The American Bankers Association and the Consumer Bankers Association this week expressed support for the Consumer Financial Protection Bureau’s recent announcement that it will increase nonbank supervision.
The Consumer Financial Protection Bureau today said it would invoke a “largely unused” authority under the Dodd-Frank Act to directly examine nonbank financial services providers. “Given the rapid growth of consumer offerings by nonbanks, the CFPB is now utilizing a dormant authority to hold nonbanks to the same standards that banks are held to,” said CFPB Director Rohit Chopra.
As the Federal Reserve continues to consider which entities may become eligible for access to its payments systems, ABA and a coalition of trade groups called for the Fed to clarify how it will address problems of institutions with novel charters—such as state-chartered non-depository banks and crypto firms—seeking access.
Innovation that puts the payment system at greater risk isn’t “disruption.” It’s an unforced error that the Fed can and should easily avoid.
Republican lawmakers ask the U.S. Postal Service to stop the extension of a financial services pilot program that they claim has violated statutory restrictions since its inception.
The American Bankers Association told the Department of Justice today that the 1995 bank merger competitive review guidelines are outdated and do not take into account the competitive effects of online banking and competition from nonbanks.
Members of the Federal Reserve’s Community Depository Institution Advisory Council flagged cybersecurity threats—particularly related to ransomware—as a top threat facing community banks during a recent meeting, and noted that “a framework needs to be put in place that encourages cooperation and reduces risks of transparency (which currently is seen as leading primarily to punishment and reputational damage).”
The nonbank financial intermediation sector grew less than banking in 2020, according to Financial Stability Board report.
Ahead of a House Financial Services Committee hearing on digital assets today—at which the heads of several cryptocurrency firms will testify—the American Bankers Association submitted a statement for the record emphasizing the need for bank-like regulations for companies offering digital assets to consumers.
In a letter to the CFPB today, the American Bankers Association and the Consumer Bankers Association emphasized the need for consistent consumer protection and a level playing field for payments products offered by banks and big tech firms.