FDIC pushing buyers of failed U.S. banks to aid borrowers

WASHINGTON, Sept 11 (Reuters) - The Federal Deposit Insurance Corp said on Friday it is encouraging the buyers of failed banks to provide mortgage relief to borrowers who are unemployed or underemployed.

The agency said it is making that recommendation to buyers who have received loss-share agreements from the FDIC when they have acquired the assets of failed banks.

"This is a win-win for the borrower, who can remain in his or her home while looking for a new job, and the acquiring institution, which continues to receive payments on the loan," FDIC Chairman Sheila Bair said in a statement.

The FDIC has been extending large loss-share agreements on pools of failed banks' assets to make the institutions more attractive to potential borrowers.

The agency said it is encouraging its loss-share partners to consider temporarily reducing mortgage payments for borrowers who are unemployed or underemployed.

The program will help prevent foreclosures through forbearance agreements that will give borrowers an opportunity to remain in their homes until they regain full employment, the FDIC said.

Bair also said it would also help the FDIC's finances.

"Ultimately, by reducing losses under our loss-share agreements, this approach helps reduce losses to the FDIC as well," she said.

So far this year 89 U.S. banks have failed, compared to 25 last year, and only 3 in 2007.

The failures have put pressure on the agency's insurance fund that safeguards bank deposits.

The insurance fund's balance dipped to $10.4 billion at the end of the second quarter, but that level does not include the additional $32 billion that the FDIC has set aside to cover the cost of bank failures over the next year. (Reporting by Karey Wutkowski; Editing by Phil Berlowitz)