Chairman Bachus Releases Report on Dodd-Frank and Too-Big-to-Fail

Financial Services Committee Chairman Spencer Bachus (R-Ala.) released “The Dodd-Frank Act, the Persistence of ‘Too-Big-to-Fail,’ and the Institutionalization of Government Bailouts.” The report presents a seven-page analysis prepared by Committee staff that highlights how too-big-to-fail and potential bailouts remain a genuine concern. The Ranking Member of the House Financial Services Committee Barney Frank (D-Mass.) also released this week an analysis of the impact on too-big-to-fail under the Dodd-Frank Act.

ICBA Suggests Improvements to CFPB's Proposed Mortgage Appraisal Rule
In a comment letter to the Consumer Financial Protection Bureau (CFPB), ICBA expressed concerns about a proposed mortgage appraisal rule drafted to implement amendments to Regulation B under the Equal Credit Opportunity Act (ECOA). The CFPB’s proposed ECOA revisions would require creditors to provide free copies of all written appraisals and valuations developed in connection with an application for a loan to be secured by a first lien on a dwelling. The proposal also would require creditors to notify applicants in writing of the right to receive a copy of each written appraisal or valuation at no additional cost.

ICBA asked the CFPB to narrow its definition of valuation in the rule so that creditors are only required to provide consumers with the final written valuation and not also additional valuation review documents or analysis. The association also urged the bureau to allow community banks to be reimbursed for the photocopy and postage costs of providing an appraisal or valuation, as these costs would be difficult for community banks to absorb and exclude from the overall costs of providing an appraisal or valuation.
Further, ICBA recommended that the ECOA appraisal disclosure be made with the revised RESPA-TILA Loan Estimate disclosure and that the CFPB not require that the ECOA disclosure be made separate from other disclosures. While avoiding a piecemeal disclosure process that would be more costly and burdensome to community banks, ICBA wrote, this approach to present a single set of regulatory disclosures would be less confusing for consumers as well. Read ICBA Comment Letter.

CFPB Announces Proposal Making it Easier for Stay-at-Home Spouses and Partners to Get Credit Cards
The Consumer Financial Protection Bureau proposed updates to existing regulations to make it easier for spouses or partners who do not work outside of the home to qualify for credit cards. The proposal would allow a stay-at-home spouse or partner to rely on shared income from his or her spouse or partner when applying for a credit card account.

The bureau’s proposed revision would allow credit card applicants who are 21 or older to rely on third-party income to which they have a reasonable expectation of access. Although the proposal applies to all applicants regardless of marital status, the bureau expects that it will ease access to credit particularly for stay-at-home spouses or partners who have access to a working spouse or partner’s income.

In January 2010, ICBA sent a letter to the Federal Reserve advocating for this change. ICBA stated it opposed any amendments to Regulation Z that would not allow this income to be considered, "because of the implications it would have for individuals over the age of 21 who may have a household income but not an independent income. One example would be a stay-at-home spouse who is part of a household but does not have an income independent of his or her working spouse,” ICBA wrote. “Such a requirement seems to ignore the way many households operate in the United States, and would ironically further limit access to credit at a time when consumers need it the most.”


ICBA Chief Economist Speaks on Importance of Community Banks at NABE Conference
Community banks serve a critical role in preserving a first-class financial system, small business lending and economic growth was the key message that Executive Vice President and Chief Economist Paul Merski conveyed at the National Association of Business Economics Annual (NABE) Conference in New York City this week. During the “New Financing Environment for Small Business” session, Merski emphasized the importance of a temporary extension of the FDIC TAG program and a tiered regulatory approach, especially on the Basel III capital proposal.

Attendees also heard from Sheila Bair, 19th chairperson of the U.S. Federal Deposit Insurance Corp.; William C. Dudley, president, Federal Reserve Bank of New York; Roger W. Ferguson Jr., former vice chairman of the Board of Governors of the Federal Reserve System; Glenn Hubbard, dean, Columbia Business School; George Soros, chairman, Soros Fund Management; and Gene Sperling, director, National Economic Council.

NABE economists released their latest economic forecast indicating “tepid” growth for the U.S. with 1.9 percent GDP growth in 2012, rising to a 2.4 percent rate for 2013. The jobless rate is estimated to increase to 8.1 percent by the fourth quarter of 2012 before slowly falling to 7.8 percent by the fourth quarter of 2013.

ICBA Offers Consumers Mobile Banking Safety Tips
As mobile and online banking grows in popularity, ICBA is offering consumers advice on how to safely use mobile banking. In a national news release that community banks can customize for their local media, ICBA provides seven tips on the safe use of mobile banking, including advice on how to protect account numbers and avoiding fraudulent requests. The release also encourages consumers to contact community banks directly if they need additional insight. Read ICBA Release. Access Custom Release.

September Housing Starts, Building Permits Spike
Housing starts rose 15 percent to a seasonally adjusted annual rate of 872,000 in September and are up 34.8 percent from a year ago, according to the Commerce Department. Single-family starts were up 11 percent. Building permits were up 11.6 percent to a seasonally adjusted rate of 849,000 and is up a whopping 45.1 percent from Sept. 2011.

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Take this week’s Quick Poll on comment letters on Basel III regulatory capital standards, and view results from the previous poll on ATM fee disclosure lawsuits.

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