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Bank and Thrift Regulation: Implementation of FDICIA's Prompt Regulatory Action Provisions

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Report Type Reports and Testimonies
Report Date Nov. 21, 1996
Report No. GGD-97-18
Subject
Summary:

The thrift and banking crisis of the 1980s caused losses in the deposit insurance funds estimated at more than $125 billion. The Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA), which was enacted to beef up federal oversight of depository institutions, created two new sections in the Federal Deposit Insurance Act--sections 38 and 39--that require regulators to establish a two-part regulatory framework to strengthen safeguards for the deposit insurance funds. The first part focuses on capital levels of depository institutions, and the second focuses on other measures of a financial institution's safety and soundness. This report discusses the progress and results of the federal regulators' implementation of FDICIA's provisions. Specifically, GAO assesses the (1) regulators' implementation of sections 38 and 39 and (2) impact of the two sections on federal oversight of the banking industry.

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