To instruct the Inspector General of the Federal Deposit Insurance Corporation to study the impact of insured depository institution failures, and for other purposes.

(Sec. 1) Directs the Inspector General (IG) of the Federal Deposit Insurance Corporation (FDIC) to study the impact of the failure of insured depository institutions. Prescribes study details, including: (1) the impact of loss-sharing agreements (LSAs) upon the insured depository institutions that survive and the borrowers of those insured depository institutions that fail; (2) FDIC policies and procedures for monitoring LSAs, including those designed to ensure that institutions are not imprudently selling assets at a depressed value; (3) FDIC policies and procedures for terminating LSAs and mitigating the risk of acquiring institutions having substantial assets remaining in their portfolio when the LSAs are due to expire; (4) methods of ensuring the orderly end of expiring LSAs to prevent adverse impacts upon either borrowing, the real estate industry, or the Depositors Insurance Fund; (5) the significance of losses; and (6) the number of insured depository institutions placed into either receivership or conservatorship due to significant losses arising from loans for which all payments of principal, interest, and fees (payments) were current, under the contract. Requires the study to examine: (1) the impact of significant losses arising from loans for which all payments were current on the ability of insured depository institutions to raise additional capital; (2) the degree …

Congressional Research Service · 2012-01-03