PRESS RELEASE
Federal Deposit Insurance Corporation
May 30, 2003 Media Contact:
David Barr (202) 898-6992
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-51-2003
FDIC CHAIRMAN POWELL ADDRESSES CONCERNS ABOUT
EXPANDED POWERS FOR INDUSTRIAL LOAN COMPANIES
FOR IMMEDIATE RELEASE
Federal Deposit Insurance Corp. Chairman Don Powell today addressed concerns that
legislation to expand the authority of Industrial Loan Companies (ILCs) would result in
unfair competition and unsafe practices. At issue is legislation that would allow ILCs,
which typically are limited-purpose lending institutions owned by commercial firms, to be
equal with banks when it comes to powers such as interstate branching and paying
interest on business checking accounts.
Chairman Powell, in a speech today, addressed the issue of safety and soundness as a
concern by stating, "Let me be very clear: The ILC banks are subject to the exact same
regulatory oversight and laws as the other 5,000-plus banks and thrifts for which the
FDIC is the primary supervisor" in areas such as capital standards, consumer
compliance, community reinvestment, and limits on transactions with affiliates and
insiders. "All this makes the point that these organizations are rigorously and sufficiently
supervised by the state supervisors and by the FDIC on an ongoing basis."
While the FDIC has not staked out a position on the spectrum of banking and
commerce, Chairman Powell did state that "we at the FDIC have not identified any
safety and soundness concerns unique to ILCs, and are certain that we have the tools
and the ability necessary to sufficiently supervise them." He indicated that this issue
would be looked at closely in the FDIC's Future of Banking study. Chairman Powell
concluded his remarks to the annual meeting of the Conference of State Bank
Supervisors by thanking the state supervisors.
Federal Deposit Insurance Corporation
May 30, 2003 Media Contact:
David Barr (202) 898-6992
Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's
banking system. It promotes the safety and soundness of these institutions by identifying, monitoring and addressing
risks to which they are exposed. The FDIC receives no federal tax dollars — insured financial institutions fund its
operations.
FDIC press releases and other information are available on the Internet at www.fdic.gov, by subscription electronically
(go to www.fdic.gov/about/subscriptions/index.html) and may also be obtained through the FDIC's Public Information
Center (877-275-3342 or 703-562-2200). PR-51-2003
FDIC CHAIRMAN POWELL ADDRESSES CONCERNS ABOUT
EXPANDED POWERS FOR INDUSTRIAL LOAN COMPANIES
FOR IMMEDIATE RELEASE
Federal Deposit Insurance Corp. Chairman Don Powell today addressed concerns that
legislation to expand the authority of Industrial Loan Companies (ILCs) would result in
unfair competition and unsafe practices. At issue is legislation that would allow ILCs,
which typically are limited-purpose lending institutions owned by commercial firms, to be
equal with banks when it comes to powers such as interstate branching and paying
interest on business checking accounts.
Chairman Powell, in a speech today, addressed the issue of safety and soundness as a
concern by stating, "Let me be very clear: The ILC banks are subject to the exact same
regulatory oversight and laws as the other 5,000-plus banks and thrifts for which the
FDIC is the primary supervisor" in areas such as capital standards, consumer
compliance, community reinvestment, and limits on transactions with affiliates and
insiders. "All this makes the point that these organizations are rigorously and sufficiently
supervised by the state supervisors and by the FDIC on an ongoing basis."
While the FDIC has not staked out a position on the spectrum of banking and
commerce, Chairman Powell did state that "we at the FDIC have not identified any
safety and soundness concerns unique to ILCs, and are certain that we have the tools
and the ability necessary to sufficiently supervise them." He indicated that this issue
would be looked at closely in the FDIC's Future of Banking study. Chairman Powell
concluded his remarks to the annual meeting of the Conference of State Bank
Supervisors by thanking the state supervisors.
Attachment: Donald E. Powell Chairman Federal Deposit Insurance Corporation The
ILC Debate: Regulatory and Supervisory Issues Remarks Before the Conference of
State Bank Supervisors May 30, 2003, Asheville, NC
ILC Debate: Regulatory and Supervisory Issues Remarks Before the Conference of
State Bank Supervisors May 30, 2003, Asheville, NC