"Push for Higher FDIC Insurance Cap Gains Momentum"

Lawmakers in the US are considering raising the federal insurance limit on bank deposits to prevent a financial crisis caused by a drain of large, uninsured deposits away from smaller and regional banks. The current limit is $250,000 per depositor, but some lawmakers believe this may not be enough. The new limit could be $2 million, $5 million, or $10 million. The FDIC temporarily backstopped all deposits during the 2008 financial crisis, and some former officials have suggested regulators may need to repeat this. However, higher deposit insurance limits could increase the moral hazard of risk-taking in the financial sector.