FDIC Board Issues Proposed Rule on Dodd-Frank Resolution Authority

The Board of Directors of the Federal Deposit Insurance Corporation (FDIC) voted on Friday, October 8, 2010, to approve through notational vote a proposed rule clarifying how the agency would treat certain creditor claims under the new orderly liquidation authority established under the Dodd-Frank Wall Street Reform and Consumer Protection Act. The NPR was the subject of a briefing and board discussion during the FDIC open board meeting on September 27th, 2010.

Title II of the Dodd-Frank Act provides a mechanism for the appointment of the FDIC as receiver for a financial company where the failure of the company and its liquidation under the Bankruptcy Code or other insolvency procedures would pose a significant risk to the financial stability of the United States.

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