Mar 08, 2010

"Financial institutions that have more than $100 billion in assets would continue to be overseen by the Federal Reserve, based on a legislative proposal under consideration in the Senate, according to people familiar with negotiations on broad bank-reform legislation.

The move would be a major switch for Senate Banking Committee Chairman Christopher Dodd -- and a potential victory for the Fed.

Last November, Dodd introduced a draft legislative proposal that would have stripped the Fed of its authority to supervise banks, so that it could focus more carefully on monetary policy and interest rates.

As part of this latest proposal, hundreds of smaller banks that are currently overseen by both state regulators and the Fed would have their federal oversight handled by the Federal Deposit Insurance Corp. instead."

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