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View from CBA June 21, 2013
Following CBA's Board meeting with CFPB Director Cordray last week, we are working with Bureau staff to continue our dialogue on QM issues. The CFPB’s mortgage implementation team will continue to issue clarifications and resolve questions as lenders work to implement the new rules by the January 10 effective date.
Director Cordray delivered remarks to the Exchequer Club on Wednesday. When asked in the Q&A about the Bureau potentially banning products, Cordray did not say no - he said it would be on a case-by-case basis. Back at CBA LIVE 2012, I asked him if he had seen a product he think should be banned or that was likely to be banned. His response:
"I don’t think that that’s the way Congress or the Bureau thinks about or talks about the issues in front of us. The statue never talks about banning any product. It talks about acting against unlawful acts or practices... But we’re not there to sort of design or oversee the innovations in the financial sector."
From American Banker "Mortgage-Rule Concerns Overblown, Cordray says"
"I think there has been more hubbub around these requirements than is perhaps justified," said Cordray, adding that "anxiety" over the rule won't stop lenders from making non-QM loans. For a lender "to not make those mortgages and leave that money on the table and leave people un-served because of some vague fear that they can't quite articulate; that doesn't sound to me like the kind of good decision-making that lenders have made for years."
U.S. Senator Mike Enzi, (R-WY) had some comments on the CFPB and data collection this week:
"Enzi said the Consumer Financial Protection Bureau is collecting data on as many as 10 million Americans from banking to mortgage loan information... 'Congress has less control over this agency than the National Security Agency ...The NSA claims it is protecting you from terrorists. The consumer protection bureau claims it’s protecting you from banks. At what point does 'protection' become power or control?'"
In the news, instructions to CFPB employees from their Freedom of Information Act office are raising concerns about government accountability and transparency:
“Keep your calendar entries brief and general. If possible, avoid annotating entries with agendas, detail discussions, etc. ... Minimize attachments to your calendar appointments. Consider using email to send related attachments.”
Also announced this week, a CFPB partnership with Boston to help local consumers with questions and complaints. This is a great example of putting America's consumers first and finding new ways to connect with them.
Up next week: On Monday at 10 a.m. we expect to have an answer on whether the Supreme Court will take the Noel Canning case. This will have big implications for Director Cordray since he was appointed CFPB Director with the same “recess” authority being challenged in the Canning case.
CBA's Liz Terry and I traveled to Orange County, CA this week to visit with members at California Bank & Trust. We had a great conversation with Ash Abdelaaty, Senior VP, Business Banking Regional Manager and Rocky Bandzeladze, SVP, Strategy Manager, Business & Personal Banking Division.
We also visited associate member CoreLogic and met with George Livermore, Group Executive, Global Sales and Client Services and Terry Theologides, SVP, General Counsel and Secretary. We look forward to continuing and increasing our relationship with CoreLogic.
While in California, Liz Terry went to San Diego to visit with U.S. Bank’s Erica Opstad, Vice President & Manager, Office of Corporate Citizenship & Financial Education, Community Affairs Division, to debrief on the Banking On Youth Pitch Off, which was sponsored by U.S. Bank.
CBA Speaking Appearances
CBA's Jeff Bloch spoke at the “Conference on Dodd Frank and the Future of Finance,” through the Center for Financial Education, Mendoza College of Business, University of Notre Dame. Attendees included 80 academics/researchers, government regulators, and industry practitioners. Jeff participated in a panel discussion on the CFPB, speaking about the banking industry’s concerns regarding the Bureau's structure, exam process, and issues in the news.
At In-Bank Training: Banking Basics in Atlanta, CBA's Dong Hong addressed 35 members of the Equifax team, providing background on CBA and the CFPB, along with insight and analysis on housing reform, fair lending, uneven regulatory treatment of different lending institutions and recent Bureau studies on DAP and overdraft.