Financial Industry Restructuring

The committee heard testimony from William Seidman, chairman of the Federal Deposit Insurance Corporation, on the financially strapped FDIC. The FDIC, which provides insurance… read more

The committee heard testimony from William Seidman, chairman of the Federal Deposit Insurance Corporation, on the financially strapped FDIC. The FDIC, which provides insurance against losses of bank depositors when savings institutions fail, has little money remaining in its coffers to cover future bank failures; the fund has been predicted to run out in the next one or two years. The Bush Administration gave a legislative proposal to Congress earlier in the week which gave the FDIC the authority to borrow $25 billion from the Federal Reserve to cover future bank losses, with an added measure allowing extra money to be borrowed by the FDIC. In his testimony, William Seidman said the added measure in the Bush Administration’s legislation would actually allow the FDIC to borrow up to $70 million from the Federal Reserve. Mr. Seidman predicted that the FDIC would have to borrow up to $35 billion “in a pessimistic scenario” over the next three year to remain financially solvent. He also said the necessity to use taxpayer funds to keep the FDIC afloat, a bailout scenario like the bailout of the U.S. savings and loans, was “highly unlikely.” The huge amount of credit authority surprised many observers, since it was a much larger amount than previously requested. It may signify that the FDIC’s financial problems are much larger than previously believed. close

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Financial Industry Restructuring

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Program ID:
17198-1
Category:
Senate Committee
Format:
Senate Committee
Location:
Washington, District of Columbia, United States
First Aired:
Mar 21, 1991 | 8:11pm EST | C-SPAN 1
Last Aired:
Mar 24, 1991 | 5:15am EST | C-SPAN 1

Airing Details

  • Mar 21, 1991 | 8:11pm EST | C-SPAN 1
  • Mar 22, 1991 | 12:20am EST | C-SPAN 2
  • Mar 22, 1991 | 5:00am EST | C-SPAN 2
  • Mar 24, 1991 | 1:45am EST | C-SPAN 2
  • Mar 24, 1991 | 5:15am EST | C-SPAN 1
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Financial Industry Restructuring

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