FDIC looks to measure effect of accounting change on banks

08/20/2009 | Reuters

The Federal Deposit Insurance Corp. is expected to propose at its meeting Wednesday a rule that would seek input on whether banks need more time to build capital cushions against assets that were once held by off-balance-sheet trusts. The assets will still have to be shifted back on banks' books Jan. 1, but regulators want to learn more about how the change will affect banks and whether they should phase in risk-weighted capital that must be held against the assets. FDIC Chairwoman Sheila Bair acknowledged this month that the change will be difficult for some banks and could stall recovery of the securitization market, which helps lenders extend credit.

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