William Cross

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So far William Cross has created 96 blog entries.
30 11, 2023


2023-11-30T14:26:00-05:00November 30th, 2023|5- Client Report|

Chopra Breezes Through Senate Banking as Senators Revisit Concerns Over AI, FRC Bidding Process

Today’s Senate Banking hearing with Director Chopra was even more cordial than yesterday’s HFSC session (see Client Report CONSUMER53) even though Republicans continued to criticize the Bureau’s recent rulemakings.  Today’s hearing also showcased renewed focus on JPM’s controversial acquisition of FRC, with Sen. Vance (R-OH) grilling Mr. Chopra about the bidding process.  Director Chopra emphasized that the least-cost test was adhered to and insisted that JPM’s bid was found to be higher than PNC’s, although he promised to provide the senator with more information.  Chairman Brown (D-OH) raised serious concerns over AI lending decisions and explainability, while Sen. Warner (D-VA) called it an issue “tailor-made” for FSOC.


29 11, 2023


2023-11-29T16:04:21-05:00November 29th, 2023|5- Client Report|

CFPB Catches a Break

In sharp contrast to most recent HFSC hearings with CFPB Director Chopra, today’s session was relatively calm.  Republicans did reiterate their strong aversion to the agency’s structure, funding, and recent initiatives, but Chair McHenry (R-NC) supported much in the Bureau’s open-banking proposal (see FSM Report DATA4) and GOP objections to other actions seemed more out of habit than with any intent to press for change.  The exception is the agency’s small-business reporting rule, where action is planned this week for a vote – likely successful – to reverse the agency’s approach.  However, President Biden has indicated he will veto it.  Refuting recent press reports, Mr. Chopra indicated no new plans to ban overdraft fees.


27 11, 2023


2023-11-27T16:53:58-05:00November 27th, 2023|2- Daily Briefing|

Global Regulators Unveil 2023 GSIB List Methodology

Following publication of the FSB’s updated 2023 GSIB list, the BCBS today published additional details of the assessment including denominators of the high-level indicators used to calculate bank scores, high-level indicators for each bank in the sample, cut-off scores, and thresholds used to allocate GSIBs to buckets for calculating higher loss-absorbency requirements.

Carstens Presses for Unified Ledger, CBDC

Pointing to the speed of AI adoption in sharp contrast to financial-system innovation, BIS General Manager Agustín Carstens has reiterated his call for central bank “unified ledgers.” These would serve as a “network of networks” digital infrastructure, with Mr. Carstens indicating that the result would enable instantaneous payment and settlement of any transaction, use of smart contracts and composability, and seamless integration and automation of digital asset payments.

SEC Finalizes Massive, Controversial ABS-Conflict Standards

Thirteen years after the Dodd-Frank Act demanded it (see FSM Report ABS17), the SEC today voted 4-1 to approve controversial conflict-of-interest standards for asset-backed securities (ABS). The final rule is significantly amended from the proposal, so much so that SEC Commissioner Peirce said that a new proposal was required prior to final adoption.



1 11, 2023


2023-11-01T17:55:34-04:00November 1st, 2023|1- Financial Services Management|

Large-Bank Climate-Risk Principles

The banking agencies have joined together to issue inter-agency climate-risk guidance based on proposed standards from the FDIC, OCC and FRB.  Most notably, the new standards expressly cover banking organizations over $100 billion, including FBO branches, but are indicative of the new approach to climate risk the agencies expect at any banking organization with elevated climate-risk exposure.


31 10, 2023


2023-10-31T09:26:49-04:00October 31st, 2023|1- Financial Services Management|

Debit-Card Interchange Fees

As suggested when the Fed last year finalized controversial new debit-card routing requirements, the central bank is now proposing a sharp reduction in the cap mandated on debit-card interchange fees under the Dodd-Frank Act’s Durbin Amendment for debit-card issuers with over $10 billion in assets.


26 10, 2023


2023-10-26T16:30:52-04:00October 26th, 2023|1- Financial Services Management|

Consumer Data Rights/Open Banking

Following a request for information that was a de facto advance notice of proposed rulemaking,[1] the CFPB has now proposed a preliminary, but binding framework for consumer data rights covering consumer “transaction” accounts offered by banks, credit unions, and – a departure from the initial outline – nonbanks/fintechs.  The proposal is sweeping with regard to data-rights and -sharing standards for covered accounts and providers, but still preliminary in that the Bureau has yet to turn as it plans to in in subsequent actions to loan products such as mortgages and student loans.


