FDIC Extends Moratorium on Commercial ILC Applications by 1 Year

By Matt Squire and Melissa Gorelick

Jan. 31 – The U.S. Federal Deposit Insurance Corp. board today voted unanimously to extend a moratorium on industrial loan company (ILC) applications from commercial firms by one year, two days after lawmakers introduced a bill to limit ownership of such entities. The one-year freeze would allow the House of Representatives to consider legislation introduced Monday by Reps. Barney Frank, D-Mass., and Paul Gillmor, R-Ohio, that would effectively prohibit large retailers--such as Wal-Mart and Home Depot--and other companies from establishing ILCs, which are state-chartered, FDIC-insured financial firms. The FDIC also approved a notice of proposed rulemaking to strengthen application requirements...