FDIC Gives BlackRock New Deadline to Resolve Banking Oversight Questions

BlackRock and FDIC Dispute - BlackRock missed the Jan 10 deadline set by the FDIC and requested an extension until March 31 to review a proposed pact that could impact its ability to serve clients [1] - The FDIC denied BlackRock's extension request and made additional demands related to the company's decision-making and documents about its bank holdings [1] - BlackRock argues that the FDIC's plans would harm index funds, which dominate many of its investors' portfolios, and increase the cost for banks to raise capital [2] - BlackRock wants the FDIC to coordinate its new oversight with the Federal Reserve, which already has a passivity agreement with BlackRock [2] Regulatory Concerns and Potential Actions - The FDIC could open an investigation into BlackRock and seek more information if the company does not make sufficient progress in resolving the issue by the new Feb 10 deadline [4][5] - Potential actions by the FDIC could include issuing a subpoena and taking other "more compulsory actions" against BlackRock [5] - Rohit Chopra, a member of the FDIC board, praised measures to ensure fund managers like BlackRock and Vanguard are not improperly influencing FDIC-supervised banks [3] - Chopra noted that large companies closely monitor the policy pronouncements of major asset owners, and if these firms are not truly "passive," they may violate longstanding banking statutes [3] BlackRock's Strategy - BlackRock pushed to delay talks until after the new administration takes office later in January [5]