FHFA Sets Comment Deadline for Freddie Closed-End Loan Product
The Federal Register includes the FHFA’s comment request on a new Freddie Mac product that would
give borrowers access to their locked-up equity without a new first lien at a higher rate or a traditional homeequity second riding piggyback atop the first lien.
GAO Gives CFPB Clear Bill of Financial Health
The GAO today released the report initially scheduled for the Financial Institutions Subcommittee hearing earlier this week convened to discuss CFPB financial management.
Deadline Set for Comment on Controversial FDIC Merger Proposal
The Federal Register today sets the comment deadline on the FDIC’s request for comment on its bank merger policy (see FSM Report MERGER15).
House Bill Revises Exam Appeal Process
HFSC Vice Chair Hill (R-AR) and Rep. Scott (D-GA) yesterday introduced H.R. 8071, a bill to create an FFIEC independent review officer for banks seeking review of supervisory judgements and require supervisors to respond more quickly to bank queries.
FDIC’s Paperwork Request Illuminates Proposed Merger Policy
In conjunction with today’s publication of the FDIC’s proposed merger-policy rewrite (see FSM Report MERGER15) comes a proposed change in the filings that would need to accompany any merger application submitted to the FDIC.
G7 Backs NBFI Reform
Although prioritizing Ukraine and broad statements about the global economy, the new statement from G7 finance ministers and central bankers also emphasizes the need to pursue the kind of NBFI reforms advanced yesterday by the FSB.
Bowman Battles New Liquidity Regs
FRB Gov. Bowman today reiterated her conviction that sufficient contingency funding should be a matter between banks and supervisors, not a cause for new rules.
Brown, Reed Press Big Banks on Wire Transfer Fraud
Building on their longstanding campaign pressing banks on Zelle, Senate Banking Chair Brown (D-OH) and Sen. Reed (D-RI) today sent letters to the CEOs of JP Morgan, Wells Fargo, Bank of America, and Citi stating that banks have a responsibility to proactively monitor and prevent fraudulent wire transactions and should reimburse customers when these obligations are not met.
House Select Committee Targets Index-Fund Chinese Investments
Building on its prior report pressing financial institutions to address exposures to China and potential systemic risks, the House Select Committee on the CCP today released a bipartisan report sharply criticizing index-fund and asset managers for investing American savings in sanctioned Chinese companies associated with the PLA and/or human-rights abuses.
Global Regulators Tackle NBFI Margining, Collateral Transformation
As it has long promised, the FSB today issued a consultation on standards designed to buttress derivatives, commodity, and securities-financing markets under stress through more stringent margining and collateral requirements.
Basel Head Says Go Slow re AI Risk, Supervisory Models
Basel’s Secretary General, Pablo Hernández de Cos, today focused on AI’s risk-reward profile in the banking sector, concluding that it raises a series of profound questions global regulators must work cooperatively to address.
Lummis, Gillibrand Begin Senate Stablecoin Debate
As long anticipated, Sens. Lummis (R-WY) and Gillibrand (D-NY) today introduced a significantly revised version of their 2022 Bill (see FSM Report CRYPTO28) laying out U.S. stablecoin standards.
FIO Subpoena Power Faces Rollback
At HFSC’s mark-up today, the committee began with Rep. Fitzgerald’s (R-WI) Insurance Data Protection Act, H.R. 5335, which would repeal the Federal Insurance Office’s authority to subpoena insurance companies for data collection.
HFSC Likely to Pass RegTech Bill
At HFSC’s extended mark-up today, the committee turned to H.R. 7437, a bipartisan bill that would require federal banking regulators to regularly review and report to Congress on their use of technology to ensure they’re equipped to address threats to the financial system.
HFSC Set to Pass AOCI Recognition, Systemic-Risk Designation Study Measures
Continuing our coverage of today’s mark-up, HFSC was generally supportive of the two bills on the agenda from Democrats, H.R. 4206 from Rep. Sherman (D-CA) requiring large banks with available for sale securities to mark to market …
House GOP Takes on New Merger Guidelines
The House Small Business Committee today sent a GOP letter to the FTC and Justice Department strongly protesting new merger guidelines (see FSM Report MERGER13) on grounds that they sharply curtail needed small-business capital.
House Hikes Iran Sanctions
Working through a series of sanctions bills in the wake of recent geopolitical developments, the House yesterday voted 294-105 to advance H.R. 5921, a bill introduced by Rep. Huizenga (R-MI) that prohibits Treasury from authorizing transactions by U.S. financial institutions in connection with Iranian imports or exports other than food, medicine, and other humanitarian assistance.
House Passes Bill Targeting China-Iran Petroleum Trade
Continuing its response to recent geopolitical events, the House yesterday voted by a 383-11 margin to pass H.R. 5923, a bill from Reps. Lawler (R-NY) and Gottheimer (D-NJ) that would require the President to periodically determine if any Chinese financial institutions have purchased petroleum or petroleum products from Iran, stating that U.S. financial institutions also may not open or maintain certain accounts with Chinese institutions that have done so.
