#Wells Fargo – Federal Financial Analytics

18 04, 2024

DAILY041824

Eliza Allen2024-04-18T17:08:48-04:00April 18th, 2024|2- Daily Briefing|

G7 Backs NBFI Reform

Although prioritizing Ukraine and broad statements about the global economy, the new statement from G7 finance ministers and central bankers also emphasizes the need to pursue the kind of NBFI reforms advanced yesterday by the FSB.

Bowman Battles New Liquidity Regs

FRB Gov. Bowman today reiterated her conviction that sufficient contingency funding should be a matter between banks and supervisors, not a cause for new rules.

Brown, Reed Press Big Banks on Wire Transfer Fraud

Building on their longstanding campaign pressing banks on Zelle, Senate Banking Chair Brown (D-OH) and Sen. Reed (D-RI) today sent letters to the CEOs of JP Morgan, Wells Fargo, Bank of America, and Citi stating that banks have a responsibility to proactively monitor and prevent fraudulent wire transactions and should reimburse customers when these obligations are not met.

House Select Committee Targets Index-Fund Chinese Investments

Building on its prior report pressing financial institutions to address exposures to China and potential systemic risks, the House Select Committee on the CCP today released a bipartisan report sharply criticizing index-fund and asset managers for investing American savings in sanctioned Chinese companies associated with the PLA and/or human-rights abuses.

Daily041824.pdf…

1 12, 2023

Al120423

Eliza Allen2023-12-01T16:41:48-05:00December 1st, 2023|3- This Week|

Capital Conundrum

Early signals indicate that GSIB CEOs summoned this week before Senate Banking will do their best to use the session to solidify Congressional calls for substantive changes in pending capital rules based on a far more transparent, systematic CB analysis. Signals such as the Brown/Reed letter last week also make it clear that Democrats will push hard for tougher GSIB-specific standards to offset increasingly-likely changes to the capital rules. Democratic advocates of specific changes – i.e., with regard to LMI mortgages and small-business credit – will also use the session to navigate a path between helping regional banks on key points while looking tough on the overall question of big-bank capital. Again, sticking it to GSIBs may be their tactic. Republicans won’t let up against the capital rules, but we suspect they’ll also focus on borrowers and regional banks, side-stepping GSIB surcharges and other top-tier questions wherever possible.

Al120423.pdf…

4 10, 2023

DAILY100423

Eliza Allen2023-10-04T16:40:00-04:00October 4th, 2023|2- Daily Briefing|

Bowman Unbending in Demands for Better Reg Analytics, Community-Bank Mergers

In what might have been only perfunctory introductory remarks, FRB Gov. Bowman today instead continued her all-out campaign to force far more independent research before the Fed finalizes pending rules.

Brown Asks for No Wells Fargo Mercy

Senate Banking Chairman Brown (D-OH) today sent a letter to FRB Vice Chair Barr and OCC Acting Comptroller Hsu taking serious issue with what he calls unfair labor relations practices, consumer abuses, and compliance failures at Wells Fargo, urging the regulators to take stronger action to change the bank’s culture.

McKernan Counters Gruenberg on Endgame’s Nonbank Effects

Fleshing out official comments made in dissent against pending rules, FDIC Board member Jonathan McKernan today countered Chair Gruenberg’s recent comments that any migration of bank activities to nonbanks due to the capital rules should not be considered in the regulatory process.

Gruenberg Reiterates His Top Risk Worries

As with Gov. Bowman earlier today, FDIC Chair Gruenberg used his remarks later in the day to emphasize continuing concerns: in this case, uninsured deposits, maturity mismatches, and rapid growth.

Daily100423.pdf…

14 06, 2023

CONSUMER51

Eliza Allen2023-06-14T16:55:35-04:00June 14th, 2023|5- Client Report|

Chopra Holds His Own Under GOP SVB, Consumer-Protection Attack

With Rep. Andy Barr (R-KY) leading the attack with an accusation of CFPB “McCarthyism,” today’s HFSC hearing with Director Chopra tracked much in yesterday’s Senate Banking session. As before, Republicans strongly attacked the credit-card late-fee proposal (see FSM Report CREDITCARD36) and new small-business reporting requirements. However, the lengthy session also allowed Members on both sides of the aisle to probe issues to which Senate Banking failed to turn. One of these was the FDIC’s decision to establish bridge banks for SVB and Signature and to sell FRC to JPM. Mr. Chopra vigorously denied any role of what some have called progressive ideology in opposing bids for SVB, noting also systemic concerns at that time partly due to fears about Credit Suisse. The agency’s controversial data-rights proposal will be out in October, with Director Chopra saying also that the proposal covers nonbanks by virtue of the data to be covered. Provider cyber-security will also be addressed. This report covers additional high-impact issues at the hearing including AI, UDAAP, and systemic designation.

CONSUMER51.pdf…

17 01, 2023

DAILY011723

Eliza Allen2023-01-17T17:03:48-05:00January 17th, 2023|2- Daily Briefing|

FinCEN Opens Beneficial-Ownership Reports to Public Comment

Likely furthering its effort to garner greater public buy-in for its beneficial ownership information (BOI) standards, FinCEN is now requesting public comment on these reports.

