Dodd Weighs Changes to Overhaul of Financial Rules

By Phil Mattingly and Alison Vekshin

March 20 (Bloomberg) — Senate Banking Committee Chairman Christopher Dodd will begin weighing amendments to his proposed overhaul of financial rules next week after accepting a change sought by Federal Deposit Insurance Corp. Chairman Sheila Bair.

Dodd plans to begin committee meetings March 22 that will consider some of the 399 amendments senators have offered to the plan he unveiled this week, his spokeswoman Kirstin Brost said yesterday. The Connecticut Democrat has already agreed to revise language that Bair said could lead to “backdoor bailouts” of firms through a Federal Reserve lending facility, Brost said.

“There are provisions that would suggest that the Federal Reserve Board could support an open institution if it’s involved in payment processing or clearing facilities,” Bair said in a speech yesterday at the Independent Community Bankers of America convention in Orlando, Florida.

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Banks Out of the Woods? Maybe Not

Published: February 26, 2010

MORE than $1 in every $10 that American banks have outstanding in loans is lent to a troubled borrower, a ratio far higher than previously seen in the quarter-century that such numbers have been compiled.

Bad Bank Loans Soar

The problems are greatest in construction loans for single-family homes, where nearly 40 percent of the loans either are delinquent or have been written off as uncollectible. But they are also high in mortgage loans for single-family homes, where $1 in every $8 of loans is troubled.

The figures were released this week by the Federal Deposit Insurance Corporation, as it announced that the number of banks in trouble had risen sharply, and forecast that the rate of bank failures would increase.

Full Article at NYTs