Tyler Cowen of the blog Marginal Revolution has an op/ed in todays New York Times concerning the growing calls for the government to step in and break up banks that have been called “Too Big To Fail”.

Cowen:

…the logic of cutting down huge institutions could mean splitting the largest ones into several pieces. Yet banks do not always come in easily divisible parts. Such a move could amount to eradicating the largest banks rather than splitting them up — and eradication is both politically unlikely and potentially disastrous for the economy. In short, if the resulting parts of a divided bank cannot turn a profit, the split-up may prompt the very bailout it was trying to avoid.

Cowen then goes on to cite a recent paper written by Eugene White of Rutgers. White succinctly summarizes the last century of bank runs and growth of government legislation to curb excess.

White closes his paper with the following point:

The most common argument is that banking is far more complex than in the nineteenth century. Yet, its very complexity is an outcome of the efforts to regulate the choices that banks, with management and skilled professionals designing new instruments and trading procedures to circumvent the rules.

People in my life have said that I have a very pessimistic view of the innate  good of my fellow human beings. Probably because of this, I disagree with Cowen and White on a great many of their points. I do agree that regulations are becoming unwieldy and will likely come to a point where they completely hinder the growth of capital.

 
Cowen contends that rather than putting our faith in the central bank or a regulatory agency, extending the liability on bank shareholders would be the best course of action.

Money quote:

Expanded liability for bank shareholders might satisfy the Occupy Wall Street movement, and could be sold as a market-oriented, not regulatory solution; it’s probably what markets would insist upon if there were no central bank and no F.D.I.C. As recently as the 1980s, the partnership structure, another alternative to limited liability, was common among investment banks — and that hardly seemed a crippling drawback at the time.

 

Cowen writes well, it is obvious that he has spent a great amount of time studying this subject. I feel it neccesary to reply in two points, however. First, I do not agree that purely because breaking up a bank is hard and  requires time and effort it should be discounted. I am sure that a great many industrialists said the same thing of US Steel or Standard Oil.

Secondly, the argument that shareholders and a proper risk management department are preferred to a regulatory agency may make bank’s feel like they’re more liable, but they’re really not. Supposing that the shareholders form together on an ill-advised path that makes them a great amount of money, but ends up closing the bank and losing a lot of non-shareholders their money in the bank? Who speaks for the consumer?

The continuing necessity for a bank insurance agent (the FDIC) will always be neccesary in a competitive banking environment and while we can debate the merits of regulatory reform, the safety that the FDIC has provided to the consumer has arguably driven average investment in the very banks that Cowen and White would seek to self-regulate.

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Press Release

Barrington Bank & Trust Company, National Association, Barrington, Illinois, Assumes All of the Deposits of Charter National Bank and Trust, Hoffman Estates, Illinois 
 

FOR IMMEDIATE RELEASE
February 10, 2012
Media Contact:
Greg Hernandez (202) 898-6984
Cell: (202) 340-4922
Email: ghernandez@fdic.gov

 

Charter National Bank and Trust, Hoffman Estates, Illinois, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Barrington Bank & Trust Company, National Association, Barrington, Illinois, to assume all of the deposits of Charter National Bank and Trust.

The two branches of Charter National Bank and Trust will reopen on Saturday as Hoffman Estates Community Bank, a branch of Barrington Bank & Trust Company, National Association. Depositors of Charter National Bank and Trust will automatically become depositors of Barrington Bank & Trust Company, National Association. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of Charter National Bank and Trust should continue to use their existing branch until they receive notice from Barrington Bank & Trust Company, National Association that it has completed systems changes to allow other Barrington Bank & Trust Company, National Association branches to process their accounts as well.

This evening and over the weekend, depositors of Charter National Bank and Trust can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of December 31, 2011, Charter National Bank and Trust had approximately $93.9 million in total assets and $89.5 million in total deposits. In addition to assuming all of the deposits of the failed bank, Barrington Bank & Trust Company, National Association agreed to purchase essentially all of the assets.

