Key Endorsement for FDIC For Systemic Resolutions.(Washington)(Federal Deposit Insurance Corp.)

Byline: Stacy Kaper

WASHINGTON - The drive to give the government the power to unwind systemically important nonbanks gained more momentum Tuesday after Federal Reserve Board Chairman Ben Bernanke suggested offering such authority to the Federal Deposit Insurance Corp.

In response to questions from lawmakers at a House Financial Services Committee hearing, Bernanke said a proposed systemic risk regulator did not need to be the same agency that has resolution powers. "The FDIC or some other body could be in charge of resolution and deal with those specific issues."

House Financial Services Chairman Barney Frank is working with the Obama administration to pass a bill that would give the government resolution powers.

The Fed and the Treasury Department have each submitted legislative proposals to Frank's office to establish authority similar to what the FDIC currently has over failing banks and thrifts for systemically important firms and bank holding companies.

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