[Congressional Record (Bound Edition), Volume 157 (2011), Part 13]
[Senate]
[Page 18090]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                  FDIC

  Mr. CHAMBLISS. Mr. President, I rise today to bring to the Senate an 
issue of critical importance.
  Last night, the Senate was able to pass by unanimous consent 
legislation that will provide much needed transparency to the Federal 
Deposit Insurance Corporation process of examining and resolving bank 
failures.
  Not only is this an issue that has severely impacted the wellbeing of 
my state of Georgia, but this Nation is suffering as a whole.
  There are some communities across the country that are no longer have 
a bank to serve them and will continue to suffer on their economic 
development efforts because the sole bank in their community has 
failed.
  Since 2008 there has been over 400 bank failures nationwide. Seventy 
of those failures have occurred in Georgia. This year alone 18 banks in 
Georgia have failed.
  While that represents over 27 percent of all the banks in my State, 
this is not just a Georgia issue.
  There are nine other States that have extraordinarily high rates of 
failures including: Florida, Illinois, California, Minnesota, 
Washington, Michigan, Nevada, Missouri, and Arizona.
  Unfortunately, there will continue to be bank failures in this 
country and this bill will provide the Congress with information about 
the underlying fundamentals that cause these failures.
  The bill directs the FDIC IG, in consultation with Treasury and 
Federal Reserve IGs to study FDIC policies and practices with regard to 
Loss Share Agreements; the fair application of regulatory capital 
standards; appraisals; FDIC procedures for loan modifications; and the 
FDIC's handling of Consent Orders and Cease and Desist Orders.
  Further, the GAO will be directed to a study those questions the FDIC 
IG is unable to fully explore such as the causes of the high number of 
bank failures; procyclical impact of fair value accounting; analysis of 
the impact of failures on the community; and, the overall effectiveness 
of loss share agreements for resolving banks.
  The swift passage of this legislation by the House of Representatives 
in July was a rare instance of bipartisan support and a sincere 
acknowledgement to the American people that bank failures on the whole 
need to be carefully considered by the Congress.
  The FDIC does a commendable job of ensuring that depositors at banks 
they regulate are going to be able to access their money in the event 
of a bank failure.
  I want the FDIC to know that their good work does not go unnoticed by 
this body, however it is clear that Congress needs more information 
about the underlying causes of these bank failures and it is imperative 
that the US Congress send a clear message that ``if there is a better 
way, then we must pursue it.''

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