Main Street Depositor Protection Act

This bill amends the Federal Deposit Insurance Act and the Federal Credit Union Act to provide additional deposit insurance coverage of up to $10,000,000 for noninterest-bearing transaction accounts at insured depository institutions and credit unions, with certain exclusions and a transition period.

Sec. 2, Transaction account insurance: For depository institutions, the bill adds a new insurance tier for noninterest-bearing transaction accounts, covering up to $10,000,000 per depositor in aggregate across accounts at the same institution, and aggregates deposits across subsidiaries of a single holding company. It excludes coverage for accounts at institutions that are subsidiaries of a bank holding company identified as a global systemically important BHC, and at insured branches of foreign banks. It also defines "noninterest-bearing transaction account" as an account with no interest, allowing withdrawals by negotiable instruments or electronic transfers for payments to third parties, and without requiring advance notice. During a transition period, institutions with total assets of $10,000,000,000 or less are exempt from special assessments or assessment increases solely due to this extended insurance.

For credit unions, the bill similarly provides up to $10,000,000 in insurance for noninterest-bearing transaction accounts, and defines the term consistently. It adds a definition of "noninterest-bearing transaction account" to the Federal Credit Union Act.

Transition period: The FDIC must publish a plan within one year to gradually include these insured deposits in the calculation of estimated insured deposits over a 10-year period, reaching 100% at the end. The NCUA Board must publish a similar plan for credit unions, and may issue regulations to keep the Share Insurance Fund well-capitalized.

Regulations: The FDIC and NCUA may issue rules to prevent evasion of the insurance limits, ensuring coverage only applies to noninterest-bearing transaction accounts, at institutions not excluded, and at insured credit unions.