FDIC’s Hill Warns of ‘Overreaction’ to Spring Bank Failures

A top official at the Federal Deposit Insurance Corp. said his agency and other federal regulators are trying to do too much to shore up the banking system following a string of failures this year.

FDIC Vice Chairman Travis Hill said a slate of new capital and resolution proposals, a review of bank merger policy, and a host of other rules in development threaten to hike costs for banks and their customers.

“While I think that some response to the bank failures is warranted, I fear that an overreaction is underway,” Hill, a Republican who served as a policy deputy ...