FDIC Proposes Interest Rate Caps to Support Banks’ Liquidity

Bloomberg reports:

The Federal Deposit Insurance Corp., which is selling failed U.S. banks at the fastest pace in 17 years, today proposed limits on interest rates paid by lenders with less than adequate capital to restore banks’ liquidity.

The FDIC recommended that insurance premiums be based on risks faced by banks that fail to meet regulatory requirements, a step to prevent banks from paying too much to boost revenue. Banks would be limited in tapping higher-cost sources of funds, such as brokered deposits, and be barred from paying rates that exceed their competitors’ by 75 basis points, the agency said.

The struggles of socialist banking.