The FDIC and Barrington Bank & Trust Company, National Association entered into a loss-share transaction on $72.1 million of Charter National Bank and Trust’s assets. Barrington Bank & Trust Company, National Association will share in the losses on the asset pools covered under the loss-share agreement. The loss-share transaction is projected to maximize returns on the assets covered by keeping them in the private sector. The transaction also is expected to minimize disruptions for loan customers. For more information on loss share, please visit: http://www.fdic.gov/bank/individual/failed/lossshare/index.html.

Customers with questions about today’s transaction should call the FDIC toll-free at 1-800-517-1843. The phone number will be operational this evening until 9:00 p.m., Central Standard Time (CST); on Saturday from 9:00 a.m. to 6:00 p.m., CST; on Sunday from noon to 6:00 p.m., CST; on Monday from 8 a.m. to 8 p.m., CST; and thereafter from 9:00 a.m. to 5:00 p.m., CST. Interested parties also can visit the FDIC’s Web site athttp://www.fdic.gov/bank/individual/failed/cnbt.html.

As part of this transaction, the FDIC will acquire a value appreciation instrument. This instrument serves as additional consideration for the transaction.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $17.4 million. Compared to other alternatives, Barrington Bank & Trust Company, National Association’s acquisition was the least costly resolution for the FDIC’s DIF. Charter National Bank and Trust is the eighth FDIC-insured institution to fail in the nation this year, and the first in Illinois. The last FDIC-insured institution closed in the state was All American Bank, Des Plaines, on October 28, 2011.

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Press Release

First Merchants Bank, National Association, Muncie, Indiana, Assumes All of the Deposits of SCB Bank, Shelbyville, Indiana 

FOR IMMEDIATE RELEASE
February 10, 2012
Media Contact:
Greg Hernandez (202) 898-6984
Cell: (202) 340-4922
Email: ghernandez@fdic.gov

 

SCB Bank, Shelbyville, Indiana, was closed today by the Office of the Comptroller of the Currency, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Merchants Bank, National Association, Muncie, Indiana, to assume all of the deposits of SCB Bank.

The four branches of SCB Bank will reopen on Saturday as branches of First Merchants Bank, National Association. Depositors of SCB Bank will automatically become depositors of First Merchants Bank, National Association. Deposits will continue to be insured by the FDIC, so there is no need for customers to change their banking relationship in order to retain their deposit insurance coverage up to applicable limits. Customers of SCB Bank should continue to use their existing branch until they receive notice from First Merchants Bank, National Association that it has completed systems changes to allow other First Merchants Bank, National Association branches to process their accounts as well.

This evening and over the weekend, depositors of SCB Bank can access their money by writing checks or using ATM or debit cards. Checks drawn on the bank will continue to be processed. Loan customers should continue to make their payments as usual.

As of December 31, 2011, SCB Bank had approximately $182.6 million in total assets and $171.6 million in total deposits. In addition to assuming all of the deposits of the failed bank, First Merchants Bank National Association agreed to purchase essentially all of the assets.

Customers with questions about today’s transaction should call the FDIC toll-free at 1-800-517-8236. The phone number will be operational this evening until 9:00 p.m., Eastern Standard Time (EST); on Saturday from 9:00 a.m. to 6:00 p.m., EST; on Sunday from noon to 6:00 p.m., EST; on Monday from 8 a.m. to 8 p.m., EST; and thereafter from 9:00 a.m. to 5:00 p.m., EST. Interested parties also can visit the FDIC’s Web site athttp://www.fdic.gov/bank/individual/failed/scbbank.html.

The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $33.9 million. Compared to other alternatives, First Merchants Bank, National Association’s acquisition was the least costly resolution for the FDIC’s DIF. SCB Bank is the ninth FDIC-insured institution to fail in the nation this year, and the first in Indiana. The last FDIC-insured institution closed in the state was Integra Bank, National Association, Evansville, on July 29, 2011.

Stephen  Lubben at the New York Times blog Dealbook reports on the demand of at least one consumer group to go Standard Oil/ US Steel on Bank of America.

