Banking Law Prof Blog

Reg Relief Meets Reg O - Final Rule

The Federal Reserve Board has published the Final Rule amending Regulation O to reflect the elimination of certain reporting requirements for loans to insiders.  These amendments DO NOT change the substantive limitations on loans to insiders -- just the paperwork.

Link:  http://www.federalreserve.gov/boarddocs/press/bcreg/2007/200705292/default.htm

(ag) May 30, 2007

Reg O Revisions

The Federal Reserve has adopted an Interim Rule, eliminating some Regulation O (loans to insiders) reporting requirements.  The Interim Rule is effective immediately upon Federal Register Publication -- but FRB seek comments for 30 days.  This Interim Rule does not change substantive Reg O requirements, but merely fulfills the statutory mandate of the Reg Relief Act to reduce regulatory burden on banks.

Link to Dec. 6, 2006, Press Release:  http://www.federalreserve.gov/BoardDocs/press/bcreg/2006/200612062/default.htm

(ag) Dec. 8, 2006, in FRB/Lending Issues/Reg Relief

Reg Relief & CRA - Understanding the New Higher Public Welfare Investment Limit

One result of the Financial Services Regulatory Relief Act of 2006 is to increase the Public Welfare Investment ceiling from 10% to 15% of a bank's capital & unimpaired surplus.  Anything over 5% will still require approval from the primary federal regulator based on a determination that the additional investment will not pose a risk to the deposit insurance fund and that the bank is not undercapitalized. 

Link to OCC's Oct. 23, 2006, Bulletin:  http://www.occ.treas.gov/ftp/bulletin/2006-44.html

(ag) Oct. 23, 2006, in CRA/Reg Relief

Fed Chairman Decries Regulatory Burden, Discusses BSA, CRA, Capital Standards (Basel II) and the Reg Relief Act

In remarks delivered Oct. 16, 2006, before the Annual Conventions of the American Bankers Association (in Phoenix) and America's Community Bankers (San Diego, via satellite), Ben S. Bernanke, the relatively new Chairman of the Board of Governors of the Federal Reserve System, looked at bank regulation through an economist's lens:  cost benefit analysis.  That's good new for bankers.  He appears to be a proponent of reducing regulatory burden. 

Bernanke talked specifically about three key areas bankers often complain about:  BSA, CRA, and Capital Standards.  He also highlighted the following provisions of the Regulatory Relief Act:  authority for the Fed to pay interest on sterile reserves and discretion to lower the reserve ratio (although unfortunately, not effective until 2011); authority for the Fed to pay interest on voluntary deposits with the Fed, including contractual clearing balances and excess reserve balances;  immediately raising the asset ceiling from $250M to $500M for banks that can qualify to extend the exam cycle from 12 months to 18 months if they are well-capitalized and well-managed; and the requirement for the Fed and the SEC to issue joint regulations regarding "broker" exceptions for banks under GLBA.

Link to Speech:  http://www.federalreserve.gov/boarddocs/speeches/2006/20061016/default.htm

(ag) Oct. 17, 2006, in Federal Banking Agencies - FRB, Regulatory Relied, BSA, CRA, Capital Requirements (Basel II)

President Signs Reg Relief Bill

  On Friday, Oct. 13, 2006, President Bush signed the Financial Services Regulatory Relief Bill.  Some key provisions include:

*  Giving State Bank Regulators a vote on the FFIEC;

*  Extending the scheduled exam interval from 12 to 18 months for well-managed, well-capitalized banks with less than $500M in assets;

*  Recognizing nationwide cooperative agreements for interstate supervision of multi-state banks and prohibiting host states from charging out-of-state branches of state-chartered banks a fee, except by cooperative agreement.

The Reg Relief bill (S.2856) passed the House on Sept. 27 under suspension of the rules by a unanimous vote and was approved by unanimous consent of the Senate on Sept. 30.

Link to full text of Reg Relief Bill:  http://financialservices.house.gov/media/pdf/09-27-06%20S2856_SUS.pdf

(ag) Oct. 14, 2006, in Reg Relief

Reg Relief - Not Everything Banks Wanted, Better than Nothing?

Banking lawyers and trade associations are calling the Financial Services Regulatory Relief Act of 2006 "disappointing".

Link to enrolled bill:  http://thomas.loc.gov/cgi-bin/query/D?c109:1:./temp/~c109dlrgN8::

Here's the American Bankers Association's short statement on the bill's passage:

http://www.aba.com/Press+Room/092806RegulatoryReliefPassage.htm

Here's a Bill Summary from the Independent Community Bankers of America's website:

http://www.icba.org/files/ICBASites/PDFs/regreliefsummary.pdf

(ag) October 6, 2006, in Reg Relief/Congress

House Unanimously Passes Reg Relief!

On Sept. 27, the U.S. House of Representatives unanimously passed the Financial Services Regulatory Relief Act of 2006.  The bill now goes to the Senate.

Link to Press Release from the House Committee on Financial Services:  http://financialservices.house.gov/news.asp?FormMode=release&id=871&NewsType=1

(ag) Sept. 28, 2006, in Reg Relief/Congress

News Flash!!! Regulatory Relief Could Pass Today!

The word just out from CSBS is that Congress could pass the Reg Relief Bill today. 

Link to CSBS e-mail news: 

Download regulatory_relief_update.doc

(ag) Sept. 27, 2006, in Reg Relief