Asset-Backed Alert: FDIC Negotiating on U.S. Covered Bond Bill

"The FDIC is working with lawmakers to draft a new covered-bond bill," according to Asset-Backed Alert (July 2).

The story characterizes the FDIC as supporting development of a covered bond market if its concerns can be met.

This news comes barely a week after FDIC and Treasury opposition helped scuttle a conference committee initiative to make covered bond legislation part of Congress' financial regulatory reform bill.

Asset-Backed Alert paraphrased an FDIC spokesperson as saying "the two sides could reach an agreement quickly" provided that the agency's objections are satisfied.

Now that covered bond legislation can no longer ride the coattails of the must-pass financial reform bill, however, it is not clear how it will fare on a standalone basis.

The other big question: how major are the FDIC's demands for change?