Money quote:

In a petition to Treasury Secretary Timothy F. Geithner and Ben S. Bernanke, chairman of the Federal Reserve — who are the chairman and vice chairman of the Financial Stability Oversight Council, respectively — the group argues that the bank is too big to be either governed or regulated, and represents a real risk to the financial system. They are urging Mr. Geithner and Mr. Bernanke to use their power under Dodd-Frank to dismantle the bank, in a manner somewhat reminiscent of the breakup of AT&T three decades ago.

In New York Times Op-Ed today, contributor Amar Bhide calls for a return to the good old days of the Glass-Steagall. I take issue with Bhide’s following assertion however:

The Federal Deposit Insurance Corporation now covers balances up to a $250,000 limit, but this does nothing to reassure large depositors, whose withdrawals could cause the system to collapse. In fact, an overwhelming proportion of the “quick cash” in the global financial system is uninsured and prone to manic-depressive behavior, swinging unpredictably from thoughtless yield-chasing to extreme risk aversion. Much of this flighty cash finds its way into banks through lightly regulated vehicles like certificates of deposits or repurchase agreements. Money market funds, like banks, are a repository for cash, but are uninsured and largely unexamined.

This argument feels like it is trying to connect two unrelated points. Yes, cheap quick cash is all around in banking, and there is a danger in failure, but the $250K limit problem seems to me a wish to create a problem where none exists currently. No customer has ever lost a cent of FDIC insured funds in 80 years.

What do you think, dear readers?

In what had to be expected, yet no less frightening news, the Federal Reserve Board published their standards on implementing new key areas of the Dodd-Frank reform.

Per American Banker Magazine:

The Federal Reserve Board’s 173-page proposal — considered by industry analysts to be the core of new rules required by the Dodd-Frank Act — would apply to all bank holding companies with more than $50 billion of assets as well as nonbank financial firms designated as systemically important by the Financial Stability Oversight Council.

This is important twofold; first for the obvious reason that these new opnions written by the regulators will like ly be the gospel by which all the federal examiners are to bring to the heathen banks with more than 50 billion in assets. A new set of marching orders will likely be out soon as well for mid size holding companies, adding to the regulatory reform that has already been published on the subject. Secondly, this is going to be interesting to see how these statutes impact actual business. If this has real impact then it will have succeeded where many had hoped it would fail. Otherwise it is simply another giant tome on top of a compliance official’s desk.

 

Press Release

FDIC Makes Public October Enforcement Actions; One Administrative Hearing Scheduled for December 2011

FOR IMMEDIATE RELEASE
November 25, 2011
Media Contact:
LaJuan Williams-Young
Office: (202) 898-3876
Email: lwilliams-young@fdic.gov

 

The Federal Deposit Insurance Corporation (FDIC) today released a list of orders of administrative enforcement actions taken against banks and individuals in October. One administrative hearing is scheduled for December 2011.

The FDIC issued a total of 75 orders and one notice in October. The orders included: 17 consent orders; 11 removal and prohibition orders; one cross guarantee liability; 29 civil money penalties; one prompt corrective action; thirteen orders terminating consent orders and cease and desist orders; and three orders terminating a supervisory prompt corrective action directive. The following notice was issued: a notice of intention to remove from office and/or to prohibit from further participation, notice of assessment of civil money penalties, findings of fact and conclusions of law, orders to pay, and notice of hearing.

Copies of the orders referred to above can be obtained from or inspected at the FDIC’s Public Information Center, 3501 Fairfax Drive, Room E-1002, Arlington, VA (telephone 703-562-2200 or 1-877-275-3342). To view individual orders below, click the link for the PDF next to the order. To view all orders online, visit the FDIC’s Web page at http://www.fdic.gov/bank/individual/enforcement/index.html. A list of orders made public today follows.

