The Designated Reserve Ratio is a rule that stipulates that highly-rated DIs would not pay deposit insurance premiums if this ratio was above 1.25 percent.

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The statement is true. The Designated Reserve Ratio is a ratio set by the FDIC that represents the minimum amount of reserves that a DI must hold against its deposit liabilities. Highly-rated DIs that maintain reserves above this ratio do not have to pay deposit insurance premiums. As of 2021, the designated reserve ratio is set at 2 percent.

The Designated Reserve Ratio Is a Rule That Stipulates That