Leach says Congress will consider merging BIF and SAIF funds.House Banking Committee chairman Jim Leach
In currencies, this is the abbreviation for the Burundi Franc. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. ) with the Savings Association Insurance Fund Savings Association Insurance Fund (SAIF) A government organization that replaced the Federal Savings and Loan Insurance Corporation as the provider of deposit insurance for thrift institutions. (SAIF). "It is likely Congress will deal with the BIF-SAIF issue, although it had not seemed probable earlier this year," said Leach. Leach said the recapitalization Recapitalization Restructuring a company's debt and equity mixture often with the aim of making a company's capital structure more stable. Notes: Companies often want to diversify their debt-to-equity ratio to improve liquidity. last May of the BIF, the growth of the deposited balance of the SAIF and the thrift industry's willingness to accept a sacrifice to restore the SAIF have put the BIF-SAIF issue on the forefront of the legislative agenda. Leach said the sacrifice would be in the form of a higher premium assessment to recapitalize re·cap·i·tal·ize tr.v. re·cap·i·tal·ized, re·cap·i·tal·iz·ing, re·cap·i·tal·iz·es To change the capital structure of (a corporation). re·cap the SAIF before a merger with the BIF The chairman said the thrift industry accepted a one-time assessment of $0.85 per $100 of insured deposits. "The public is not in the mood to accept any more obligations for the savings and loan savings and loan n. a banking and lending institution, chartered either by a state or the Federal government. Savings and loans only make loans secured by real property from deposits, upon which they pay interest slightly higher than that paid by most banks. disaster," said Leach. "But with this phased-in premium in the S&L industry, I think there will be a BIF-SAIF resolution." Reforming Glass-Steagall The chairman also said there was a possibility that the House would pass legislation this year to reform the Glass-steagall Act The Glass-Steagall Act, also known as the Banking Act of 1933 (48 Stat. 162), was passed by Congress in 1933 and prohibits commercial banks from engaging in the investment business. . Enacted during the Great Depression to restrict the securities activities and affiliations of banks, Glass-Steagall has long been seen as having separated commercial banking from investment banking, an arrangement Leach said was "irrational" to continue. "Larger businesses have had to find the instruments of choice outside of commercial banking," said Leach. If larger banks were to maintain a relationship with their customers, they needed to offer investment banking instruments, he said. "Re-integrating commercial and investment banking will give the customer more choices." He also said smaller businesses would benefit as well, because smaller banks would be given the opportunity to offer investment banking services. Leach said legislation to consolidate regulation of the banking and securities industries would head the committee's agenda in 1996. The committee also will consider legislation to strengthen oversight of the over-the-counter derivatives markets. 
Amber F. Ladeira (Member): 9/19/2009 5:27 PM
Bring back Glass-Steagall! Gramm, Bliley & Leach, all of you ignored history (which is always relevant; human nature has not changed in 6,000 years); the Great Recession 0f 2008-2009 is the result. Banks should not have commercial, residential,<br>individual and investment functions all under "one roof". Separating these protected the U.S. for decades, from Roosevelt's<br>era until Mr. Clinton's, so there apparently WERE no financial whizzes in Congress just before the advent of Bush.<br><br>Bring back Glass-Steagall!<br><br>Amber Ladeira<br>amberladeira.blogspot.com |
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