#BNPL – Federal Financial Analytics

14 12, 2022

CONSUMER45

Max Camateros-Mann2022-12-15T17:14:06-05:00December 14th, 2022|5- Client Report|

HFSC GOP Sets Table for Rocky CFPB Relationship

Despite early warm goodbyes to outgoing Chairwoman Waters (D-CA), GOP members wasted no time trading blows at a fiery HFSC session today with CFPB Director Chopra. As anticipated, incoming Chair McHenry (R-NC) and committee Republicans focused their efforts on what they call “regulation by guidance,” accusing the Director of trying to influence the behavior of firms through nonbinding releases and avoiding the public rulemaking process. In his testimony and answers to members, Director Chopra said that the Bureau is watching voluntary industry action on Zelle fraud before taking action and is more broadly focused on payment-system standards that ensure neutrality and strict data-privacy. Republican members also highlighted how the Bureau’s proposed small-business reports (see FSM Report SMBUS27) put undue regulatory burden on small banks. Additionally, Rep. Loudermilk (R-GA) inquired about the appropriateness of making banks liable for P2P fraud. Democrats refrained from questioning the Bureau’s actions, instead asking about its bigtech inquiry, the resurgence of ARMs, and blackbox algorithms. Reps. Cleaver (D-OH) and Vargas (D-CA) also continued their attacks on crypto from yesterday’s hearing, calling it dangerous and useless.

CONSUMER45.pdf…

15 09, 2022

DAILY091522

Eliza Allen2022-10-13T11:49:04-04:00September 15th, 2022|2- Daily Briefing|

Financial Transactions to Get More Stringent CFIUS Scrutiny

The President today issued an executive order (EO) redefining key criteria used by the Committee on Foreign Investment in the U.S. (CFIUS).

BNPL Faces DOA Consumer Standards

In conjunction with issuing a lengthy report, CFPB Director Chopra today announced that he has directed staff to work on new interpretive rules or guidance for the BNPL sector.

Basel Battles On

Acting as anticipated following instructions from on-high, the Basel Committee today “exchanged views” on pending crypto regulation (see FSM Report CRYPTO29) – terminology suggesting the committee has yet to reach agreement on this controversial consultation despite a request by central bankers and supervisory heads to finalize standards by year end.

Fed Joins Agencies with CRE Workout Policy

After a delay doubtless reflecting the need to run policies by Michael Barr, the FRB today proposed the same CRE-workout policies released for comment in early August by the OCC, FDIC, and NCUA.

Waters Tries Late-Game CRA Tackle

Chairwoman Waters (D-CA) today announced that she has introduced legislation to update the CRA, making the standards tougher for banks but – as far as known so far – failing to extend the law’s reach to nonbanks as urged by CFPB Director Chopra and Sen. Warren (D-CA), among others.

Daily091522.pdf…

3 08, 2022

DAILY080322

Eliza Allen2023-01-04T13:29:59-05:00August 3rd, 2022|2- Daily Briefing|

Senate Ag Crypto Bill Lauds CFTC, Faces Many Obstacles

As we anticipated as the crypto debate continues, the Senate Agriculture Committee has sought to claim jurisdiction with a new, bipartisan bill granting the CFTC broad regulatory, supervisory, and enforcement powers over most digital-asset platforms and the assets traded on them.

ECB Study Favors CBDCs Over Private Crypto for Cross-Border Payments

A study released by the ECB today argues that CBDCs would be a cheaper, safer, and more effective vehicle for cross border payments for global transactions than privately-issued cryptoassets or stablecoins. Based on assessment of global, not just EU markets, the study thus has implications for those in the U.S. opposing a CBDC.

FRB-Minneapolis Renews Attack on Big-Bank Capital Resilience

Renewing its attack on big-bank capital ratios, the Federal Reserve Bank of Minneapolis today released its own stress-test conclusions, reinforcing its president’s longstanding view that the largest U.S. banks are woefully under-capitalized even though test results show considerable variance on a bank-by-bank basis as well as overall resilience.

FRB Philadelphia President Touts Fintech’s Financial Inclusion Potential

FRB Philadelphia President Patrick Harker today stated that fintech can increase financial inclusion, specifically citing buy-now pay-later products because they offer financial services to low- to moderate-income customers who would otherwise be locked out of traditional lending because they are more likely to be non-White, lower earning, and younger.

Daily080322.pdf…

15 06, 2022

DAILY061522

Eliza Allen2023-01-26T13:40:01-05:00June 15th, 2022|2- Daily Briefing|

Thompson FHFA Sticks with Utilities for GSE Future Charters
The FHFA today issued its annual report to Congress. Although the first under now-confirmed Director Thompson, it follows the agency’s practice of reporting to Congress largely on past actions.

CFPB Demands Better BNPL Data, Improved Credit Reporting
Although the CFPB has taken no official action on buy-now/pay-later finance since its January RFI, it today issued a staff report on the sector containing a new statement of CFPB policy.

Basel Battens Down First Climate-Risk Hatch
The Basel Committee today issued a final version of its 2021 proposed set of high-level principles for managing climate risk (see FSM Report CLIMATE12). We will shortly provide clients with an in-depth assessment of this new global framework, which is also the starting gun for final action on OCC and FDIC risk-management guidance (see FSM Report GREEN12).

TD Merger Draws Democratic Fire
Reflecting continuing opposition to large-bank mergers, Sen. Elizabeth Warren (D-MA) along with Reps. Katie Porter (D-CA), Chuy García (D-IL), and Al Green (D-TX) today sent a letter to Acting Comptroller Hsu demanding that TD’s proposed acquisition of First Horizon Bank be denied unless or until the bank is held accountable for what the Members describe as flagrant consumer abuses.

Daily061522.pdf…

23 05, 2022

DAILY052322

Eliza Allen2023-02-21T13:53:43-05:00May 23rd, 2022|2- Daily Briefing|

FRB-NY Staff: Mandatory Flood Insurance Harms LMI Households

A New York Fed blog post today points to another important, unintended consequence of well-meaning regulation: the adverse impact of mandatory flood-insurance coverage on LMI households.

FRB Atlanta Staff Bolsters Proposed Cash Acceptance Mandate

A blog post today from the Federal Reserve Bank of Atlanta strengthens the case for the mandate for retailer cash acceptance recently approved by the House Financial Services Committee.

Kansas City Fed Finds Persistent Commodity-Market Price Hikes, Volatility

Reflecting concerns in a recent Petrou op-ed, the Federal Reserve Bank of Kansas City today released a report differing from the FOMC’s optimistic inflation forecasts at least as far as they relate to commodities.

HFSC Tackles Disability Rights

Tomorrow’s HFSC Subcommittee on Diversity and Inclusion hearing on disability rights will focus not only on housing access, but also on the extent to which a broad range financial services are easily accessible to persons with disabilities.

Fed Survey Shows Significant LMI Investment in Payment, Investment Crypto

The Fed today released a report on household well-being in 2021, detailing an array of survey findings that generally show Americans feeling remarkably prosperous and satisfied. The Fed cautions that this may no longer pertain, but the data do suggest what may be more than a passing rebound in economic resilience for at least some families.

Daily052322.pdf…