the federal insurance corporation was formed in 1933. the FDIC is a corporation operating as an independent agency created by the Glass-Steagall Act. it guaranteed safety of deposit in member banks up to $250,000 for each deposit owner. the FDIC also supervises financial institution for safety. the FDIC doesn't provide insurance for credit unions. Bank runs were common because there was not insurance on deposits at banks, banks kept only a fraction of deposits in reserve, and customers ran the risk of losing the money that they had deposited if their bank failed.
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