To reform the Federal Deposit Insurance System, and for other purposes.

Summary: Amends the Federal Deposit Insurance Act to increase the standard maximum amount of deposit insurance from $100,000 to: (1) $500,000, at the option of the insured depository institution; and (2) $250,000 or $500,000 for eligible retirement accounts, at the institution's option. Requires an annual inflation adjustment.

Directs the Board of Directors of the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) Board to report to Congress and publish in the Federal Register any such inflation adjustments to the standard maximum deposit insurance amount and to the standard maximum share insurance amount.

SECTION 1. INCREASE IN DEPOSIT INSURANCE COVERAGE.

    (a) In General.--Section 11(a)(1) of the Federal Deposit Insurance 
Act (12 U.S.C. 1821(a)(1)) is amended--
            (1) by striking subparagraph (B) and inserting the 
        following new subparagraph:
                    ``(B) Net amount of insured deposit.--The net 
                amount due to any depositor at an insured depository 
                institution shall not exceed the standard maximum 
                deposit insurance amount as determined in accordance 
                with subparagraphs (C), (D), (E), and (F) and paragraph 
                (3).''; and
            (2) by adding at the end the following new subparagraphs:
                    ``(E) Standard maximum deposit insurance amount 
                defined.--For purposes of this Act--
                            ``(i) the term `standard maximum deposit 
                        insurance amount' means--
                                    ``(I) until the effective date of 
                                final regulations prescribed pursuant 
                                to section 9(a)(2) of the Federal 
                                Deposit Insurance Reform Act of 2005, 
                                $100,000; and
                                    ``(II) on and after such effective 
                                date, $100,000 or $500,000, at the 
                                option of the insured depository 
                                institution, and $250,000 or $500,000 
                                for eligible retirement accounts, at 
                                the option of the insured depository 
                                institution, adjusted as provided under 
                                subparagraph (F); and
                            ``(ii) the term `eligible retirement plan' 
                        has the same meaning as in section 402(c)(8)(B) 
                        of the Internal Revenue Code of 1986.
                    ``(F) Inflation adjustment.--
                            ``(i) In general.--By April 1 of 2009, and 
                        the 1st day of each subsequent 5-year period, 
                        the Board of Directors and the National Credit 
                        Union Administration Board shall jointly 
                        consider the factors set forth under clause 
                        (v), and, upon determining that an inflation 
                        adjustment is appropriate, shall jointly 
                        prescribe the amount by which the standard 
                        maximum deposit insurance amount and the 
                        standard maximum share insurance amount (as 
                        defined in 207(k) of the Federal Credit Union 
                        Act) applicable to any depositor at an insured 
                        depository institution shall be increased by 
                        calculating the product of--
                                    ``(I) $100,000 or $500,000, at the 
                                option of the insured depository 
                                institution, and $250,000 or $500,000 
                                for eligible retirement accounts, at 
                                the option of the insured depository 
                                institution; and
                                    ``(II) the ratio of the published 
                                annual value of the Personal 
                                Consumption Expenditures Chain-Type 
                                Price Index (or any successor index 
                                thereto), published by the Department 
                                of Commerce, for the calendar year 
                                preceding the year in which the 
                                adjustment is calculated under this 
                                clause, to the published annual value 
                                of such index as of the date this 
                                subparagraph takes effect. The values 
                                used in the calculation under subclause 
                                (II) shall be, as of the date of the 
                                calculation, the values most recently 
                                published by the Department of 
                                Commerce.
                            ``(ii) Rounding.--If the amount determined 
                        under clause (ii) for any period is not a 
                        multiple of $10,000, the amount so determined 
                        shall be rounded down to the nearest $10,000.
                            ``(iii) Publication and report to the 
                        congress.--Not later than April 5 of any 
                        calendar year in which an adjustment is 
                        required to be calculated under clause (i) to 
                        the standard maximum deposit insurance amount 
                        and the standard maximum share insurance amount 
                        under such clause, the Board of Directors and 
                        the National Credit Union Administration Board 
                        shall--
                                    ``(I) publish in the Federal 
                                Register the standard maximum deposit 
                                insurance amount, the standard maximum 
                                share insurance amount, and the amount 
                                of coverage under paragraph (3)(A) and 
                                section 207(k)(3) of the Federal Credit 
                                Union Act, as so calculated; and
                                    ``(II) jointly submit a report to 
                                the Congress containing the amounts 
                                described in subclause (I).
                            ``(iv) 6-month implementation period.--
                        Unless an Act of Congress enacted before July 1 
                        of the calendar year in which an adjustment is 
                        required to be calculated under clause (i) 
                        provides otherwise, the increase in the 
                        standard maximum deposit insurance amount and 
                        the standard maximum share insurance amount 
                        shall take effect on January 1 of the year 
                        immediately succeeding such calendar year.''.