#Cook – Federal Financial Analytics

27 07, 2023

DAILY072723

Eliza Allen2023-07-27T17:47:02-04:00July 27th, 2023|2- Daily Briefing|

FSB Tries to Calm CoCo Confusion

Doubtless responding to the CoCo chaos when Credit Suisse failed, the FSB today issued a report laying out how cross-border crisis-management groups are to handle unallocated TLAC (UTLAC) such as the “alternative Tier 1” bonds popular in the EU.

FDIC 3-2 Vote Presages Knock-Down Basel Battle

As anticipated, the FDIC today voted 3-2 to issue a sweeping rewrite of U.S. regulatory capital requirements.

Divided, Cautious Fed Advances End-Game, GSIB Rewrites

As anticipated, Gov. Bowman today voted against the new capital framework, as did Gov. Waller; as a result, the vote was 4-2.

Stablecoin Bill Advances, Compromises to Come

At a fiery HFSC markup today, Chairman McHenry (R-NC) announced that bipartisan negotiations had broken down largely due to the White House, choosing to proceed to a final package as he remains open to amendment before floor action.

House Republicans Skewer Basel Rules

Hill comment so far in response to the new capital rules is sparse.

Daily072723.pdf…

12 07, 2023

DAILY071223

Eliza Allen2023-07-12T17:05:21-04:00July 12th, 2023|2- Daily Briefing|

SEC Concedes, Drops MMF Swing Pricing

In a startling bow to industry comments, the SEC today finalized MMF rules for institutional prime and tax-exempt funds that dispense with the proposal’s swing pricing (see FSM Report MMF19).

HFSC Bickers Over ESG, SEC Authority, Investor Rights

Today’s ESG hearing was the partisan show-down we anticipated – indeed, Rep. Sherman (D-CA) denounced the GOP for “waging war” against capitalism like Leon Trotsky.

Fed Nominations Advance

As anticipated, Senate Banking today approved the nominations of all three Federal Reserve Board nominees for the full Senate.

Warren Heightens Anti-Merger Campaign

Republicans were absent today from Senate Banking’s Economic Policy bank-merger hearing. Chair Warren (D-MA) reiterated her strong opposition to virtually all mergers, indicating her plans to reintroduce anti-merger legislation from prior Congresses (see FSM Report MERGER8).

Daily071223.pdf…

12 05, 2023

DAILY051223

Eliza Allen2023-05-12T17:05:25-04:00May 12th, 2023|2- Daily Briefing|

Bowman Blasts Barr

In another public sign of a growing FRB divide, Gov. Bowman early this morning followed Gov. Waller in taking strong issue with what would otherwise appear to be Board policy.

Fed Nominees Face Tough Confirmation Fight

In response to President Biden’s nomination of Philip Jefferson for Fed Vice Chair and Dr. Adriana Kugler and Lisa Cook to Fed Governor seats, Democrats have voiced strong support while Republicans are biding their time on nominations sure to prove controversial.

GOP Presses Broader FDIC, FRB Backstops

Picking up on the FDIC’s report (see Client Report DEPOSITINSURANCE119), Republicans have introduced legislation to provide limited coverage for transaction accounts and address other issues raised by recent events.

FRB-NY: SVB, Signature are 1930s Redux

Following on its post yesterday regarding changing bank-funding sources, the Federal Reserve Bank of New York today argues that the concentrated, uninsured deposit bases at SVB and SBNY are directly comparable to those of small rural banks in the 1930s.

Daily051223.pdf…

1 05, 2022

AL050222

William Cross2023-03-01T14:48:24-05:00May 1st, 2022|3- This Week|

Waiting in the Wings

Although the Senate last week confirmed Lael Brainard as the Fed’s new vice chair, Mr. Powell, Mr. Jefferson, and Ms. Cook remain on hold. The reason is political and powerful: the White House needs all the Democratic votes it can get to confirm Ms. Cook, several Democrats are out with Covid, and Mr. Powell’s confirmation is being held hostage to hers. All this will work itself out and all of the nominees will get confirmed, but it will take time. Similarly, Michael Barr will soon get his confirmation hearing to serve as Fed supervisory vice chair and then on to confirmation absent any untoward remarks or unknown facts Republicans can use to block him.

Al050222.pdf…

17 03, 2022

DAILY031722

Eliza Allen2023-04-03T14:33:52-04:00March 17th, 2022|2- Daily Briefing|

Fed, FHFA Leadership Advance

As anticipated last night, the Senate Banking Committee yesterday advanced all the Fed nominations and that of Sandra Thompson as FHFA director. However, Lisa Cook’s nomination was tied on a strictly partisan basis, meaning that it was not approved by Senate Banking but is nonetheless discharged to Senate Majority Leader Schumer (D-NY).

HFSC Hikes Array of Anti-Russia Sanctions

In the first of a series of markups, HFSC today approved 5 bills ramping up sanctions against Russia and Belarus. The most controversial of them, H.R. 7080 (Waters, D-CA), would broaden FinCEN’s ability to obtain information about the transactions of Russian oligarchs in the US.

Chopra Uses Rate Hike to Press Competition Inquiries

Describing the CFPB as “the arm of the Federal Reserve System that is fully focused on consumers,” Director Chopra today issued a statement following yesterday’s rate hike.

Senate Democrats Take Turns Whacking Wells Fargo

Senior Democrats today took sharp issue with Wells Fargo’s refi lending, asserting it was discriminatory and seeking an array of data from the bank and action by federal agencies. Senate Banking Chairman Brown (D-OH), Majority Whip Durbin (D-IL), and other senators called on HUD and the CFPB to investigate findings in a recent Bloomberg story, confining their comments to a general attack on discrimination without setting a date for a reply or any specific matters the agencies are to review.

