#Bank On

23 05, 2023


2023-05-23T17:15:40-04:00May 23rd, 2023|2- Daily Briefing|

House Advances Consensus Anti-China Reporting Legislation

The House yesterday voted 400-5 to approve H.R. 1156, bipartisan legislation addressing Congress’ China concerns by mandating a new study.

Gruenberg Endorses Bank On Accounts, Notes Continuing Racial Gaps

In remarks today largely devoid of policy implications, Chairman Gruenberg praised Bank On’s impact on financial inclusion, but noted that racial divides still persist as Black and Hispanic households are more likely to be unbanked than White ones at every income level.

IOSCO Aims at Ending Crypto-Market Arbitrage

Advancing global crypto standards, the International Organization of Securities Commissions today released a consultative report on the contentious question of centralized-market regulation with which a joint HFSC/AG Committee process is now wrestling (see Client Report CRYPTO43).

HFSC GOP Blasts GSE Fees, Supports FHLB System

Today’s HFSC hearing with FHFA Director Thompson was largely the LLPA battle we anticipated, with Republicans lambasting recent actions and Democrats tartly responding that Republicans did not know what they were talking about.

Hsu Echoes Gruenberg’s Bank-On Praises

Following Chairman Gruenberg’s remarks earlier today, Acting Comptroller Hsu similarly praised Bank On’s impact on financial inclusion while highlighting racial and income gaps.


7 02, 2023


2023-02-07T16:53:41-05:00February 7th, 2023|2- Daily Briefing|

CFPB Extends Digital Marketing Reach To “Pay-To-Play” Platforms

Expanding its reach to other forms of digital marketing (see FSM Report FINTECH30), the CFPB today issued an advisory opinion stipulating that what it calls “pay-to-play” consumer platforms presenting mortgage and settlement options are likely to violate the law.

High-Impact Fed Charter Policy Takes Effect

The Federal Register today includes the FRB’s policy statement rejecting the “states as laboratories for change” construct by conforming state member bank powers largely only to those authorized for national banks.  The statement is now effective.

GOP, Democrats Vie for Toughest Anti-China Stance

As we anticipated, at today’s full HFSC Committee hearing on China, Chairman McHenry (R-NC) made it clear that he intends action addressing emerging financial and economic risks, reiterating principles such as a commitment to free markets, opposing policies that stifle innovation, and preventing “malign” financial activities or interests.

Barr Backs Short-Term, Small Dollar Lending, Flexible Public-Welfare Option

In remarks today, Fed Vice Chair Barr stressed the need to eliminate discrimination in banking, noting the importance of the CRA rewrite (see FSM Report CRA32) to address redlining and community development.  However, he was silent as to the date by which the agencies are likely to issue the long-awaited final rule.


3 11, 2022


2022-11-03T17:15:32-04:00November 3rd, 2022|2- Daily Briefing|

Gruenberg Backs Bank On

In remarks late yesterday, FDIC Acting Chairman Gruenberg pointed to the importance of Bank On accounts to retain previously un- or under-banked households brought into the system following large government payments early in the pandemic.

ECB Presses Climate-Risk Capital Regs

Moving far ahead of the Fed, the ECB has announced strict plans to ensure that EU banks not only improve governance and express climate-risk stress testing, but also hold sufficient internal-capital allocations for physical and transition risk.

Data Standard-Setters to Come Under CFPB Regs

In remarks late yesterday updating the CFPB’s open-banking rulemaking efforts, Director Chopra indicated that the new consumer-data rules (see forthcoming in-depth FedFin report) will also address   how best to set public and private-sector standards to ensure industry-wide fairness and access to critical infrastructure.

IMF Climate-Risk Priorities Include GSIB Buffers

The IMF’s Deputy Managing Director Bo Li today set priorities for central banks and bank regulators addressing financial-system climate resilience.


17 05, 2022

FedFin on: CRA Regulatory Rewrite

2023-02-21T14:50:17-05:00May 17th, 2022|The Vault|

Following much talk about the need to update Community Reinvestment Act (CRA) rules since this was last done in 1995, federal banking agencies have finally agreed on a proposed redesign of standards essential to banks that wish to expand or acquire as well as those seeking strong community ties and the policy and political benefit these afford.  Much of the complexity in the NPR results from the agencies’ decision to allow only partial credit for activities (e.g., mortgages) largely assumed in the past…

The full report is available to retainer clients. To find out how you can sign up for the service, click here and here.…

