The company and its global peers have seen their profitability hurt by half a decade of negative interest rates, which effectively make banks pay for holding clients’ cash.
Several community banks are warning Congress that their participation in the Paycheck Protection Program could cause them to cross a threshold that may lead to, among other things, supervision by the CFPB and a cap on interchange fees.
The mortgage giants will have to meet benchmarks for covering cash flow needs during stressed periods. The FHFA views the requirements as a prerequisite to the companies exiting conservatorship.
Congress and the FDIC are considering easing limits on banks' holdings of such deposits, a move that could inadvertently lead to more expensive failures.
At a congressional hearing, Fed Chairman Jerome Powell discussed steps to get the flow of coins to financial institutions back to pre-pandemic levels, as well as ways to ease other industry burdens.
Members of both parties raised concerns that the requirements for participating in the Municipal Liquidity Facility and Main Street Lending Program are too restrictive to benefit smaller localities and certain midsize firms.
Many lenders are paying close attention to liquidity and capital ratios. Others are trying to avoid overtaxing employees who process, service and handle forgiveness of the loans.
Members of the Banking Committee pressed the Treasury secretary and Fed chief to ensure CARES Act funds are deployed as Congress intended. They also debated the need for more stimulus to ease the economic effects of the coronavirus.
