ABA Statement on FDIC Chair Gruenberg’s Remarks at Brookings

“We're disappointed but not surprised by the regulatory proposals outlined today by FDIC Chairman Gruenberg. His latest ideas echo the misguided capital changes unveiled just last month and will only make it harder for already safe and sound banks to serve their customers and communities. In particular, his call for expanding resolution planning rules for banks with as little as $50 billion in assets and expanding long-term debt requirements for banks with assets of $100 billion or more will simply make it more difficult for those already highly regulated and well-capitalized banks to support the economy. The one-size-fits-all approach also further undermines the bipartisan legislation passed by Congress in 2018 that prudently requires regulators to tailor rules based on a bank's risk and business model.

“Just as concerning was the Chairman's call for altering the supervisory treatment of uninsured deposits and labeling them as unstable for purposes of deposit insurance pricing. As the FDIC considers possible changes, it must recognize that uninsured deposits are not uniform and not an accurate proxy for liquidity risk or the effectiveness of liquidity risk management.

"The FDIC and other regulators must demonstrate that all of these proposed changes, like the recent capital rules, are justified by evidence and outweigh the significant costs to our economy.”