For maintaining depositor confidence, the fund is required to be robust enough to meet claims arising out of routine failure of banks under normal situations. Going by the past record of failures, the fund maintained by DICGC appears adequate.
But it is not clear that the fund will be able to meet claims arising from the putative failure of a couple of small or medium size commercial  BIS central bankers’ speeches  5  banks. Admittedly, no deposit insurer can maintain enough liquid funds to face a widespread financial crisis.