ILC Charters
Senate Banking Committee Chairman Brown (D-OH) is now leading a renewed bipartisan charge to limit the ability of nonbanks to use industrial loan companies (ILCs) to gain access to bank privileges without the parent-company supervision required of all other domestic IDI parents. However, supervision of such parent companies and their nonbank subsidiaries would come from the FDIC, not FRB. This would reduce what some believe to be the Fed’s outsized role as bank and BHC supervisor, but the FDIC’s ability to undertake new supervisory duties is unclear, especially in the wake of recent failures.