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FINAL ORDERS ISSUED PURSUANT TO SECTION 8(b), 12 U.S.C. § 1818(b) (Consent Orders)

First Community Bank, Santa Rosa, CA; FDIC-11-428b; Issued 10/20/11 – PDF

State Bank of Georgia, Fayetteville , GA; FDIC-11-311b; Issued 10/4/11 – PDF

Town Center Bank, Frankfort, IL; FDIC-11-335b; Issued 10/12/11 – PDF

Grabill Bank, Grabill, IN; FDIC-11-338b; Issued 10/25/11 – PDF

Regal Bank and Trust, Owings Mills , MD; FDIC-11-423b; Issued 10/26/11 – PDF

First Independence Bank, Detroit, MI; FDIC-11-449b; Issued 10/25/11 – PDF

Commerce Bank, Geneva, MN; FDIC-11-380b; Issued 10/12/11 – PDF

Omni Bank, Mantee, MS; FDIC-11-329b; Issued 10/12/11 – PDF

The Wilmington Savings Bank, Wilmington, OH; FDIC-11-376b; Issued 10/26/11 – PDF

West Coast Bank, Lake Oswego, OR; FDIC-11-466b; FDIC-11-468k; Issued 10/11/11 – PDF

CoastalStates Bank, Hilton Head Island, SC; FDIC-11-275b; Issued 10/12/11 – PDF

Libertad Bank, SSB, Austin, TX; FDIC-11-368b; Issued 10/13/11 – PDF

Libertad Bank, SSB, Austin, TX; FDIC-11-477b; Issued 10/6/11 – PDF

Fort Davis State Bank, Fort Davis, TX; FDIC-11-535b; Issued 10/31/11 – PDF

Seattle Bank, Seattle, WA; FDIC-11-403b; FDIC-11-363k; Issued 10/17/11 – PDF

Bank of Wausau, Wausau, WI; FDIC-10-488b; Issued 10/28/11 – PDF

Bank of Wausau, Wausau, WI; FDIC-11-351b; Issued 10/12/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(e), 12 U.S.C. § 1818(e) (Removal and Prohibition Orders)

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; against John M. Cinderey; Issued 10/7/11 – PDF

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; against Richard L. Swartz; Issued 10/7/11 – PDF

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; against Lawrence M. Zhang; Issued 10/7/11 – PDF

Dime Bank, Norwich, CT; FDIC-11-102e; against Philip J. Mongillo; Issued 10/7/11 – PDF

The Citizens State Bank of Taylor County, Reynolds, GA; FDIC-11-443e; FDIC-11-444k; against Beverly H. Poore; Issued 10/7/11 – PDF

 

Mid-Missouri Bank, Springfield, MO; FDIC-10-084e; against Scott B. Rosenthal; Issued 10/20/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-086e; against K. Chris Couch; Issued 10/20/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-088e; against Frank B. McReynolds; Issued 10/20/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-090e; against Kayla Muskrat; Issued 10/20/11 – PDF

Clarion County Community Bank, Clarion, PA; FDIC-11-366e; against Tami L. Toy; Issued 10/20/11 – PDF

Prosperity Bank, El Campo, TX; FDIC-11-195e; against Jennifer Herrera; Issued 10/7/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 5(e), 12 U.S.C. § 1815(e) (Cross Guarantee Liability)

Bank of Las Colinas, Irving, Texas; FDIC-11-427kk; Issued 10/21/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 8(i), 12 U.S.C. § 1818(i) (Civil Money Penalties)

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; Order of Prohibition From Further Participation and Order to Pay against John M. Cinderey in the amount of $40,000.00; Issued 10/7/11 – PDF

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; Order of Prohibition From Further Participation and Order to Pay against Richard L. Swartz in the amount of $12,500.00; Issued 10/7/11 – PDF

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; Order of Prohibition From Further Participation and Order to Pay against Lawrence M. Zhang in the amount of $35,000.00; Issued 10/7/11 – PDF

Valley Business Bank, Visalia, CA; FDIC-11-493k; in the amount of $12,600.00; Issued 10/11/11 – PDF

Rocky Mountain Bank & Trust Florence, Florence, CO; FDIC-11-301k; against Douglas L. McClure in the amount of $30,000.00; Issued 10/7/11 – PDF

