Toward Deposit Insurance Reform

The subjects of this article are deposit insurance reform and the safety of the deposit insurance funds.There may be no more important issues facing Congress.For this reason, I introduced comprehensive deposit insurance reform legislation' on January 3, 1991, the first day of the 102d Congress.My proposal would limit insurance coverage; improve capital, accounting, and examination requirements; restrict risky activities of insured depository institutions; establish a consolidated supervisory and regulatory structure within a single agency; and protect consumers and customers of bank services.For many years I have been concerned about our deposit insurance system--one of the cornerstones of this nation's financial and economic stability.It was evident to me that the deposit insurance system was vulnerable to abuse, economic adversity, and regulatory failure.The failure of the Federal Savings and Loan Insurance Corporation (FSLIC) began the greatest financial scandal in the history of the nation.No one knows what the cost will be; only history will determine that * Chairman, Committee on Banking, Finance and Urban Affairs, United States House of Representatives.