08/17/2023

FDIC Prepares New Regulations for Big Banks

The action follows other agencies' plans to revise capital requirements for large banks

On August 14, 2023, Federal Deposit Insurance Corporation (FDIC) Chair Martin Gruenberg announced that his agency is planning new regulations for banks with more $100 billion, including a proposal for how to ensure an orderly dissolution and sale of a large bank in case of failure.

Gruenberg also hinted at potential adjustments to rules concerning long-term debt, bank supervision and deposit insurance pricing to prevent the failure of a single bank from triggering a systemic crisis. 

This push for stricter new regulations follows recent efforts by other regulators, like Federal Reserve Vice Chair for Supervision Michael Barr, to revise capital requirements for large banks. Gruenberg described the new rules as necessary to enhance the stability and resilience of the U.S. banking sector. 

While there is potential for resistance from the banking industry and its congressional allies, Gruenberg underscored that the FDIC’s proposed measures are crucial to mitigating risks and ensuring the financial system’s resilience. 

This article was provided to OSAP by ASAE's Power of Associations and Inroads.