<Li> Significantly undercapitalized: less than 6% </Li> <Li> Critically undercapitalized: less than 2% </Li> <P> When a bank becomes undercapitalized, the institution's primary regulator issues a warning to the bank . When the number drops below 6%, the primary regulator can change management and force the bank to take other corrective action . When the bank becomes critically undercapitalized the chartering authority closes the institution and appoints the FDIC as receiver of the bank . </P> <P> At Q4 2010 884 banks had very low capital cushions against risk and were on the FDIC's "problem list". </P>

The federal depository insurance corporation (fdic) has the power to close a bank when