FDIC Chief: We May Borrow from Treasury

Federal Deposit Insurance Corp. Chairman Sheila Bair said Friday the agency is considering multiple options for stabilizing the Deposit Insurance Fund, including borrowing from the Treasury Department. To date, Ms. Bair has largely shied from using the agency's Treasury credit line as an option — preferring to boost reserves with industry premiums — although she has not ruled it out. In a speech Friday morning, she said the FDIC board will meet later this month, and likely will issue a proposal that asks for comment on numerous approaches to supporting the fund. The agency is considering "all options, including borrowing from Treasury. I never say, 'Never,'" she said at Georgetown University. The agency has faced industry and some congressional pressure to ease off on charging additional premiums. Instead, observers and some officials say the FDIC should utilize the credit line, which under recent legislation was raised to $100 billion. But borrowing from Treasury has typically been viewed as an extreme option.