WASHINGTON — Treasury officials and regulators are weighing a fresh round of bailouts for banks that were deemed too small or too risky to qualify for earlier aid.
Representatives from the Treasury Department, Federal Deposit Insurance Corp. and House Financial Services Committee discussed the plan by phone Thursday, said California Bankers Association Chairman Dan Doyle, who was on the call.
Small community banks are struggling as commercial real estate loans and others sour. Officials and industry representatives are considering how to get money to those banks, Doyle said Friday.
Other leaders in the banking industry confirmed that the conversations are taking place. Spokesmen for the Treasury and the FDIC did not respond to requests for comment.
The money could go to banks whose ratings by regulators made them too weak to qualify for earlier rounds of funding. It may be limited to banks with less than $5 billion on their books. The banks could be required to raise matching money in the private markets, Doyle and others said.
“They want to give another opportunity for some of the community banks,” he said.
The move could prevent some small bank failures, which would ease pressure on the FDIC’s dwindling fund that insures bank deposits.
