Congressman Barney Frank
and Congressman Paul Gillmor React to the FDIC Letter on Wal-Mart’s
Application for Deposit Insurance
January 20, 2006
FOR IMMEDIATE RELEASE
CONTACT: Steve Adamske 202.225.7141
Congressman Barney Frank, the Ranking Democratic
Member of the House Financial Services Committee and Congressman Paul E.
Gillmor (R-OH), also a senior member of the House Financial Services
Committee, today made the following statements in response to a letter from
the FDIC regarding Wal-Mart’s application for deposit insurance. The FDIC
letter is in response to a December 16 letter by Frank, Gillmor and 23 other
bipartisan members of Congress asking the FDIC to hold public hearings on
the Wal-Mart application and to hold off action until the board has a full
complement of members.
“I welcome the FDIC’s approach to a major decision impacting federal banking
policy. To allow a large wholly commercial entity such as Wal-Mart to enter
the banking business raises serious issues, and the FDIC should not consider
this request without significant public input and consideration by the full
board,” said Congressman Frank.
“The announcement by the FDIC to delay a decision on Wal-Mart's application
until a full board has been convened and to allow for public hearings
demonstrates an awareness of the significance of Wal-Mart's request.
Maintaining the historic separation between banking and commerce is
essential to our financial safety nets and the FDIC's response to bipartisan
Congressional interest is consistent with their mission," Gillmor said. "I
look forward to continuing to work with Ranking Member Barney Frank and
others on the Financial Services Committee to get legislation to the
President that will address the policy concerns inherent in
commercially-owned ILCs," Gillmor continued.
The FDIC Letter is attached to this email. Below is the December 16
bipartisan letter:
December 16, 2005
Dear Chairman Gruenberg:
As concerned members of the House Committee on Financial Services, we urge
the Federal Deposit Insurance Corporation to defer any decision on the
application for federal deposit insurance filed by Wal-Mart Bank until the
Board has its full complement of directors. This application is clearly of
sufficient importance to require that it be made by the members of the FDIC
Board itself and only by a full Board without vacancies. We ask for your
commitment that the decision will be deferred at least until the Board is
once again at full strength.
On September 23, 2005, Ranking Member Frank and Congressman Gillmor wrote to
then-Chairman Powell urging the FDIC to hold public hearings on the
application, and we renew that request today. While FDIC regulations in 12
CFR 303.10(c), appear to leave the determination of whether to hold public
hearings to the discretion of the regional director, we urge that you
exercise your authority as Chairman to require that public hearings be held
on the Wal-Mart Bank application. As you know, this application has
generated historic levels of interest, with the FDIC receiving more than
1000 written comments. We believe that the extensive number of comments
received by the FDIC supports the need for public hearings, rather than be
used as a reason why public hearings should not be held. The FDIC regulation
states one of the grounds on which to hold public hearings is whether the
hearings “would be in the public interest.”
Given the reluctance of the FDIC to release additional information
concerning the non-public portion of Wal-Mart Bank’s business plan and given
the numerous requests for public hearings that the FDIC has received,
hearings would clearly be in the public’s interest.
Signed: Gary Ackerman, Michael Capuano, Julia Carson, William Lacy Clay,
Emanuel Cleaver, Geoff Davis, Barney Frank, Paul Gillmor, Katherine Harris,
Darlene Hooley, Paul Kanjorski, Sue Kelly, Steve LaTourette, Jim Leach,
Barbara Lee, Stephen Lynch, Carolyn McCarthy, Carolyn Maloney, Gary Miller,
Gwen Moore, Bernie Sanders, Chris Shays, Brad Sherman, Nydia Velazquez,
Debbie Wasserman-Schultz.
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