Rocky Mountain Bank & Trust Florence, Florence, CO; FDIC-11-302k; against Marty K. Burleson in the amount of $25,000.00; Issued 10/7/11 – PDF

Rocky Mountain Bank & Trust Florence, Florence, CO; FDIC-11-303k; against Duane Hays in the amount of $25,000.00; Issued 10/7/11 – PDF

Rocky Mountain Bank & Trust Florence, Florence, CO; FDIC-11-304k; against Gerald L. Montney in the amount of $25,000.00; Issued 10/7/11 – PDF

Barclays Bank Delaware, Wilmington, DE; FDIC-11-171k; in the amount of $425,000.00; Issued 9/2/11 – PDF

Gateway Bank of Southwest Florida, Sarasota, FL; FDIC-11-437k; in the amount of $5,000.00; Issued 10/5/11 – PDF

The Citizens State Bank of Taylor County, Reynolds, GA; FDIC-11-443e; FDIC-11-444k; Order of Prohibition From Further Participation and an Order to Pay against Beverly H. Poore in the amount of $10,000.00; Issued 10/7/11 – PDF

The Citizens Bank, Nashville, GA; FDIC-11-418k; in the amount of $7,000.00; Issued 10/6/11 – PDF

First State Bank, Stuart, IA; FDIC-11-459k; in the amount of $2,000.00; Issued 10/13/11 – PDF

Magnolia Bank, Incorporated, Hodgenville, KY; FDIC-11-318k; in the amount of $26,000.00; Issued 10/31/11 – PDF

The Dart Bank, Mason, MI; FDIC-11-222k; in the amount of $7,750.00; Issued 10/25/11 – PDF

Monroe Bank & Trust, Monroe, MI; FDIC-11-392k; in the amount of $11,000.00; Issued 10/26/11 – PDF

Triad Bank, Frontenac, MO; FDIC-11-451k; in the amount of $2,800.00; Issued 10/7/11 – PDF

Triad Bank, Frontenac, MO; FDIC-11-452k; in the amount of $2,500.00; Issued 10/7/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-085k; against Scott B. Rosenthal in the amount of $62,500.00; Issued 10/20/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-087k; against K. Chris Couch in the amount of $50,000.00; Issued 10/20/11 – PDF

Mid-Missouri Bank, Springfield, MO; FDIC-10-089k; against Frank B. McReynolds in the amount of $13,500.00; Issued 10/20/11 – PDF

Emigrant Bank, New York, NY; FDIC-11-506k; in the amount of $21,650.00; Issued 10/5/11 – PDF

Israel Discount Bank of New York, New York, NY; FDIC-11-487k; in the amount of $2,500.00; Issued: 10/17/11 – PDF

The First Bexley Bank, Bexley, OH; FDIC-11-197k; in the amount of $1,350.00; Issued 10/6/11 – PDF

West Coast Bank, Lake Oswego, OR; FDIC-11-466b; FDIC-11-468k; Consent Order, Order for Restitution, and Order to Pay in the amount of $390,000.00; Issued 10/11/11 – PDF

Reliance Savings Bank, Altoona, PA; FDIC-11-537k; in the amount of $12,000.00; Issued 10/26/11 – PDF

Castroville State Bank, Castroville, TX; FDIC-11-347k; in the amount of $1,500.00; Issued 10/19/11 – PDF

Spirit of Texas Bank, SSB, College Station, TX; FDIC-11-349k; in the amount of $4,400.00; Issued 10/12/11 – PDF

Seattle Bank, Seattle, WA; FDIC-11-403b; FDIC-11-363k; Consent Order for Restitution and Order to Pay in the amount of $40,000.00; Issued 10/17/11 – PDF

FINAL ORDERS ISSUED PURSUANT TO SECTION 38, 12 U.S.C. § 1831o (Prompt Corrective Action)

Country Bank, Aledo, IL; FDIC-11-555PCAS; Issued 10/5/11 – PDF

TERMINATIONS

Orders Terminating Consent Orders and Cease and Desist Orders

Ventura County Business Bank, Oxnard, CA; Cert. No. 57441; Merged Into and Now Known As: Royal Business Bank, Los Angeles, CA; Cert. No. 58816; FDIC-09-374b; Issued 10/24/11 – PDF

