The FDIC's Role in Bank Stability and Bailouts.

The FDIC's Deposit Insurance Fund guarantees depositors' money up to $250,000, but if a failed bank is deemed "systemically important," its depositors can be paid out for balances exceeding that cap. The Biden administration argues that this backstop move doesn't constitute a bailout because the Deposit Insurance Fund is supported by fees charged to financial institutions, not taxpayer money. However, this exception is only triggered if regulators determine a bank meets certain criteria indicating potentially systemic risk from a collapse, and depositors at other banks may not be guaranteed such robust protections.