CFPB Presses Consumers, Employees to Action

In a post today, the CFPB double-downed on its recent precedent-setting enforcement action against Wells Fargo (see Client Report CONSUMER46).

Breaking Up Won’t Be Hard to Do

In a high-impact speech today, Acting Comptroller Hsu expressly threatens that the OCC will not stop at the kind of growth restrictions imposed on Wells Fargo (see Client Report CORPGOV26) or the CFPB’s fines (see Client Report CONSUMER46) if a large bank is a repeat offender in safety-and-soundness arenas.

Fed Begins Big-Bank Physical/Transition Financial Climate Risk Analysis

The Fed today announced a two module structure for its upcoming GSIB pilot climate scenario analysis, kicking off a process to identify the data, governance, and processes banks need to manage the financial risks related to physical and transition climate events.

Daily011723.pdf…

21 12, 2022

FedFin on: Nonbank Enforcement-Order Registry

Arezou Rafikian2022-12-21T16:54:37-05:00December 21st, 2022|The Vault|

The CFPB is proposing to create a public registry of certain enforcement actions that would initially cover nonbanks (including BHCs) with a goal of drawing public and enforcement-agency attention to what the Bureau’s director calls “serial offenders.” …

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

21 12, 2022

CONSUMER47

Eliza Allen2022-12-21T15:27:45-05:00December 21st, 2022|1- Financial Services Management|

Nonbank Enforcement-Order Registry

The CFPB is proposing to create a public registry of certain enforcement actions that would initially cover nonbanks (including BHCs) with a goal of drawing public and enforcement-agency attention to what the Bureau’s director calls “serial offenders.” The new filings would be extensive and likely expensive in terms not just of the filings, but also of the analytical processes needed to ensure accuracy and the internal controls assuring officers making requisite attestations that their statements are complete and accurate. Public disclosure of much in the filings – including information that companies consider confidential – would make it easier for other enforcement agencies to identify institutions that may also have violated their own standards as well as alert state and federal banking agencies to entities under their supervision with potential compliance and risk-management shortcomings.

CONSUMER47.pdf…

20 12, 2022

DAILY122022

Eliza Allen2022-12-20T17:18:34-05:00December 20th, 2022|2- Daily Briefing|

CFPB Reaches Massive, Policy-Setting WFC Agreement

The CFPB today reached a landmark and perhaps even unprecedented $3.7 billion settlement with Wells Fargo on an array of “surprise-fee” and bad-practice allegations. Because of the scope of this action and Director Chopra’s plans to use it as grounds for still greater penalties against WFC, we will shortly provide clients with an in-depth analysis of its policy and strategic implications.

Despite Fears, FSB Finds NBFIs Sound In 2021

Although the FSB’s most recent NBFI report (see Client Report NBFI2) and FSOC’s new annual update (see Client Report FSOC28) cite investment funds as a significant concern, FSB’s latest NBFI 2021 monitoring report concludes that most balance-sheet risk measures remained stable. It does note that collective investment vehicles – a category that subsumes MMFs and other funds – experienced the largest growth in the report’s “narrow measure” and continued to have elevated levels of credit intermediation and liquidity and maturity transformation.

Daily122022.pdf…

20 12, 2022

FedFin on: CFPB Crafts New-Style, High-Impact Enforcement Construct

Arezou Rafikian2022-12-20T17:22:32-05:00December 20th, 2022|The Vault|

In this report, we provide an in-depth assessment of the CFPB’s unprecedented $3.7 billion settlement earlier today with Wells Fargo (WFC). In its release, the Bureau notes that it worked with the FRB and OCC to craft this consent agreement; in his remarks, Director Chopra makes it clear that, settled or not, he wants to penalize a “corporate recidivist” by retaining or even tightening the Fed’s 2018 asset-cap (see Client Report CORPGOV26) and doing the same with the OCC’s 2021 mortgage-servicing settlement….

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

20 12, 2022

CONSUMER46

Eliza Allen2022-12-20T15:28:41-05:00December 20th, 2022|5- Client Report|

CFPB Crafts New-Style, High-Impact Enforcement Construct

In this report, we provide an in-depth assessment of the CFPB’s unprecedented $3.7 billion settlement earlier today with Wells Fargo (WFC). In its release, the Bureau notes that it worked with the FRB and OCC to craft this consent agreement; in his remarks, Director Chopra makes it clear that, settled or not, he wants to penalize a “corporate recidivist” by retaining or even tightening the Fed’s 2018 asset-cap (see Client Report CORPGOV26) and doing the same with the OCC’s 2021 mortgage-servicing settlement. The case has also reopened calls to revoke WFC’s status as a financial holding company, action authorized in Dodd-Frank (see FSM Report FHC19) that would sharply constrain the company’s non-traditional securities and insurance activities and establish precedent for this penalty in other large-BHC consumer actions. Although WFC does not admit or deny the Bureau’s charges beyond accepting those specific to its jurisdiction, the Bureau has mandated agreement to several provisions that heighten the settlement’s cost to the bank.

CONSUMER46.pdf…