Write about Federal Deposit Insurance Corporation (FDIC)

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Federal Deposit Insurance Corporation (FDIC)
The FDIC is a US government corporation that was formed to provide deposit insurance services to bank depositors (Federal Deposit Insurance Corporation 3). The great depression between the late 1890s and the early 1930s led to the creation of the corporation in the year 1933 (Getter 6). The aim of the corporation was to restore the trust of the overall public in the American banking system, considering that at least a third of the banks failed during the depression, resulting in a high number of bank runs, threatening the banking industry (Federal Deposit Insurance Corporation 7). There existed widespread panic by the public on the banking system, with the most troubled being banks in rural areas because many depositors opted to withdraw their deposits (Klein and Barth 191).
When the proposal for establishing the corporation was made in the 1930s, the then US president, Franklin Roosevelt was against the idea as he argued that the government could not be held responsible for the flaws of individual banks (Federal Deposit Insurance Corporation 3). However, the overwhelming public support made the proposal a success, with bank failures dropping to near zero after the formation of the corporation (Gonzales and Getter 5). The banking act of 1935 sealed the status of the corporation by making it a permanent government agency with roles such as to provide permanent deposit insurance to banks at a maintained level of $5000 (Gonzales and Getter 6). The agency was given authority to provide deposit insurance to financial institutions and regulate non-member banks. The corporation's operations were funded by the government through loans amounting to $289 million, and that was to be paid back with an agreed interest (Federal Deposit Insurance Corporation 2). In general, the FDIC was created to mitigate any possible danger to the US economy through provision of deposit insurances to all financial institutions (Getter 11).
The federal law of the US requires that the FDIC pays a hundred percent of the clients insured d...