Sheila Bair, chairwoman of the Federal Deposit Insurance Corp., warned that a provision in the latest version of legislation overhauling financial regulation could result in "backdoor" rescues. Bair's comment prompted Sen. Christopher Dodd, D-Conn., chairman of the Senate's banking committee, to agree to change the provision. A spokeswoman for Dodd said he will change a part of the bill that would give the Federal Reserve authority to use emergency power to extend loans to a "financial market utility," which would include only companies deemed "systemically important."

Related Summaries