Senate Panel Endorses Taylor to Head FDIC
WASHINGTON -- William Taylor received a resounding vote of confidence Friday from the Senate Banking Committee, assuring his confirmation as chairman of the Federal Deposit Insurance Corp.
The panel voted 21-0 in support of Mr. Taylor, who is director of the Federal Reserve Board's division of banking supervision and regulation. The full Senate could vote on his confirmation as early as Tuesday, when it convenes again.
Meanwhile, Senate Banking Committee Chairman Donald W. Riegle indicated that he is not likely to ask for a vote anytime soon on Comptroller of the Currency Robert L. Clarke's nomination for a second term.
Doubts About Merger
Questions about Mr. Clarke's handling of the merger that created First RepublicBank in Texas "raise serious doubts, and they need to be answered," Mr. Riegle said after a committee session.
Mr. Clarke, he said, permitted the merger to go forward despite concerns from his examination staff about the way assets were valued by the merging institutions. The First RepublicBank failure in 1988, he added, is likely to cost the government $3 billion.
Fed Off the Hook
Mr. Riegle said Mr. Taylor, whose agency -- the Fed -- also had a say in the merger, should not be held equally accountable because the Comptroller's office did not provide adequate information.
Mr. Riegle said he discussed the matter privately with Mr. Taylor after the Fed official's confirmation hearing. It did not come up during the public session, he said, because information about the First RepublicBank collapse is only now being developed.
Mr. Taylor, who would succeed L. William Seidman, is a seasoned bank regulator and is highly regarded in industry and government circles. If he takes office this week, his first major decision may be whether to raise the bank deposit insurance premium from the current 23 cents per $100 of insured deposits.
Mr. Riegle last week urged the FDIC board to consider higher a premium after he recieved a letter from former Chairman Seidman, warning that the proposed $70 billion recapitalization could prove inadequate. The FDIC would have to act by Nov. 1 to have a higher premium in place Jan. 1.