FDIC warns banks of 'stroke-of-the-pen' risks

WASHINGTON, DC – The Federal Deposit Insurance Corporation (FDIC) has warned banks to pay attention to 'stroke-of-the-pen' risks caused by major Federal policy changes as a result of the current round of the World Trade Organisation (WTO) negotiations.

The agency says financial institutions should pay attention to regulatory risk, or the risk that a change in the rules governing an industry could impair an institution's financial performance. Banks with significant agricultural products should pay particular attention to the WTO process, the agency says.

Farm banks, usually having less than $100 million in assets, could be seriously affected by the WTO negotiations, which might lead to reductions in agricultural subsidies. Such banks make 25%