#regulation – Federal Financial Analytics

11 05, 2023

Daily051123

Arezou Rafikian2023-05-11T17:10:33-04:00May 11th, 2023|2- Daily Briefing|

Treasury Presses Fed Efforts to Contain Systemic Liquidity Risk

In remarks today, Treasury Under-Secretary Nellie Liang addressed systemic liquidity risks such as the 2020 dash-for-cash and recent bank failures. Treasury is cautiously optimistic about increasing regional-bank stability, but systemic liquidity risk is now structural.

FDIC Proposes Special, Costly Uninsured-Deposit Assessment

The FDIC today voted 3-2 to propose the special assessments presaged in Chairman Gruenberg’s Congressional testimony after SVB and SBNY’s failures (see Client Report REFORM218). Notably, the assessment does not also cover the $13 billion of cost estimated for the FRC rescue in conjunction with JPMorgan’s purchase; its rescue was not technically systemic and its cost will thus be covered as the FDIC reviews DIF ratios in coming meetings at which more broadly-shared, traditional premiums are likely also to increase.

GOP Endorses GAO Recommendations; Dems Point To Bank Management

At today’s HFSC Oversight Subcommittee hearing on the GAO’s report (see Client Report REFORM223), Subcommittee Chair Huizenga (R-MI) built the case that the Fed has historically been unable to properly supervise troubled banks and noted that the committee will investigate this along with the Systemic-Risk Exception used in recent failures.

Waller Disavows Fed Climate-Risk Action

Confirming the Fed’s omission of climate risk in its new financial-stability report (see Client Report SYSTEMIC96), Gov. Waller today said not only is climate risk not now a threat to financial stability, but it also does not pose a safety-and-soundness hazard to large banks.

FRB-NY Data Contradict Story …

28 03, 2023

REFORM217

William Cross2023-03-28T16:28:44-04:00March 28th, 2023|5- Client Report|

Senate Banking Demands Supervisory Accountability, Transparency, Reform

Today’s Senate Banking hearing was extremely well-attended by Senators on both sides of the aisle clearly looking first to understand what precipitated recent bank failures, who is to blame, and what should be done next. Republicans argued that current law gives the Fed considerable discretion without the need for statutory change. Although FRB Vice Chairman Barr initially sought to emphasize the need for new rules without blaming old ones, he ultimately admitted that the Fed indeed could and can govern risky banking organizations regardless of size.

REFORM217.pdf…

28 03, 2023

FedFin on: Senate Banking Demands Supervisory Accountability, Transparency, Reform

Arezou Rafikian2023-04-03T12:47:49-04:00March 28th, 2023|The Vault|

Today’s Senate Banking hearing was extremely well-attended by senators on both sides of the aisle clearly looking first to understand what precipitated recent bank failures, who is to blame, and what should be done next. Republicans argued that current law gives the Fed considerable discretion without the need for statutory change. Although FRB Vice Chairman Barr initially sought to emphasize the need for new rules without blaming old ones, he ultimately admitted that the Fed indeed could and can govern risky banking organizations regardless of size….

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

14 12, 2022

CRYPTO36

William Cross2022-12-14T17:26:30-05:00December 14th, 2022|5- Client Report|

Brown Backs Away from Crypto Legislation, Presses Again for New Rules

Senate Banking Committee Chairman Brown (D-OH) today backed away from prior statements about crypto legislation, focusing instead on the prospect of additional investigations into failing crypto firms and ongoing work with Secretary Yellen on a government-wide regulatory framework. Today’s hearing still centered on legislative action, with Sen. Warren (D-MA) along with Sen. Marshall (R-KS) releasing new legislation to subject crypto firms to AML rules comparable to those applied to banks along with banning crypto mixers. Sen. Lummis (R-WY) announced that she will reintroduce her stablecoin bill next year with Sen. Gillibrand (D-NY) (see FSM Report CRYPTO28), revising it in light of recent crypto debacles. Sen. Haggerty (R-TN) flagged Binance’s newfound monopoly power and ties to China as a major concern, an issue echoed by Sen. Warner (D-VA) and, in conjunction with Chairman Brown’s investigative agenda, may well subject the world’s largest crypto exchange to U.S. legislative scrutiny if its current liquidity challenges do not preoccupy attention next year.

CRYPTO36.pdf…