ABA Banking Journal - January 2011 - (Page 34)
feature story | D&O INSURANCE FDIC ups the ante The prospect of litigation is prompting change across the D&O insurance market, offsetting some positive signs he FDIC recently ignited what is likely to become a fire storm of litigation by authorizing lawsuits aimed at recovering $20 billion from former officials of failed banks. Almost all of the money the agency collects will come from D&O insurance, an inevitability with ramifications for banks, insurers, and directors. Among the most immediate impacts is the formation T By Melanie Scarborough, contributing editor of a two-tiered market. “For the healthy banks—those that are stable, have good numbers, and are clearly going to thrive—D&O coverage is readily available, even competitive,” says Chris Taylor, president, Financial Institutions, Zurich North America. “For a bank that has horrible financials—maybe has already been issued a Memorandum of Understanding—even keeping D&O insurance is hard.” Any bank with operations that raise 34 | ABA BANKING JOURNAL | January 2011
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