<P> A bank's chartering authority--either an individual state banking department or the U.S. Office of the Comptroller of the Currency--closes a bank and appoints the FDIC as receiver . In its role as a receiver the FDIC is tasked with protecting the depositors and maximizing the recoveries for the creditors of the failed institution . The FDIC does not close banks . </P> <P> The FDIC as receiver is functionally and legally separate from the FDIC acting in its corporate role as deposit insurer, and the FDIC as receiver has separate rights, duties, and obligations from those of the FDIC as insurer . Courts have long recognized these dual and separate capacities . </P> <P> In 1991, to comply with legislation, the FDIC amended its failure resolution procedures to decrease the costs to the deposit insurance funds . The procedures require the FDIC to choose the resolution alternative that is least costly to the deposit insurance fund of all possible methods for resolving the failed institution . Bids are submitted to the FDIC where they are reviewed and the least cost determination is made . </P> <P> A receivership is designed to market the assets of a failed institution, liquidate them, and distribute the proceeds to the institution's creditors . The FDIC as receiver succeeds to the rights, powers, and privileges of the institution and its stockholders, officers, and directors . The FDIC may collect all obligations and money due to the institution, preserve or liquidate its assets and property, and perform any other function of the institution consistent with its appointment . </P>

The primary purpose of both the fdic and the savings association insurance fund is to