Daily031722.pdf…

16 03, 2022

DAILY031622

Eliza Allen2023-04-03T14:41:40-04:00March 16th, 2022|2- Daily Briefing|

U.S. Merger Construct Clarity Delayed

The DOJ and FTC have extended the deadline for comment on the current U.S. antitrust construct.

Bureau Casts Wide, Sharp Net for Consumer-Finance Discrimination

Renewing his pledge to stamp out financial discrimination, CFPB Director Chopra today announced a new enforcement policy based on a revised examination manual.

Warren Demands Still More Antitrust Reform

Building on her campaigns against bank mergers (see FSM Report MERGER8) and more recent, broader competition concerns, Sen. Warren (D-MA) and Rep. Jones (D-NY) have introduced legislation barring large mergers in any sector and allowing the Department of Justice or FTC to break up companies without necessary resort to court order.

OCC Opens Window to AML Regtech

The OCC has finalized a rule based on its proposal allowing exemptions to SAR filing requirements for national banks and federal thrifts whose AML-compliance programs satisfy a set of criteria designed to spur regtech without undermining compliance. The final rule clarifies a critical question by making it clear that the OCC can only grant an exemption if FinCEN concurs.

Fed-Nominee Voting Advances

Due to the Fed’s monetary-policy shift, today’s press conference after the FOMC meeting provided few insights into regulatory policy. Chairman Powell reiterated that he would like a full Board complement but the System is functioning fine without one.

Daily031622.pdf…

15 03, 2022

DAILY031522

Eliza Allen2023-04-03T14:45:47-04:00March 15th, 2022|2- Daily Briefing|

House Readies Still Tougher Sanctions

Thursday’s HFSC mark-up will advance a series of bills ramping up sanctions designed as amendments to the omnibus legislation advancing through Congress to punish Russia and targeted allies. We expect all these bills to pass by wide margins, with additional measures added after tomorrow’s speech from Ukraine’ president; we will provide clients with an in-depth report of the mark-up and other actions related to financial markets.

What’s Next at the Fed

As anticipated, Sarah Bloom Raskin has reportedly withdrawn her nomination following indication from Sen. Manchin (D-WV) and two moderate Republicans that they will oppose her confirmation. Although this might clear the nominations of Chairman Powell, Gov. Brainard, Lisa Cook, and Phillip Jefferson, this will occur only if Chairman Brown (D-OH) is willing to sacrifice leverage over the next nomination for the supervision vice chair.

More on What’s Next for the Fed

President Biden’s statement today on Ms. Raskin’s withdrawal clarifies the outlook detailed in our alert earlier this afternoon. After praising the nominee, the president urges the Senate to quickly confirm Mr. Powell, Ms. Brainard, Ms. Cook, and Mr. Jefferson.

Daily031522.pdf…

14 03, 2022

DAILY031422

Eliza Allen2023-04-03T15:04:42-04:00March 14th, 2022|2- Daily Briefing|

IOSCO Adds Carbon-Market Review to Work Plan

IOSCO today released a comprehensive sustainability work plan, moving beyond the investor-focused disclosures it previously espoused set for action next week by the SEC. Going forward, global securities regulators have now prioritized reducing greenwashing and encouraging reliable ESG-impact assessment. IOSCO will thus review both the pending IFRS climate- and general-sustainability disclosure requirements and final standards.

Raskin Faces Still Higher Confirmation Odds

Sen. Manchin (D-WV)’s statement today that he will not support Sarah Bloom Raskin makes her path to confirmation difficult, if not impossible. For her appointment as Fed Supervisory Vice Chair to advance, at least one Republican would need to break ranks on the Senate floor even if Ranking Member Toomey (R-PA) is unable to hold his blockade.

Daily031422.pdf…

16 02, 2022

DAILY021622

Eliza Allen2023-04-04T15:53:29-04:00February 16th, 2022|2- Daily Briefing|

FSB Fears Crypto, Contemplates Response
The FSB today issued an in-depth report on systemic crypto risk, concluding that this could so quickly become a real threat that it could warrant preemptive intervention. Even so, the report provides no recommendations on how best to proceed, with global regulators confining themselves to a detailed presentation on vulnerabilities and resulting risk.

CFPB Opens Regulatory Portal to All Petitioners
Taking what it says are steps to democratize its rulemaking, the CFPB today established a process via which consumers may directly petition it to commence a rulemaking, also releasing a guide explaining the submission process.

FedFin Assessment: What’s Next for the Fed
As requested, this alert updates clients on the implications of yesterday’s GOP boycott of the confirmation votes in the Senate Banking Committee for President Biden’s FRB-leadership slate. As anticipated (see Client Report FEDERALRESERVE66), Sarah Bloom Raskin’s nomination as supervisory vice chair is proving to be particularly problematic, leading Democrats to try to attach Chairman Powell’s far more popular confirmation to the rest of the slate in hopes of forcing it through.

Daily021622.pdf…

3 02, 2022

FEDERALRESERVE69

Arezou Rafikian2023-04-05T14:06:42-04:00February 3rd, 2022|5- Client Report|

FedFin Assessment: Raskin Confirmation Possible, But a Squeaker

As this report details, all three Fed nominees before the Senate Banking Committee today emphasized the vital importance of Fed independence and their anti-inflation zeal to quell GOP opposition and cement it among moderate Democrats.

FEDERALRESERVE69.pdf…