Newspaper article THE JOURNAL RECORD

FDIC Expected to Restrict Purchases by Assisted Banks / of Failed Institutions

Newspaper article THE JOURNAL RECORD

FDIC Expected to Restrict Purchases by Assisted Banks / of Failed Institutions

Article excerpt

DALLAS - A resolution setting a policy regarding purchases of failed banks by banks which have received capital injections from the government is expected to be adopted at the next board meeting of the Federal Deposit Insurance Corp.

Banks which have received FDIC money only, and no money from private investors, will be restricted in the bidding process compared to other unassisted banks, according to William Seidman, chairman of the FDIC.

Robert Harris, executive vice president of the Oklahoma Bankers Association, said it is his understanding the policy will be announced next week.

The issue arose when Bank of Oklahoma NA, which received $130 million from the FDIC last November, was allowed to successfully bid to acquire First National Bank of Yukon when that bank failed July 30. Then on Aug. 20, Bank of Oklahoma received approval a second time to purchase a failed bank when American Exchange Bank & Trust Co. of Norman was closed.

The Oklahoma Bankers Association requested a written policy from the FDIC clarifying its position and the Oklahoma Community Bankers Association also wrote the FDIC to voice its concern. In addition, the Community Bankers began reviewing what legal recourse is available to prevent assisted banks from successfully bidding for failed banks when other healthy banks also submitted bids.

Harris, who attended the American Bankers Association convention in Dallas this week, said of the approaches for deregulation or re-regulation that have been presented, the OBA has focused on what they expect Sen. William Proxmire, senate banking committee chairman, will introduce this session.

Proxmire has said he favors authorization of securities brokering by banks.

"We hope for the Proxmire bill with securities authorization and a grant to the state to make decisions in the real estate and insurance areas," Harris said.

Evidence shows bank customers would be able to save money in the areas of real estate, insurance and securities if the transactions were arranged by a bank, Harris said. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.