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Friday, November 06, 2009

Sanders: Big Banks Must Be Broken Up In a Year

By Ronald D. Orol

MarketWatch Pulse

WASHINGTON - Large 'too-big-to-fail' banks should be required to break up into smaller banks within a year, according to legislation introduced by Sen. Bernie Sanders on Friday. "If an institution is too big to fail, it is too big to exist," Sanders said in a statement. The Vermont independnent Senator's legislation would require the Treasury Department to create a list of banks, hedge funds and insurance companies deemed too big to exist within ninety days of the passage of the legislation. Those institutions would need to be broken up within a year of the legislation becoming law. However, key lawmakers, including Rep. Barney Frank, D-Mass., said such an approach would be disruptive. Frank prefers to give regulators the authority to break up banks on a case-by-case basis.

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