The Washington Report For week ended January 26, 2018 | KPMG | US
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Washington Report 360 | January 26, 2018

The Washington Report For week ended January 26, 2018

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Key Highlights

  • Federal Reserve Vice Chairman for Supervision Randal Quarles outlined an approach to improving post-crisis bank regulations that includes retaining core reforms, continuing with outstanding proposals for improvement, such as simplifying capital rules and enhancing stress tests, and introducing more tailored supervision and regulation. (See KPMG Regulatory Alert)
  • The Senate confirmed the nomination of Jerome Powell as Chairman of the Federal Reserve.
  • The OCC published its Semiannual Risk Perspective for Fall 2017, which reported cybersecurity threats, concentrations in third-party service providers, and anti-money laundering compliance among the key risks in the federal banking system.
     

Financial services policy news

Fed Vice Chairman for Supervision Randal Quarles outlined his initial plans to improve the effectiveness of post-crisis bank regulations, indicating that a leverage ratio proposal is due out soon, changes to the Volcker Rule will take time, and new work will focus first on further tailoring of regulations.

The Senate confirmed Jerome Powell as Chairman of the Federal Reserve for a four-year term to succeed Janet Yellen when her term ends on February 3, 2018.

News reports indicate that the Federal Reserve is rewriting the leverage-ratio capital requirement in response to the Basel IV leverage-ratio agreed to in December.

The U.S. Department of Justice and MetLife filed a motion to dismiss an FSOC appeal of a case that released the company from designation as a nonbank SIFI.

CFPB Acting Director Mick Mulvaney published an op-ed in the Wall Street Journal explaining his plan for the CFPB, including a focus on quantifiable harm, a more formal rulemaking process, and prioritization of effort supported by data analysis.

The CFPB published a request for information for public comment about its Civil Investigative Demand (CID) procedures, including processes for initiating investigations and issuing CIDs, as well as the timeframes associated with each step in the CID process.

 

Financial services legislative and regulatory news

The OCC published its Semiannual Risk Perspective for Fall 2017, which reported cybersecurity threats, concentrations in third-party service providers, and anti-money laundering compliance among the key risks in the federal banking system.

The CFTC and SEC issued a joint statement in which they said they will combat fraud perpetrated through digital instruments.

The Federal Reserve, FDIC, and OCC published interagency guidance for supervised institutions on the accounting implications of the Tax Cuts and Jobs Act of 2017.

The CFPB finalized changes to the Prepaid Accounts Rule, adjusting requirements for error resolution on unregistered accounts, providing more flexibility for credit cards linked to digital wallets, and extending the effective date of the rule by one year to April 2019.

The House passed the Home Mortgage Disclosure Adjustment Act, which would exempt from the relevant HMDA reporting rules lenders that originated fewer than 500 closed-end mortgage loans or fewer than 500 open-end lines of credit in each of the preceding two years.

The Senate Banking Committee held hearings on the nominations of Jelena McWilliams to be FDIC chair, Marvin Goodfriend to serve as Federal Reserve Board governor, and Thomas E. Workman to serve as the independent insurance industry member of the FSOC.

 

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