After being pushed to do so by pending Senate Appropriations language, the federal banking agencies last week issued a report required in last year’s CR on the extent to which new capital rules damage the ability of banks – especially smaller ones – to engage in mortgage finance. In short, they do, but the agencies don’t care. If Congress wants to change these capital rules, it will have to force the regulators to do so by law – legislative action that would need to be snuck into this year’s CR if it is to stand a small chance of enactment in 2016.
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