17 05, 2022


2023-02-21T14:50:04-05:00May 17th, 2022|1- Financial Services Management|

CRA Regulatory Reform

Following much talk about the need to update Community Reinvestment Act (CRA) rules since this was last done in 1995, federal banking agencies have finally agreed on a proposed redesign of standards essential to banks that wish to expand or acquire as well as those seeking strong community ties and the policy and political benefit these afford.  Much of the complexity in the NPR results from the agencies’ decision to allow only partial credit for activities (e.g., mortgages) largely assumed in the past to benefit low-and-moderate income (LMI) households if they occurred in LMI census tracts as well as to condition product approval on the extent to which LMI-household needs are demonstrably met.  Offsetting these restrictions to some extent are broader criteria for eligible community-development and -service activities, but only wholesale and limited-purpose banks will enjoy the full benefit because new weightings require regulators to give the most weight to retail finance at most large banks.


4 05, 2022


2023-03-01T14:38:41-05:00May 4th, 2022|2- Daily Briefing|

Senate Overdraft-Fee Review Suggests Low Legislative Odds

Today’s Senate Banking Financial Institutions and Consumer Protection Subcommittee overdraft hearing was a largely collegial and theoretical session until Sen. Warren (D-MA) announced that she is sending letters to the largest banks with overdraft fees to demand that they terminate this practice.  Demanding also the OCC step in to bar fees, she pressed her legislation to ban them, legislation we continue to believe stands little chance of passage in this Congress.


30 03, 2022


2023-03-27T14:58:35-04:00March 30th, 2022|2- Daily Briefing|

Overdraft Hearing Sure to Raise Fee, Inclusion Concerns

Although the HFSC memo on tomorrow’s overdraft hearing tees up legislation for possible action, we expect the Consumer Protection Subcommittee hearing to be a rhetorical exercise pressuring banks which still charge what Democrats, as well as Acting Comptroller Hsu and CFPB director Chopra, view as punitive fees.

FDIC Joins Campaign for Climate-Risk Management Standards

The FDIC today issued a request for comment on climate-risk management similar in many respects to the OCC’s outstanding release (see FSM Report GREEN12).

Senators Urge Treasury, SEC to Close Private Investment Sanctions Gap

Sens. Warren (D-MA) and Whitehouse (D-RI) today asked in a letter to Treasury and the SEC to accelerate closing the AML/CFT gap posed by private investment firms.

CFPB Revs Up Democratic Overdraft Anger

Ahead of tomorrow’s overdraft hearing, the CFPB today put out a strong blog post saying that, while some banks have properly addressed consumer risk, many have yet to do so.

Senate Dems Demand More Small-Business Lending

Senate Banking Committee Chairman Brown (D-OH), Majority Whip Durbin (D-IL), and eight other Democrats today wrote to all the banking agencies demanding that they do something to ensure that banks lend more to small businesses.


15 03, 2022


2023-04-03T15:01:36-04:00March 15th, 2022|4- GSE Activity Report|

A Sort-Of CBDC and the Future of Federal Housing Finance

Although we have done extensive analysis of a U.S. central-bank digital currency (CBDC) in our sister analytical service, we have not viewed as it as an imminent strategic consideration for housing-finance agencies and financial institutions. However, a widely noted new paper on an alternative – Treasury accounts highlights a CBDC-like construct that could be implemented far more quickly than a Fed-based CBDC with significant residential-finance impact. As a result, we here assess this concept and its consequences.


29 12, 2021


2023-05-22T12:58:33-04:00December 29th, 2021|2- Daily Briefing|

FRB-St. Louis: Bank On Accounts Reach the Un-, Underbanked
A new report from the St. Louis Fed examining Bank On accounts finds that these low-cost products meet their goal by broadening financial access and inclusion (for more on these policy issues, see a FedFin EconomicEquality blog post here).


8 12, 2021


2023-05-23T13:00:59-04:00December 8th, 2021|2- Daily Briefing|

BIS Staff: DeFi Demands Tough Prudential, Governance Standards
As noted on Monday, the BIS has published several policy-making papers targeting different facets of nonbank financial intermediation that are sure to guide both U.S. and global action.

BIS CBDC Experiment Successfully Settles Wholesale FX Transactions
The BIS today ended its joint wholesale CBDC experiment with the French and Swiss central banks, concluding that CBDC can be effectively deployed for international settlements. This is a significant finding and one that surely puts still more pressure on the Fed to issue its discussion draft and then proceed to determine the U.S. role as other major central banks ramp up operations with major market and even reserve-currency impact.

OCC Defines a “Good-Overdraft” Construct
Acting Comptroller Hsu today advanced the anti-overdraft campaign launched last week by CFPB Director Chopra, arguing that overdrafts disadvantage lower-income households and thus erode the trust essential to an industry success.


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