ABA Banking Journal
No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
SUBSCRIBE
ABA Banking Journal
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive
No Result
View All Result
No Result
View All Result
ADVERTISEMENT
Home Commercial Lending

Treasury Department Issues Sweeping Regulatory Reform Recommendations

June 12, 2017
Reading Time: 3 mins read

The Treasury Department tonight issued a 150-page report making dozens of recommendations for how Congress and regulatory agencies can streamline bank regulation in a way that promotes economic growth. The report came in response to President Trump’s executive order outlining core principles of financial regulation and calling for a comprehensive review of the regulatory structure.

As the American Bankers Association has long urged, the report called for significant tailoring of regulatory requirements. “[N]early seven years after [Dodd-Frank], regulation has proven to be insufficiently tailored to depository institutions based on the size and complexity of their business models,” the report said. The report noted that economic growth and loan growth have been historically depressed during the current recovery, which Treasury attributed in part to the volume and structure of current regulations.

“Today’s Treasury report is an important step to refine financial regulations to ensure that they are supporting — not inhibiting — economic expansion,” said ABA President and CEO Rob Nichols. “We applaud Secretary Steven Mnuchin for recognizing that we need regulatory reform to boost economic growth, and we expect this report will serve as a catalyst in that effort.” ABA was an active participant in the Treasury’s process. It submitted 10 white papers to Treasury offering detailed feedback, and delegations of bankers representing all bank sizes took part in in-person meetings. The recommendations of the report are consistent to a large degree with recommendations made by ABA.

To promote better tailoring, Treasury recommended raising the stress test asset threshold from $10 billion to $50 billion, while calibrating to allow some banks with over $50 billion in assets to be exempt as well, and substantially streamlining the stress test process. It also called for tailoring the participation thresholds for the more intensive capital and resolution planning processes known as CCAR and living wills, while simplifying them and making them less frequent, and better calibrating the Liquidity Coverage Ratio. “We remain steadfast in our belief that arbitrary asset thresholds should not guide regulation,” added Nichols. “Rather, regulators should be empowered to ensure that rules are tailored to different risk profiles and business models.”

The report also recommended simplifying the capital regime for community banks by exempting banks with less than $10 billion from Basel III and addressing problematic treatment of mortgage servicing assets and commercial real estate loans. The report called for all banks with less than $10 billion in assets to be exempt from the Volcker Rule, while offering additional recommendations to tailor and limit its compliance impact for all banks.

While some of Treasury’s recommendations require congressional action, Mnuchin estimated that “70 to 80 percent” can be put into motion by regulators immediately through their independent rulemaking authority. Among them: streamlining the FDIC de novo application process, easing appraisal requirements in rural areas, increasing the threshold for small creditor Qualified Mortgage loans, revisiting the volume and nature of supervisory Matters Requiring Attention, running the living will process on a two-year cycle, more clearly defining the Consumer Financial Protection Bureau’s UDAAP standard, making the CFPB “no-action” letter policy more useful, and revisiting the 2013 interagency leveraged lending guidance.

The report also highlighted numerous mortgage rules that the CFPB could address on its own, including aligning the QM standard with GSE eligibility requirements, eliminating underwriting requirements that deny mortgages to qualified borrowers, modifying the ability-to-repay calculation to help banks meet the needs of self-employed and non-traditional borrowers, clarifying ongoing problems with the TILA-RESPA integrated disclosures, improving flexibility in the loan originator compensation rule and delaying the Home Mortgage Disclosure Act data expansion.

Included in the recommendations for structural reform was a call for the CFPB director to be removable for cause or replaced by a bipartisan commission, as well as for the bureau to be subject to congressional appropriations. It also called for the CFPB complaint database to be accessible only to federal and state agencies and for the CFPB to lose its supervisory authority. Nichols will discuss the Treasury report, along with legislative efforts on regulatory reform and other topics during a free member webinar Thursday at 2 p.m. EDT. ABA staff will continue to review the report and issue additional analysis for members in the days to come.

