BlackRock Inc. has requested the Federal Deposit Insurance Corp. (FDIC) to retract its proposed limitations on money managers' investments in banks, stating that the changes could have a significant impact on the financial landscape.

The asset management company, which oversees more than $7 trillion in exchange-traded and index funds, has expressed concerns that the rule could result in higher costs for banks when raising capital and create broader economic instability.

In a letter to the FDIC, BlackRock highlighted the potential for the proposal to cause regulatory and market uncertainty, which could discourage investments in bank securities. The firm emphasized that the plan carries "significant risks" that could negatively affect both investors and the banking sector.