25 10, 2023


2023-10-25T16:58:50-04:00October 25th, 2023|2- Daily Briefing|

Divided Fed Advances Climate-Risk Principles

Following the FDIC’s 3-2 vote yesterday to approve final inter-agency climate-risk standards, the FRB late yesterday afternoon released its 5-2 decision to do the same.  Chair Powell emphasized as he has frequently before Congress that the guidance focuses only on climate financial risk and is thus fully consistent with the Board’s mandate, a reading of the principles also endorsed by Vice Chair Barr as he described its “narrow” construct.

CFPB Report Seeks to Validate Late-Fee Restrictions

Adding ammunition to the CFPB’s pending late-fee restrictions (see FSM Report CREDITCARD36), the Bureau’s biennial consumer credit card market report today finds that credit card companies in 2022  were significantly more profitable compared to pre-pandemic levels and charged consumers $130 billion in interest and fees.

Sharp Interchange-Fee Reduction Out for Comment

The FRB today voted 6-1 to approve a proposal mandating an approximate thirty percent reduction in debit-card interchange fees from the current cap (see FSM Report INTERCHANGE7).  As under current laws and required by the Dodd-Frank Durbin Amendment (see FSM Report CONSUMER14), the new approach would only apply to issuers with over $10 billion in assets.

Senate Banking GOP Raises New CCP Finance Concerns

As the Administration meets with Chinese financial authorities to hammer out ongoing concerns, all Senate Banking Republicans led by Ranking Member Scott (R-SC) today sent a letter to Treasury Secretary Yellen USTR Head Tai raising concerns that the CCP’s expansion into U.S. and global payments markets …

23 10, 2023


2023-10-23T11:37:12-04:00October 23rd, 2023|5- Client Report|

FedFin Assessment:  FRB Tries to Link Stability Conclusions to Regulatory Objectives

As promised, this in-depth report assesses Friday’s semiannual financial-stability report from the Federal Reserve.  As in its most recent reports, the Fed again eschews any clear conclusion about financial stability even as it observes that some risks are hard to quantify and thus may be overlooked.  Prior reports of “moderate” risk were shortly followed as in 2020 with considerable systemic challenge, leading the Fed thereafter and in this report to limit itself principally to quantification of emerging issues with few conclusions and, other than with regard to banks, no direct regulatory recommendations.   Where the Fed points to significant systemic challenges, it does so only by citing third-party survey results.


17 10, 2023


2023-10-17T16:33:46-04:00October 17th, 2023|2- Daily Briefing|

Bowman Opposes Global Unified Ledger, Cautious re Cross-Border CBDCs

FRB Gov. Bowman today sharply differed with BIS managing director Agustín Carstens on the future of central banks in wholesale payments.  Mr. Carstens as recently as three weeks ago pressed again for central bank “unified ledgers,” placing central banks wholly into payment streams not only for commercial banks, but also across most other payment, settlement, and clearing assets.

Basel Proposes Extensive Crypto Disclosure Templates

As anticipated, Basel released a consultative document today providing a standardized template for crypto exposure disclosures, with a proposed implementation date of January 31, 2025.  Basel proposes qualitative disclosures, including listing all crypto business activities, how they interact with the bank’s risk profile, the most significant current and emerging risks, and the bank’s approach to assessing classification conditions for group 1 cryptoassets.

Bipartisan Pressure Grows on White House for Iran, Other Sanctions

Led by Rep. Gottheimer (D-NJ), over one-hundred bipartisan lawmakers today sent a letter to President Biden calling for maximum enforcement of all U.S. Iran sanctions as well as immediate implementation of snapback sanctions on Iran at the UN Security Council.

Community-Bank Liquidity Shows Significant Stress

Providing worrisome data on small-bank resilience, a new community banking bulletin from the Federal Reserve Bank of Kansas City finds that community banks have decreased their holdings of highly-liquid assets over the past year to fund what it calls “outsized” loan growth despite deposit run-off.


17 10, 2023


2023-10-17T16:14:14-04:00October 17th, 2023|1- Financial Services Management|

Transaction-Account FDIC Coverage

Bipartisan senators have introduced legislation to provide FDIC coverage for certain noninterest-bearing transaction accounts, a move designed to prevent the stress and potential systemic risk evident when Silicon Valley and Signature Banks failed in March.  However, expanding FDIC coverage could increase FDIC premiums, heightening pressure on IDIs and their holding companies in concert with the pending special assessment unless companies that opt out of added coverage do not bear additional costs for IDIs that choose to offer these insured accounts.


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