%1

Treasury Secretary Steven Mnuchin said yesterday that he plans for action on the bailed-out government-sponsored enterprises Fannie Mae and Freddie Mac after the midterm elections in November, the Washington Examiner reported. Mnuchin also said that he would pursue bipartisan legislation to take the two mortgage giants out of the government’s custody, where they have lingered since 2008. Mnuchin also said that President Trump would look to replace the government regulator who oversees Fannie and Freddie. That position, the director of the Federal Housing Finance Agency, is held by Mel Watt, an Obama appointee. Watt’s term ends in early 2019. That will be an opportunity to “make sure we have someone in that job that supports the agenda,” Mnuchin said.

The U.S. House of Representatives could vote in May on a bill easing bank rules adopted after the 2007-2009 global financial crisis, a leading Republican lawmaker said yesterday, Reuters reported. The comments by Representative Kevin McCarthy, the House majority leader, marked the strongest sign yet that a deal could soon be reached between the House and Senate to pass the first rewrite of the 2010 Dodd Frank financial reform law. Last month the Senate voted 67-32 in favor of a bipartisan bill that would ease oversight of small and mid-sized banks. House Republicans have stalled voting on the Senate bill on the grounds that additional provisions should be included to further lower the regulatory burden on banks and to make it easier for small companies to raise capital. “I think you are within a month of getting it ... done,” McCarthy said. “At the end of the day there will be a bill at the President’s desk,” he added, pledging to deliver legislation to President Donald Trump before the 2019 midterm elections in November.

A Democratic senator who supports rolling back some of the financial rules put in place after the 2008 financial crisis warned bankers yesterday that the legislation will stall if it comes back to the Senate for another vote, the Associated Press reported. Sen. Mark Warner's (Va.) comments are a warning shot to House Republicans, who are insisting on adding to Senate-passed legislation that would scale back the law known as Dodd-Frank. "This bill will not pass if it comes back to the Senate," Warner said. "We stretched this about as far as we can go. The House of Representatives needs to accept this legislation." The Senate passed legislation in March targeting relief for all but the biggest banks. The House had earlier passed a more expansive bill that also went after the Consumer Financial Protection Bureau. The House version passed with no Democratic support.

The House is aiming to vote to repeal the controversial Consumer Financial Protection Bureau (CFPB) policy on auto-loan financing during the week of May 7, The Hill reported. Aides to House Majority Leader Kevin McCarthy (R-Calif.) laid out that plan while discussing the House agenda at a last week. The resolution to repeal the CFPB auto-lending guidance, which passed the Senate on Wednesday, is almost certain to clear the House and be signed into law by President Trump. The CFPB policy will likely be the first informal regulation to be repealed by Congress through the Congressional Review Act. Congress has used the Congressional Review Act (CRA) more than a dozen times since 2017 to repeal formal rules issued under former President Obama, but never to revoke guidance.

A top Federal Reserve official said yesterday that the central bank should go beyond the pending bipartisan Senate bill in providing regulatory relief for regional banks, the Washington Examiner reported. "Just as there is a strong public interest in the safety and soundness of the financial system, there is a strong public interest in the efficiency of the financial system," Fed vice chairman for supervision Randal Quarles said in remarks prepared for congressional testimony Tuesday, making the case for revisiting the post-crisis regulations that apply to banks. "There are further measures we can take to match the content of our regulation to the character and risk of the institutions being regulated," he said. As one example, he suggested that the Fed could revisit a rule that requires banks to maintain enough liquid assets that they could survive for a month just on the proceeds from selling them. He also proposed letting banks file "living wills" spelling out how they would go bankrupt without causing a crisis every two years rather than annually. Read more. 

Join thought leaders from academia and the bench, representatives from U.S. and European governmental agencies and private organizations on April 19 for a symposium to examine the policies, strategies and proposals erected in the 10 years since the Financial Crisis. Click here for more information and to register.

Congress appeared on the cusp of rolling back post-financial-crisis banking rules last month after Republicans and moderate Democrats passed a bill in the Senate, but now a standoff threatens to derail the effort entirely, the Washington Post reported. Rep. Jeb Hensarling (R-Tex.), chairman of the House Financial Services Committee, wants to change the Senate bill to bring it closer to a more expansive version of the rollback the House passed last year. For Hensarling, it is a last chance before retirement to take aim at the banking rules against which he has struggled for years, only to see his previous efforts stall in the Senate. The Democrats who backed the Senate bill are telling Hensarling their version is a take-it-or-leave-it proposition, saying that changes would imperil their coalition. White House officials are making clear that they want to see the legislation finalized sooner rather than later. President Trump said during a tax event in West Virginia last week that the banking bill “should be done fairly quickly.” Read more. 

Join thought leaders from academia and the bench, representatives from U.S. and European governmental agencies and private organizations on April 19 for a symposium to examine the policies, strategies & proposals erected in the 10 years since the Financial Crisis. Click here for more information and to register.

Leading banking groups yesterday called on House leaders to accept Senate-passed legislation easing financial rules adopted after the 2008 economic crisis, the Associated Press reported. Each chamber has already passed its own legislation on scaling back Dodd-Frank, but lawmakers disagree on how to move forward and pass a final version this year. The bank groups weighing in yesterday would seemingly give senators more leverage in the negotiations. In a letter to House Speaker Paul Ryan and Minority Leader Nancy Pelosi, the American Bankers Association said that it supports the desire among House Republicans to do more than what was passed in the Senate, but it believes the Senate bill will "make a very real difference to community banks across the country." The group called on the House to "move on" the Senate bill quickly and take up other House proposals later. State banking associations made a similar plea, calling on the House "to immediately take up and pass" the Senate bill. Read more. 

Join thought leaders from academia and the bench, representatives from U.S. and European governmental agencies and private organizations on April 19 for a symposium to examine the policies, strategies & proposals erected in the 10 years since the Financial Crisis. Click here for more information and to register.