The Federal Deposit Insurance Corp. is considering expanding the use of loss-sharing asset sales to nonbank institutions to get better prices when closing a bank, according to a Bloomberg story using unnamed sources.
Behind the idea is the desire to increase the number of organizations that could potentially bid for assets from a closed bank. The FDIC cannot sell a closed bank to a nonbank.
Apparently sparking the conversations in part has been public criticism from Jonathan McKernan, a Republican who joined the FDIC's board of directors at the start of 2023. He has been vocal about shortcomings he perceives in the agency, including the need to get better prices in failed-bank auctions.
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