FDIC Sketches Rules for Bank Deals

Federal bank regulators made clear on Thursday what investors eying financial companies had long suspected: Bring money, experience and a skeleton-free closet.

The Federal Deposit Insurance Corp. on Thursday laid out a set of basic guidelines for private investors that are interested in acquiring dozens of banks that are struggling or have failed.

One of the most stringent safeguards is a proposal for the acquired bank to maintain a Tier 1 leverage ratio of 15% for at least three years after the deal is closed to ensure that the bank is "very well capitalized." FDIC Chairwoman Sheila Bair acknowledged that the proposal would be "contentious," but added that she is "open minded" to negotiations through a comment period which will last about a month. ...