Before the creation of the FDIC, banks held as much as 25% capital against their assets, however with the creation of deposit insurance those ratios moved to approximately 6% and remained there until the recent crisis.

FORBES: Why More Bank Capital Won't Cure All The Economy's Ills

Two banks went bust in 1965, leading to calls for depositors to be made good by the government (which would then recover what it could from the liquidation of bank assets), for the introduction of deposit insurance and the creation of a government-backed industrial bank.

ECONOMIST: Hong Kong's economy

There were bankers who claimed the creation of federal deposit insurance would destroy the industry.

WHITEHOUSE: Moving Forward on a New Foundation