#Harper – Federal Financial Analytics

15 11, 2023

REFORM230

Eliza Allen2023-11-15T15:58:45-05:00November 15th, 2023|5- Client Report|

Bipartisan Capital Bashing Continues in the House

Following yesterday’s Senate Banking hearing (see Client Report REFORM229), today’s HFSC session with top bank regulators again highlighted growing bipartisan consternation over the unintended consequences of the agencies’ capital proposal (see FSM Report CAPITAL230). Although Ranking Member Waters (D-CA) echoed Chairman Brown’s defense, Democratic criticism today went beyond concerns about mortgages and green bonds also to address credit availability, new trading and derivatives standards, capital recognition of securities losses, and insufficient review of the proposal’s quantitative impacts. Republicans continued to bash the proposal for what they said is insufficient economic analysis. Unlike yesterday, attention to the FDIC’s harassment scandal most notably came from Democrats’ side of the aisle, with Ranking Member Waters using all of her questioning time to criticize the FDIC and request a report from each agency describing how they will review sexual-harassment. Reiterating concerns he and Subcommittee on Financial Institutions Chairman Barr (R-KY) recently raised regarding regulators’ interactions with international standard-setters, Chairman McHenry grilled Vice Chair Barr and Acting Comptroller Hsu about staff compensation and agency documentation practices at international events. Mr. Barr emphasized that all Board and staff member compensation comes from the Fed, while Mr. Hsu only said that his agency tracks participation in these bodies to ensure mission alignment. We continue to expect GOP pressure on the international-agency front but no action until GAO completes its report. Chair Gruenberg noted broad alignment with a new incentive-compensation proposal, but revised the initial timeline …

14 11, 2023

REFORM229

Eliza Allen2023-11-14T15:57:18-05:00November 14th, 2023|5- Client Report|

Capital Proposal Gets Bipartisan Bashing in Senate Banking

Today’s Senate Banking hearing with top bank regulators showcased broad bipartisan concern over the interagency capital proposal (see FSM Report CAPITAL230). Although Chairman Brown (D-OH), Sen. Warren (D-MA), and Sen. John Fetterman (D-PA) staunchly defended the proposal on countercyclicality grounds, other senators on both sides of the aisle sounded the alarm over its impact on credit availability, small-business lending, and shadow-bank migration. FRB Vice Chair Barr repeatedly defended his agency’s analysis while emphasizing openness to comment, also highlighting that the proposal relates primarily to non-credit activity and would apply to only 37 banks. Some Republicans also raised concerns over other recent rulemakings, with Sen. Britt (R-AL) asking Vice Chair Barr if the agencies would consider a comment deadline extension for the LTD proposal (see FSM Report TLAC9). Although Mr. Barr stated that the rule is far simpler than the capital proposal, he also said the agencies would consider a similar extension. FDIC Chairman Gruenberg drew bipartisan ire over reports of FDIC widespread harassment, with Republicans seizing the occasion to criticize Mr. Gruenberg’s leadership. Grilled by Sen. Tillis (R-NC) about reports of a Fed leak of confidential supervisory information, Mr. Barr only said that he is deeply concerned. Separately, Chairman Brown emphasized unfinished work on bank executive accountability and urged Congress to pass the RECOUP Act (see FSM Report COMPENSATION37), which passed the Committee nearly unanimously in July.

REFORM229.pdf…

14 11, 2022

DAILY111422

Eliza Allen2022-11-14T17:00:05-05:00November 14th, 2022|2- Daily Briefing|

FSB Thinks 2020 Reg Relief Could Go, Stay – It All Depends

In conjunction with the G20 summit, the FSB has released a policy paper assessing the extent to which various pandemic-related regulatory forbearances should be continued.

FSB Reiterates Climate, Crypto, NBFI Plans

The FSB head’s letter to the G20 today reiterates all of the priorities expressed in its October letter to G20 finance ministers.

Regulatory Hearings to Address Last-Gasp 2022 Agenda, Position Panels for a Busy New Year

With GOP House and Democratic Senate control largely assured, this week’s hearings with Messrs. Barr, Gruenberg, Harper, and Hsu will illuminate not only current priorities – most notably what’s next for federal crypto law and rule – but also the very different priorities HFSC and Senate Banking will advance in the next Congress.

FRB-NY Staff: Big U.S. Banks Remain Extremely Resilient

In its latest assessment of the vulnerability of the fifty largest U.S. BHCs, Federal Reserve Bank of New York staff confirmed the overall rosy assessment of bank resilience in the Board’s latest financial-stability report (see Client Report SYSTEMIC94).

OCC Ramps Up Fair-Lending Enforcement

In remarks delivered for Acting Comptroller Hsu, Senior Deputy Comptroller for Bank Supervision Policy Grovetta Gardineer reiterated that ensuring fairness is a top OCC priority.

Gruenberg Finally Gets the Nod

Knowing now that he has secured Democratic Senate control into next year, President Biden today finally and formally nominated Acting FDIC Chairman Gruenberg to assume the chairmanship.

Daily111422.pdf…

19 01, 2022

Daily011922

Arezou Rafikian2023-04-24T13:33:40-04:00January 19th, 2022|2- Daily Briefing|

GOP Signals Congressional CBDC Strategy
Although the bill will not pass in this Congress, we draw client attention to H.R. 6415, legislation just now noted in the Congressional Record to bar the FRB from offering the “FedAccounts” Democrats espouse (see FSM Report CBDC).

OCC Grants Non-Traditional Charter Conditions on BHC Status
After close of business yesterday, the OCC gave conditional approval to SoFi’s acquisition of an insured depository and thus to its charter now as a full-service national bank. The approval signals not only that the OCC will approve acquisitions and continue to charter national banks even in non-traditional cases, but also that the moratorium on crypto charters remains in full force.

Senate Banking Split on Several Key Nominations
The Senate Banking Committee today voted on several key Biden Administration nominees without taking up any of the pending Fed appointments. The narrowness of several votes makes it clear that, as we anticipated (see Client Report FEDERALRESERVE66), controversial appointments such as Sarah Bloom Raskin and Lael Brainard have uncertain futures.

Large Banks Lead on D&I, CFPB Study Finds
The CFPB today released a report analyzing publicly-available FY2020 diversity and inclusion data for depository and nondepository institutions, putting forward a series of best practice recommendations.

Daily011922.pdf…