From our “Reassuring News Dept”: the FDIC has issued a “Notice of Proposed Rulemaking” that would make it much easier for the FDIC to process bank failures.
Sure, what they’re trying to do is buried in some arcane procedural language. Fear not: I waded into this bureaucratic morass. I reckon if I can figure out how out raise a teenager I can take a stab at bank regulations.
They seek, in part, to require banks to:
Adopt a uniform data format for deposit account data that is available to the FDIC on extremely short notice.
Have IT set up a method to automatically put large deposit accounts on “hold” in any percentage specified by the FDIC.
The FDIC wants to have 24-hour turnaround on failed banks and needs the data processing capacity to make it happen, and happen f-a-s-t.
But these changes are not for all banks. Looks like the FDIC is only worried about the really big ones: the top 159 banks with over $2 billion in US deposits.
Hmmm… you don’t suppose some of those banks could be on my list of top 25 derivative gamblers…
Read the FDIC doc “Processing Deposit Accounts in a Bank Failure; Modernizing Large-bank Insurance Determinations Notice of Proposed Rulemaking” for yourself.
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