Hedge Funds, Nonbanks Can Pose Systemic Risks, FDIC Chief Says

A top US bank regulator says more attention should be paid to the risks that hedge funds, mutual funds and nonbank lenders pose to the financial system.

Martin Gruenberg, the chairman of the Federal Deposit Insurance Corp., said Wednesday that Washington should collect more information on the firms. He flagged high levels of leverage and mortgage lending as areas that warrant a closer look.

“Since nonbanks do not have direct access to the public safety net, they are generally not subject to the same degree of regulation and supervision as banking organizations,” Gruenberg said in remarks to the ...