height of the savings-and-loan crisis. Ongoing losses on commercial real estate and other loans continue to cause multiple bank failures each week.

FDIC Chairman Sheila Bair wants to avoid tapping the Treasury credit line, and Treasury officials insist that the strongest big banks have enough extra capital to operate, the officials said. Comptroller of the Currency John Dugan, who is a voting member of the FDIC board, has said he doesn't want to levy another fee on banks while the industry is still recovering.

The loans would give big, healthy banks a safe harbor for their money and would limit their risk-taking, said Daniel Alpert, managing director of the investment bank Westwood Capital LLC in New York.

It also would allow the industry's strongest players — which still rely on FDIC loan guarantees and other emergency subsidies — to help weaker banks avoid paying another fee, he said.