I was a little surprised that the American Banker would publish a column ["
According to the column, the FDIC takes the position that it "resolved" Washington Mutual, which was a $299 billion bank, and is thus qualified to handle the resolution of, say, a Lehman Brothers. That's a bit of a stretch. WaMu was seized on Sept. 25, 2008, and sold to JPMorgan Chase on Sept. 26. No objective person would call that a resolution; it was simply a sale. The last time the FDIC had anything to do with a real resolution of a "large" bank, it was the failure of the Continental Illinois bank in 1984. That bank, at $40 billion, was considered too big to fail, which says a lot about the slipperiness of the TBTF idea.
Peter J. Wallison
American Enterprise Institute