Warren Again Targets OCC Merger Decisions
Continuing recent attacks on the OCC’s approach to mergers, Sens. Warren (D-MA) and Blumenthal (D-CT) yesterday sent a letter to Acting Comptroller Hsu sharply criticizing the agency’s decision first to allow NYCB to acquire Flagstar bank and then do the same shortly thereafter for Signature.
OCC Toughens LCR, NSFR via New Reporting Requirements
The OCC today sought public comment as required by law for …
Warren, Whitehouse Attack Chamber’s CFPB Litigation
Continuing their support of the CFPB’s credit-card rule (see FSM Report CREDITCARD37), Sens. Warren (D-MA) and Whitehouse (D-RI) took on the Chamber of Commerce, writing to protest its “outrageous and unwarranted” legal challenge.
HFSC Set for Marathon, Partisan Mark-Up
Wednesday’s HFSC mark-up will feature predictable partisan battles over an array of GOP resolutions to repeal the CFPB’s credit-card rule (see FSM Report CREDITCARD37) and all of the banking-agency climate-risk standards (see Client Reports in the CLIMATE series).
Fed Paper: CBDC May Increase Run Risk, Digital Asset Stability
A new Fed staff paper analyzes a CBDC’s potential impact on financial stability, finding that CBDC introduction could cause a small increase in run risk, but could also improve financial stability in the digital-asset space and enhance cross-border payments.
Does Supervision Make Banks Safer? FRB-NY: Probably
Noting that the impact of bank supervision has received far less attention than that of regulation, the Federal Reserve Bank of New York’s blog today includes a post summarizing literature in this area, one that has of course taken on new importance in the wake of last year’s failures and resulting agency self-assessment.
BIS Presses Tokenized Unified Ledger
Building on prior work advocating for unified ledgers to achieve digital efficiencies without added risk, the BIS’s General Manager Agustín Carstens and Infosys Chairman Nandan Nilekani today extended prior analyses to tokenization.
Barr, Tillis Warn CFPB Against Mandatory-Arbitration Ban
HFSC Financial Institutions Chair Barr (R-KY) and Sen. Tillis (R-NC) sent a letter to the CFPB today threatening to invoke the Congressional Review Act to overturn any newly-proposed mandatory-arbitration ban from the CFPB, warning that it would violate the CRA. This is based on the enactment of a reversal of the agency’s prior ban in 2017 which the Members state now cannot be vitiated by any proposal close to the one revoked.
IOSCO Adds CD, AI Workstreams to Revised Work Plan
IOSCO today announced revisions to its 2024 work plan, adding new workstreams to address opacity and illiquidity in the single-name CDS market as well as the integrity, financial stability and investor protection associated with AI along with monitoring financial-asset tokenization.
Bipartisan Bill Seeks Barriers to Financial-Infrastructure Ransom Payments
Ahead of next week’s HFSC hearing, Chair McHenry (R-NC) and Rep. Pettersen (D-CO) introduced the Ransomware and Financial Stability Act, a bill to require FMUs, large securities exchanges, and certain technology-service providers to notify Treasury before paying a ransom and come under numerous restrictions should they do so.
Waters Plans FHLB-Reform Legislation
Sharply criticizing FHLB backstops for troubled banks, HFSC Ranking Member Waters (D-CA) stated that she is drafting legislation to implement a number of the Congressional recommendations outlined in FHFA’s recent FHLB-reform report, including readying a bill to double the FHLB system’s required contributions to affordable housing and prevent the banks from making good as banks go bad.
OCC Merger Deadline Extended, De Facto Policy Remains
Responding to industry requests, the OCC today extended the comment deadline on its merger proposal (see FSM Report MERGER14) until June 15 from April 15.
Gruenberg Defends FDIC GSIB-Resolution Readiness
Rejecting criticism from its own inspector-general and others including Karen Petrou, FDIC Chair Gruenberg today stated that the agency is indeed ready to resolve a U.S. GSIB and that any such resolution will exert market discipline on shareholders and BHC counterparties.
Hsu Presses Banks to Expand Account Access for Immigrants
Focusing on increasing banking access for immigrants, Acting Comptroller Hsu today told banks to consider risk-based adjustments to their account screening processes to accept more forms of identification for account openings such as municipal IDs and consular ID cards.
Senate GOP Tackles Card Fees
Joined by GOP Senators from credit-card domiciles, Senate Banking Ranking Member Scott (R-SC) yesterday led the expected Republican resolution overturning the CFPB’s credit-card late fee rule (see FSM Report CREDITCARD37). It joins like-kind resolutions from Rep. Barr (R-KY) and Ogles (R-TN), with Mr. Barr’s resolution the one likely to move to the House floor.
Warren Starts Bargaining for Crypto-AML Standards
Throwing another wrinkle into the careworn face of efforts to pass stablecoin legislation, Sen. Warren (D-MA) yesterday sent a letter to Reps. McHenry (R-NC) and Waters (D-CA) arguing that their ongoing and apparently-hopeful efforts to craft stablecoin legislation may inadvertently amplify risk.