FDIC's guidelines on private equity is almost completed

FDIC's guidelines on private equity is almost completed

As it became known Monday, Federal Deposit Insurance Corp's is to move quickly in finalizing guidelines on private equity investments in failed banks, supposedly easing one of its most controversial proposals. 

The guidelines is to be completed as soon as this month and could face a key measure that is being proposed for banks to be bought by private equity, the Tier 1 leverage ratio, reduced from a proposed 15% to around 10%. 

Uncertainty over the FDIC's rules set plans by investors to buy banks, and slowed some deals already in the works. That reflects that guidelines’ finalizing has some insistency.

The FDIC declines to discuss “during the comment period." According to the FDIC's website, the comment period ends August 10, and has already drawn sharp remarks from those in the industry.

Private Equity Council is still expected to issue its opinion as a representative of the large private equity companies. .

FDIC is targeting to reach a middle ground with private equity leaders because they represent a crucial source of capital as the US tries to resuscitate its struggling banking industry.

Another issue which could come into discussion is possibly concentrating on a measure known as the common equity ratio rather than the Tier 1 leverage ratio.