Seidman Seeking More Authority in S&L; Bailout

Federal Deposit Insurance Corp. Chairman L. William Seidman, who would become the new deposit insurance czar under legislation moving through Congress, is talking to the Treasury Department about an idea that would enhance his power over the savings and loan bailout.

Seidman is angling for greater authority over a new entity that will be created to close or merge insolvent S&Ls; and dispose of real estate repossessed by the S&Ls;, an industry official said. The FDIC chairman is said to be proposing that the FDIC’s board, rather than a single person, be appointed chief executive of the Resolution Trust Corp.

Seidman declined to say his agency is advocating the idea, but he described it as “worth exploring” and “feasible.”

The Resolution Trust Corp., under a bill that passed the House last week and the Senate in April, will spend $50 billion in new bailout funds and handle $300 billion to $500 billion of bad loans and property.

The FDIC is getting the job of insuring savings and loan deposits, in addition to the commercial bank deposits it already guarantees. However, the FDIC’s relationship to the Resolution Trust Corp. is left unclear.