FRB

The Federal Reserve recently finalized rules establishing a tailored framework for regulations applying to domestic and foreign banks.

The rules are designed to more closely match institutions’ risk profiles, reducing compliance requirements for firms with less risk while maintaining the most stringent requirements for the largest and most complex institutions.

Get more details about the implications of the newly finalized rules.

In a move that has major implications for mortgage lenders and appraisers, the Federal Reserve, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency finalized a joint rule to increase the threshold for residential real estate transactions requiring an appraisal from $250,000 to $400,000.

The Consumer Financial Protection Bureau’s required letter weighing in on the measure closely reflected contentions put forth by financial institutions and the trade associations.

Learn more details about the final rule and stakeholder reactions.

To enact the level of regulatory relief intended by Congress, several legislators and the Independent Community Bankers of America (ICBA) have demonstrated that they are in sync in believing federal banking regulators should finalize joint rulemaking setting the community bank leverage ratio (CBLR) at 8 percent.

Eighteen Republicans on the House Financial Services Committee wrote to federal regulators, urging them to enact the 8 percent CBLR, rather than the 9 percent ratio the agencies proposed in November 2018.

Read on for more details about their reasoning.

The Senate has voted to extend Michelle “Miki” Bowman’s tenure as the first person to hold the Federal Reserve Board’s seat designated for a person with community banking experience for a full 14-year term.

The Independent Community Bankers of America (ICBA) welcomed the news, having strongly supported Bowman’s nomination to join the Fed prior to her confirmation in November 2018 and urged the president to renominate her to a full term.

Find out more about Bowman’s renomination and her views on regulation.

Less than a month after the Federal Reserve’s first interest rate cut since the financial crisis, Federal Reserve Chairman Jerome Powell gave indications that another cut could be on the horizon, according to some economists.

Given that the July drop in interest rates had little impact on mortgage rates, which are at their lowest levels since 2016, it is difficult to say what impact another Fed-initiated interest rate dip would have for mortgage lenders.

Learn more about the implications of Powell’s speech and of a possible impending rate cut.

Republicans on the Senate Banking Committee recently wrote to federal banking regulators to urge the swifter adoption of changes made from recent regulatory financial reform in S. 2155.

“More can still be done to support the economic expansion,” the senators, led by Chairman Mike Crapo (R-Idaho), said in the letter.

Read on for details of where the senators want regulators to focus their efforts to hasten regulatory relief.

By pledging to develop a real-time gross settlement service called FedNow Service to enable community banks and credit unions to offer the same types of expedited payment processes as large banks, the Federal Reserve alleviated concerns for certain trade advocates worried about the prospect of a large-bank monopoly on such services.

Numerous financial trade advocates have urged the Fed to use its authority to create such a tool to level the playing field in the real-time payments market.

Find out more about the planned new payments system.

Although the Federal Reserve’s decision to begin developing a real-time gross payment settlement system aligns with advocacy goals stated by community banks and credit unions, not all industry insiders believe it is the right call for the financial marketplace.

Brookings fellow Aaron Klein recently wrote the Fed, describing why the creation of such a system highlights a conflict in the Fed’s statutory mission.

Learn what points he made in his comment letter.

Federal regulators recently outlined a new risk-based approach to assess banks for Bank Secrecy Act/anti-money laundering (BSA/AML) rule compliance as part of an ongoing effort to increase transparency regarding their supervisory process.

Through its risk-focused approach, the federal agencies and the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) said they intend to better tailor examination plans and procedures based on the unique risk profiles of individual banks in a joint statement.

Find out more about the new risk-based approach.

The Federal Reserve and the Federal Deposit Insurance Corp. (FDIC) recently completed their 2018 resolution plan evaluations for several systemically-important foreign and domestic banks and extended the next deadline for those firms to submit their strategies for rapid, orderly liquidation in the event of a failure.

The extensions are intended to afford the banks additional preparation time to account for pending amendments to resolution planning rules, affecting domestic banks and foreign banks with U.S. operations with more than $100 billion in total consolidated assets.

Find out more details about the plan assessments and deadline extensions.