FDIC seeks to increase hiring to deal with anticipated bank failures

March 26, 2008

Federal regulators, anticipating a surge in troubled financial institutions, will boost by more than 60 percent the number of workers who handle bank failures.

The Federal Deposit Insurance Corp. wants to add 140 workers to bring staff levels to 360 workers in the division that handles bank failures, John Bovenzi, the agency's chief operating officer, said Tuesday.

"We want to make sure that we're prepared," Bovenzi said, adding that most of the hires will be temporary and based in Dallas.

There have been five bank failures since February 2007, following an uneventful stretch of more than two years. The last time the agency was hit hard with failures was during the 1990-91 recession, when 502 banks failed in three years.

Analysts see casualties rising but don't believe they will reach that level. Gerard Cassidy, managing director of bank equity research at RBC Capital Markets, projects 150 bank failures over the next three years.

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