Senate Banking Committee members Mark Warner, D-Va., and Bob Corker, R-Tenn., introduced legislation Thursday that would give the Federal Deposit Insurance Corp. the authority it has been seeking to resolve bank holding companies.
The Resolution Reform Act would allow the FDIC to wind down a bank holding company if the insured depository institution within the holding company structure needed to be resolved. Under the bill, the bank holding company would be moved into receivership, the pieces would be sold off and the company would cease to exist.
The bill is likely to lay a marker in the committee's regulatory reform debate.
Sens. Warner and Corker introduced a related bill earlier this year that seeks to undo bailouts provided to major financial firms under the Troubled Asset Relief Program.
The Tarp Recipient Ownership Trust Act is designed to quickly relinquish the federal government's ownership stake in private companies such as American International Group Inc., General Motors Corp. and Citigroup Inc. in an orderly manner to protect and maximize the taxpayer's investment.
