The Board of Directors (Board) of the Federal Deposit Insurance Corporation (FDIC) is amending the FDIC's regulation on assessments to establish a new assessment rate schedule of 4 to 31 basis points for institutions whose deposits are subject to assessment by the Bank Insurance Fund (BIF). In addition, the Board is amending the assessment schedule to widen the existing assessment rate spread from 8 basis points to 27 basis points. The Board is further amending the assessments regulation to establish a procedure for adjusting the rate schedule semiannually as necessary to maintain the designated reserve ratio (DRR) at 1.25 percent. The Board is adopting the new assessment schedule to satisfy the requirements of section 7(b) of the Federal Deposit Insurance Act that, once the reserve ratio of the BIF reaches the DRR of 1.25 percent of total estimated insured deposits, rates be set to maintain the DRR. The new schedule will apply to the semiannual period in which the DRR has been achieved (which is expected to occur in the second quarter of 1995) and to semiannual periods thereafter, subject to modification semiannually by the FDIC. Specifically, the new assessment schedule, which will reduce BIF assessment rates for all but the riskiest institutions, will become effective on the first day of the month after the month in which the DRR is achieved. Assessments collected at the previous assessment schedule that exceed the amount due under the new schedule will be refunded, with interest, from the effective date of the new schedule.