ADVERTISEMENT
Tags: ABA Blueprint for GrowthAbility to repay and qualified mortgageAppraisalsBasel IIICFPB reformCommercial real estateConsumer complaintsCore principles for regulating the US financial systemGSEsHMDALeveraged lendingLiquidityLiving willsLoan originator compensationRegulatory burdenRegulatory capitalServicingSmall business lendingStress testsTailored regulationTILA-RESPA integrated disclosuresUDAAPVolcker Rule
ShareTweetPin

Related Posts

Fed Survey: Banks tighten policies on commercial real estate lending

ABA DataBank: Planned/announced office conversions spike

Commercial Lending
June 20, 2025

With low housing supply continuing to be a concern, planned conversions of office commercial real estate into residential units are starting to pick up.

Survey: Customers see little difference between mortgage lenders

OCC releases mortgage performance report for Q1 2025

Economy
June 20, 2025

The OCC released the first quarter 2025 mortgage metrics report, which showed that 97.6% of first-lien mortgages in the federal banking system were current and performing at the end of the quarter.

FBI: Crypto-related fraud losses increased 45% in 2023

Justice Department seizes millions of dollars linked to alleged crypto investment scams

Compliance and Risk
June 20, 2025

The Department of Justice announced it has seized $225.3 million in funds linked to cryptocurrency investment scams. The action marks the largest cryptocurrency seizure in Secret Service history.

ABA urges FinCEN to reevaluate BOI collection burden on banks

FinCEN releases figures on BSA filings

Compliance and Risk
June 20, 2025

Financial institutions filed 4.7 million suspicious activity reports in fiscal year 2024. They filed 20.5 million currency transaction reports during the same time frame.

FinCEN to propose new rules on money laundering, whistleblower program

Treasury official outlines principles for Bank Secrecy Act modernization

Compliance and Risk
June 18, 2025

The Treasury Department is exploring ways to streamline the filing process for suspicious activity reports and currency transaction reports as part of a broader effort to modernize BSA enforcement, Deputy Secretary of the Treasury Michael Faulkender said.

Podcast: Staying close to clients amid tariff-driven volatility

Podcast: Staying close to clients amid tariff-driven volatility

ABA Banking Journal Podcast
June 18, 2025

Amid tariff-related volatility, how are small and midsize businesses and the banks that serve them faring?

NEWSBYTES

ABA DataBank: Planned/announced office conversions spike

June 20, 2025

OCC releases mortgage performance report for Q1 2025

June 20, 2025

Justice Department seizes millions of dollars linked to alleged crypto investment scams

June 20, 2025

SPONSORED CONTENT

AI Compliance and Regulation: What Financial Institutions Need to Know

Unlocking Deposit Growth: How Financial Institutions Can Activate Data for Precision Cross-Sell

June 1, 2025
Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

Choosing the Right Account Opening Platform: 10 Key Considerations for Long-Term Success

April 25, 2025
Outsourcing: Getting to Go/No-Go

Outsourcing: Getting to Go/No-Go

April 5, 2025
Six Payments Trends Driving the Future of Transactions

Six Payments Trends Driving the Future of Transactions

March 15, 2025

PODCASTS

Podcast: Staying close to clients amid tariff-driven volatility

June 18, 2025

Podcast: Old National’s Jim Ryan on the things that really matter

June 12, 2025

Podcast: What bankers need to know about ‘First Amendment audits’

June 5, 2025
ADVERTISEMENT

American Bankers Association
1333 New Hampshire Ave NW
Washington, DC 20036
1-800-BANKERS (800-226-5377)
www.aba.com
About ABA
Privacy Policy
Contact ABA

ABA Banking Journal
About ABA Banking Journal
Media Kit
Advertising
Subscribe

© 2025 American Bankers Association. All rights reserved.

No Result
View All Result
  • Topics
    • Ag Banking
    • Commercial Lending
    • Community Banking
    • Compliance and Risk
    • Cybersecurity
    • Economy
    • Human Resources
    • Insurance
    • Legal
    • Mortgage
    • Mutual Funds
    • Payments
    • Policy
    • Retail and Marketing
    • Tax and Accounting
    • Technology
    • Wealth Management
  • Newsbytes
  • Podcasts
  • Magazine
    • Subscribe
    • Advertise
    • Magazine Archive
    • Newsletter Archive
    • Podcast Archive
    • Sponsored Content Archive

© 2025 American Bankers Association. All rights reserved.