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Regulate Swaps Like Insurance, Former FDIC Head Tells NAIC

At the National Association of Insurance Commissioners’ (NAIC) fall meeting, former Federal Deposit Insurance Corp. (FDIC) Chairman Sheila Bair told state insurance regulators that credit-default swaps still pose a systemic risk to the U.S. financial system and should be subject to regulations similar to those that govern the insurance industry
November 9, 2011

At the National Association of Insurance Commissioners’ (NAIC) fall meeting, former Federal Deposit Insurance Corp. (FDIC) Chairman Sheila Bair told state insurance regulators that credit-default swaps still pose a systemic risk to the U.S. financial system and should be subject to regulations similar to those that govern the insurance industry.  Bair also urged regulators to exercise caution when deciding whether to ease the 100 percent collateralization requirement for reinsurers based outside the United States.

Read more on the regulation of credit-default swaps: CDS Pose Systemic Risk, Should Be Regulated As Insurance (BestWire 11/4/11)