Richard's Rapid Fire - April 20, 2018

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CBA-Backed Effort to Overturn CFPB's 2013 Auto Bulletin Passes U.S. Senate – CBA member banks are strongly committed to ensuring fair lending policies and practices are upheld while fulfilling consumers’ financial needs. The CFPB’s 2013 Auto Bulletin was a backdoor attempt at rulemaking without notice or comment and lacked the clarity needed by lenders, which is why CBA supported the Senate’s efforts to overturn it.Without question, our members are opposed to all forms of lending discrimination in the marketplace. For these reasons, clear regulatory rules and guidance must be in place to ensure compliance. 

 

Next Steps – Senators Jerry Moran (R-Kan.) and Pat Toomey (R-Penn.) led the effort in the Senate and Congressman Lee Zeldin (R-N.Y.) has introduced a companion bill in the House. While no date has been set, we expect the House to pass this resolution too, sending the CRA to President Trump's desk for signing.

 

Fed’s Quarles: CRA Coming Off Autopilot – Comments made by the Federal Reserve’s Vice Chair of Supervision Randal Quarles indicate the OCC, FDIC and Federal Reserve will coordinate when modernizing the Community Reinvestment Act (CRA). Comptroller of the Currency Joseph Otting previously mentioned banking regulators will act in unison. CBA has been active on this front and we welcome a modernization of the CRA.

 

Fed Governors in their Own Words on CRA – Modernizing the CRA has received support from Members of the Federal Reserve Board:

  • Federal Reserve Vice Chair of Supervision Randal Quarles: “CRA discussions have had the full engagement of all three of the banking regulators. So far, they have been — and I have no reason to expect that that would change — they've been collaborative among all three of us.”
  • Federal Reserve Governor Lael Brainard: “The time is ripe to modernize the CRA regulations to make them more effective…It should be possible to achieve better outcomes—both providing banks with the greater clarity and predictability they seek while also facilitating better provision of credit, investments, and banking services in low- and moderate-income areas.”

 

TCPA Needs Improvements – The influx of fraudulent and illegal robocalls by bad actors has become an ever-growing problem for consumers. This week, Congress examined how to prevent these burdensome calls. It is, however, imperative to distinguish these robocalls from the beneficial communications between legitimate businesses and their customers. Seeking to highlight these important differences, CBA submitted a letter for the Congressional record and coordinated a joint trades letter to the Senate Commerce Committee on the issue. The House was expected to hold a hearing on the topic this week as well, but has been postponed and has yet to be rescheduled. 

 

 

ACTING DIRECTOR MULVANEY HEARINGS IN REVIEW

Mulvaney Key Takeaways – Last week we gave a detailed readout of Acting CFPB Director Mick Mulvaney’s testimony before Congress, but there are many noteworthy developments. 

 

CBA’s key takeaways from Mulvaney are below:

   
  • Expect an end to the practice of “regulation through enforcement.”
  • With over 240 known "lapses" in data security, a third-party was hired to test the CFPB's internal security systems.
  • The CFPB's cost benefit analysis will be more quantitative than qualitative.
  • There are 100 ongoing investigations, including 25 against payday lenders.
  • Overdraft will not be included in the CFPB's next regulatory agenda.
  • CFPB ended an EEOC plan which would help the Bureau determine employee pay.
  • Serve as Acting Director until a successor is confirmed by the Senate so long as one is nominated by June 22.
  • Reduced staffing levels by 10 employees and maintains a workforce of nearly 1,700.
  • Asked for guidance from Congress as to the definition of “abuse,” under CFPB’s UDAAP authority. 
  • CFPB was previously working on an airport project, which had nothing to do with consumer protection.
  • Understands the CFPB’s legal right to collect data on credit and debit cards, and home and auto loans.
  • Believes he has met with as many outside groups as industry groups.
  • Discussed working with Sen. John Kennedy (R-La.) on legislation requiring credit rating agencies to allow consumers to request credit history corrections.
  • On the Bureau’s Mission: “We are enforcing the law. I want to be perfectly clear. Do I have criticisms of this bureau? I absolutely do, but I’m trying to be a good bureaucrat.
 

 

Most Importantly: Mulvaney Supports a Commission – During last week’s hearings, Mulvaney noted his support for establishing a commission at the CFPB, and this week he reiterated his support before a House Financial Services Subcommittee.

 

In Case You Missed Senator Tom Cotton’s Questions – Senator Tom Cotton (R-Ark.) was on point in his questioning of Acting Director Mulvaney last week and I would encourage you all to watch the back and forth regarding his support for a commission at the CFPB.

 

 

TRENDING IN RETAIL BANKING

Learn How to Build Better Bankers on CBA’s Suite 550 Podcast –Want to take your banking knowledge to the next level? Join CBA Executive Banking School Faculty and Staff in the latest episode of CBA’s Suite 550 podcast to learn about CBA Advanced Education offerings, including the benefits of attending Executive Banking School or conducting an OnSite program at your bank.

 

Welcome to the D.C. Area, JP Morgan Chase – This week, I attended a lunch with Jamie Dimon, CEO of JPMorgan Chase, and Thasunda Duckett, Chief Executive of Consumer Banking at Chase Bank. I am excited to welcome JP Morgan Chase to the Washington, D.C., area. With plans to add 700 employees, 70 branches and provide $4 billion in home and business loans to the region, this is great news for the local community. The bank will also pay their bank tellers an annual salary of $33,000 a year, along with full health benefits. 

 

 

THOUGHTS & PRAYERS

A Beautiful Life – I was privileged to meet Barbara Bush and George HW Bush back in 1991, way back when I was a district representative and driver for Congressman Jim McCrery. An experience I will forever cherish.

 

Wells Fargo’s Jennifer Riordan – Our thoughts and prayers are with Jennifer Riordan’s family, friends and the entire Wells Fargo team following the Southwest Airlines accident.  

 

 
 
LAGNIAPPE
 

Steven Antonakes – Steven was named executive vice president at Eastern Bank's Lynn, Massachusetts Market Street offices. He is a former CFPB deputy director and a member of CBA’s Government Relations Committee. 

 

Danni Lu Joins CBA’s 20-Year Club – A 20-year work anniversary is quite an accomplishment and I was excited to see the look on Danni Lu's face when we surprised her to celebrate this outstanding feat at CBA HQ this week. As our VP of Finance, she is passionate about her career and dedicated to her team. We are fortunate to have Danni as a member of the CBA family. She joins CBA’s Steve Zeisel, EVP & General Council, Melissa Cabocel, SVP of Education, and Joanna Beaver, VP of Committees and Events, as having served more than 20 years at CBA.

 

It was a family reunion at CBA World Headquarters this week as team members past and present gather to honor Vice President of Finance Danni Lu as she celebrated 20 years with CBA.