Golden Security Bank, Rosemead, CA; Cert. No. 26615; Merged Into and Now Known As: First General Bank; Rowland Heights, CA; Cert. No. 58060; FDIC-09-108b; Issued 10/24/11 – PDF

Piedmont Community Bank, Gray, GA; FDIC-08-348b; Issued 10/28/11 – PDF

The Tattnall Bank, Reidsville, GA; FDIC-08-349b; Issued 10/28/11 – PDF

Creekside Bank, Woodstock, GA; FDIC-09-529b; Issued 10/4/11 – PDF

First Choice Bank, Geneva, IL FDIC-10-311b; Issued 10/18/11 – PDF

Sun Security Bank, Ellington, MO; (Assumed by Great Southern Bank, Reeds Spring, MO); FDIC-08-066b; Issued 10/17/11 – PDF

Sun Security Bank, Ellington, MO; (Assumed by Great Southern Bank, Reeds Spring, MO); FDIC-08-180; Issued 10/13/11 – PDF

Service1st Bank of Nevada, Las Vegas, NV; FDIC-10-512b; Issued 10/31/11 – PDF ISN Bank, Cherry Hill, NJ; FDIC-07-215b; Issued 10/28/11 – PDF

Bank of Smithtown, Smithtown, NY; FDIC-09-655b; Issued 10/28/11 – PDF

First International Bank, Plano, TX; FDIC-10-003b; Issued 10/17/11 – PDF

Regal Financial Bank, Seattle, WA; FDIC-09-558b; Issued 10/19/11 – PDF

Order Terminating A Supervisory Prompt Corrective Action

Ventura County Business Bank, Oxnard, CA; Cert. No. 57441; Merged Into and Now Known As: Royal Business Bank, Los Angeles, CA; Cert. No. 58816; FDIC-10-092PCAS Issued 10/24/11 – PDF

Ravenswood Bank, Chicago, IL; FDIC-10-286PCAS; Issued 10/5/11 – PDF

First International Bank, Plano, TX; FDIC-11-189PCAS; Issued 10/17/11 – PDF

NOTICE ISSUED
(Note: A Notice is a proposal enforcement action and is not a final decision or order by the FDIC)

Notice of Intention to Remove From Office and/or to Prohibit From Further Participation, Notice of Assessment of Civil Money Penalties, Findings of Fact and Conclusions of Law, Orders to Pay, and Notice of Hearing

United Commercial Bank, San Francisco, CA; FDIC-11-294e; FDIC-11-295k; Notice of Intention to Remove From Office and/or to Prohibit From Further Participation; Notice of Assessment of Civil Money Penalties, Findings of Fact and Conclusions of Law, Orders to Pay, and Notice of Hearing against Thomas Shiu-Kit Wu, Ebrahim Shabudin, Craig S. On, Thomas T. Yu, John M. Kerr, Paul Montelaro, Christian C. Lee, Lauren A. Tran, Yixing Sun, and Ta-Lun Wu; Issued 9/21/11 – PDF

ADMINISTRATIVE HEARING SCHEDULED FOR DECEMBER 2011

EuroBank, Coral Gables, FL; FDIC-10-585b; Section 8(b) Proceeding

Date: December 5, 2011
Location: Miami, Florida
FDIC Contacts: John B. Parker, Senior Regional Attorney
Barbara J. Lukes, Counsel

In a positive sign, the FDIC has decided that it will begin looking at ways to ease the burden of Dodd-Frank on community and small banks, reports Housing Wire.

Money quote:

Under a new acting director, the Federal Deposit Insurance Corp. will begin reviewing its risk management and supervision practices of smaller community banks to make them more efficient and possibly less burdensome.

Sandra Thompson, the director of risk management supervision at the FDIC, said the agency’s new Acting Director Martin Gruenberg is maintaining vigilance on the community banks that have survived the financial crisis in the current period of regulatory turmoil.