The chairman of the Federal Deposit Insurance Corp., Sheila Bair, said Tuesday that bank failures will continue at a "good clip" this year, and that she can't say yet whether her agency will ask the Treasury Department to help increase FDIC reserves. In an interview on CNBC, Bair said the FDIC's board now is considering its funding options and will make a decision by the end of this month. Asked if a funding request may be made of Treasury, she answered, "I don't know," but added, "I never say never."

However, Bair flatly rejected asking Congress for additional money. She said the FDIC's reserves stand at $42 billion, but at $10.4 billion after set-asides. Still, Bair said the FDIC's liquidity is "strong" as of the second quarter and that the agency has a variety of funding options open to it.

On other subjects, Bair called for a federal "resolution mechanism" to deal with failures at large financial institutions and that most private equity funds had communicated to her that they can live with the FDIC's guidance on requirements for buying banks.

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