The rules to comply with the Community Reinvestment Act have become "formulaic and ossified" and must be changed to encourage lending practices the law originally intended to foster, the Fed's top regulator said.
The Office of the Comptroller of the Currency has been leading the charge on revamping the Community Reinvestment Act, but a big unknown is whether the other two regulators charged with carrying out the law are committed to moving ahead as swiftly on a reform plan.
Bank regulators have not even proposed a plan yet for revamping the Community Reinvestment Act, but stakeholders likely to weigh in on the plan are already establishing battle lines.
In addition to his highly publicized comments on trade and other political issues, the CEO of JPMorgan Chase used his annual letter to underscore the importance of job training for low-wage workers and call attention to an FDIC proposal that encourages banks to hire workers who have been convicted of minor crimes.
As part of a larger regulatory relief effort, regulators have raised the dollar-amount threshold for commercial real estate transactions that require a formal appraisal.
Policies to shore up banks’ corporate cultures have remained a low priority even though some regulators want to attack the issue head on. Strengthening a firm’s ethical values may best be left to a bank’s internal brass.
The agency said Cross River Bank and an affiliated debt settlement company misled customers into thinking a debt consolidation program would settle their debts and boost their creditworthiness.
In his last major speech as the agency’s No. 2, Thomas Hoenig said it would be a “serious policy mistake” to relax measures such as the supplementary leverage ratio, but he was more open to regulatory relief in other areas.
