Senate negotiators working on the financial-regulatory bill today rejected a proposal from House Republicans that would make big banks liable for the costs of winding down Fannie Mae and Freddie Mac.The proposal would have made the government-controlled home loan companies, which own or guarantee more than half of the $11 trillion U.S. mortgage market, part of a Wall Street-financed “rainy day” fund that would be used to pay for the liquidation of large failed companies.
Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat who has led the Senate side of final negotiations on the bill, called the Fannie-Freddie proposal a “stall tactic.”In a letter to lawmakers today, American Bankers Association Chief Executive Officer Edward Yingling said the provision “could impose a tremendous additional liability on the banking industry of hundreds of billions of dollars.”>>>MORE
Thursday, June 24, 2010
"Senators Reject Proposal For Banks to Bail Out Fannie, Freddie" (FNM; FRE; C; BAC; JPM)
Bloomberg has the scoopage: