View from CBA May 17, 2013

May 17, 2013

CFPB Radar

The United States Senate is likely to debate CFPB Director Cordray's confirmation next week, with an actual vote following the Memorial Day recess.

While Director Cordray will not receive the votes necessary for confirmation, I believe Majority Leader Reid may be using this vote for a filibuster "reform" effort. Instead of needing 60 votes, Reid's proposal would require only 51 votes to proceed, which would quickly eliminate the Minority party’s ability to stop erroneous legislative actions. This would have a dramatic effect on all nominees pending in the Senate and many issues concerning the banking industry including: Cordray’s nomination, credit card interchange, card check, and a whole host of issues.

CBA will file a comment letter with the CFPB next week supporting the delay in the June 1, 2013 effective date of mortgage loan originator rule provisions, which ban financing of credit insurance premiums by way of a lump sum that is added to the loan at closing. We anticipate the CFPB will move forward and quickly finalize this delay.

We also expect the CFPB will finalize the earlier QM proposal on the points and fees test in the next week or two.

Airline Fees: Food for Thought

Just last month, United Airlines - based in Sen. Dick Durbin's home state - announced an increase in flight change fees from $150 to $200. Several other airlines followed suit. The LA Times ran an interesting story this week about the after-effects of the fee hikes:

"Passengers are learning to accept airline bag fees, survey finds: "Charging for bags still has a pronounced negative impact on passenger satisfaction, but with each year, passengers are increasingly more accepting of carriers unbundling baggage and other fees," said Ramez Faza, a senior manager at J.D. Power & Associates."

Graduate School of Retail Bank Management

I am pleased to announce this year's CBA/BAI retail banking school (GSRBM) enrollment has increased significantly over any time since the economic downturn. Students from dozens of banks have submitted applications and we look forward to announcing the freshman class next week. Visit our website to learn more about the school.

Comerica Visit

This week, I flew to Dallas to visit CBA's newest Board Member, Dana Drago, Executive Vice President, National Retail Banking of Comerica Bank. I also had the opportunity to meet with CBA Government Relations Council member Mike Aust, Executive Vice President, National Retail Administration and CBA Gov Reps member Dan Donohoe, Senior Vice President, Director of Government Relations. We discussed Comerica's positioning in the industry and the future of retail banking.

Gov Reps Lunch

CBA's Government Relations team hosted 21 government representatives from our member banks at a lunch Wednesday to discuss pressing policy issues facing the industry. The event featured remarks from two senior members of Senate leadership who provided a general sense of the Senate's priorities and calendar, including upcoming appointee confirmation votes, tax reform prospects and immigration reform. The speakers provided great insight on how the current political environment will impact several key issues.

Ed Funding Fly-In

We are excited to welcome our Education Funding Committee to CBA world headquarters in Washington next week.