FDIC proposes tighter rules on private equity bank deals

Private equity firms would have to comply with tighter standards for capitalisation, hold periods and disclosure requirements if proposed rules from US banking regulator FDIC are approved.

Private equity firms seeking to invest in banks would have to meet high capitalisation requirements and longer required hold periods under proposed rules by the Federal Deposit Insurance Corporation released Friday.

“I am particularly concerned with new owners’ ability to support depository institutions with adequate capital, management expertise, and a long term commitment to provide banking services in a safe and sound manner,” FDIC chairman Sheila Bair said in a statement.

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