In an expected move, the board of the Federal Deposit Insurance Corp. unanimously approved a 3-year prepayment by banks to the tune of $45 billion in order to put liquidity back into the Deposit Insurance Fund, which ran out of money in the third quarter, and has been running at a deficit ever since.

The overall banking industry hasn’t fought against the move, saying it was less expensive than some of the alternatives out there. One difference the Independent Community Bankers of America asked for was for assessments to be under a two-year requirement, with an option for a third year if needed. That was rejected at the board meeting.

Some concerns were that the cash could have been used in a better way by the banks, focusing on growth and expansion rather than on defensive tactics. Another reason for the banks supporting prepayments is they are considered an asset until the point where they must pay it for the quarter it is due over the following three years.

With the fund running at a deficit, the FDIC had to build it up again to meet the requirement of 1.15 percent of the fund’s balance divided by its insured deposits, which was a paltry 0.22 percent as of June 30. Up to $250,000 is insured by the DIF at this time.

FDIC chairman Sheila Bair has been strongly behind this push, as she has resisted going the route of tapping into the huge Treasury credit line the FDIC has, with power struggles between the agencies and other factors make it the last resort for her and the FDIC.

Bair has said in the past and reiterated at the meeting that this will take care of short-term liquidity needs of the Deposit Insurance Fund without putting too much strain on the banking industry.

But if there is some downward pressure on the bank concerning liquidity or “extraordinary hardship” from the premiums due, the banks can request an exemption from prepayment from the FDIC for that quarter. The payment is scheduled for December 30 every quarter for the duration of the three-year period.

A total of 120 banks have been shuttered so far this year, with another 416 considered at high risk of failing as of June 30. That could in reality be a very low estimate of the reality, but time will tell as things unfold. Estimates for bank failures through 2013 come in at about $100 billion.