WASHINGTON - Henry B. Gonzales, chairman of the House Banking Committee, says that bank regulators are wrongly delaying action on troubled financial institutions until after the election.
"It is unconscionable that politics gets in the way of good regulatory practices," the Texas Democrat said Friday, arguing that delay will increase the cost of resolutions.
"The taxpayer should not be made the fall guy for an administration desperate to get votes and contributions from corporations," he added.
Rep. Gonzales acknowledged that some banks will be closed after a new law, taking effect Dec. 19, requires federal regulators to seize institutions when capital dips below 2% of assets. But he said there is no reason for to wait that long.
"Regulators can close down sick institutions now - without regard to political considerations," the congressman said.
"I believe this only fair," he added. "Why should the cost of resolving a sick institution increase because of regulatory delay?"