What is the role of the FDIC?

The Federal Deposit Insurance Corporation (FDIC) plays a crucial role in maintaining public confidence in the U.S. financial system by insuring deposits held in member banks. Specifically, the FDIC provides insurance coverage for savings bank deposits, which means that if an FDIC-insured bank fails, the deposits of the customers up to a specified limit (currently $250,000 per depositor, per bank) are protected. This insurance is vital for safeguarding consumer savings and encouraging people to place their funds in banks, thereby promoting stability within the banking system.

The other options do not accurately describe the FDIC's primary functions. For instance, while the FDIC does protect depositors, it does not guarantee loans made by banks. Additionally, it does not regulate interest rates among banks; that falls under the purview of the Federal Reserve. Lastly, the FDIC has no role in overseeing international bank transactions, as its focus is primarily on domestic deposit insurance and maintaining public confidence in the banking system.