One of the issues our housing market is facing is the new regulations that banks have been under. I have not touched on this subject very often because of my lack of understanding of all the new regulations being implemented on these banks. That probably shouldn’t stop me from digging into this topic because from what I have been hearing, many of these banks are having difficulty understanding these new regulations as well.
HousingWire has a good article that touches on these issues.
The leaders of community banks and credit unions warned the House Financial Services Committee Monday that aggressive federal regulations are hindering the institutions’ ability to lend money.
Patricia Wesenberg, president and CEO of Central City Credit Union in Marshfield, Wis., told the committee that while credit unions had no role in causing the financial crisis, they now “face what might be best described as a crisis of creeping complexity related to their regulatory burden.”
Wesenberg said it’s not one regulation that is weighing the credit unions down, but an influx of multiple new rules.
“The barrage of regulations creates an unnecessary burden without any measure of the effectiveness of these changes,” Wesenberg said. “They are costly, both in time and personnel to implement, and they are confusing to our membership. We would prefer to spend our resources on promoting our mission of financial literacy and the development of new products to serve the needs of our members within our local communities.”
Read Full Article
This is going to continue to be a problem as the Dodd-Frank Act continues to add new regulations to the banking industry making it difficult for these banks to know what the rules are and what the rules will be.
There is a great source for the regulations as they come out Daily from the St Louis Federal Reserve. You can subscribe to the RSS Feed to view these proposals and rules as they are implemented. You can also search back to the additions. ( I just added that RSS feed to the right hand column so we can watch it over time to get a sense of what this industry is going through.)
Here is a sample of the New Rules and Regulations from their website highlights:
|10/25/2011||CFTC – Proposed amendment extending expiration dates provided in final order on temporary exemption for swaps, swap dealers, major swap participants, eligible swap participants, and certain transactions in exempt commodities. (OPEN FOR COMMENT)|
|10/24/2011||SEC – Proposed rule providing for the registration of security-based swap entities. (OPEN FOR COMMENT)|
|10/18/2011||FRS – “Proposal clarifying Regulation J’s application to remittance transfers. (OPEN FOR COMMENT)|
|10/18/2011||FSOC – Second proposal regarding criteria, processes and procedures to require enhanced supervision of certain nonbank financial companies. (OPEN FOR COMMENT)|
|09/30/2011||TREAS – Ethics standards for Treasury employees. (OPEN FOR COMMENT)|
|09/28/2011||SEC – Prohibition against conflicts of interest in certain securitizations. (OPEN FOR COMMENT)|
|09/27/2011||TREAS – Proposal to replace references to credit ratings in the liquid capital rule. (OPEN FOR COMMENT)|
|09/20/2011||CFTC – Swap transaction compliance and implementation schedule for clearing and trade execution. (OPEN FOR COMMENT)|
|09/20/2011||CFTC – Swap transaction compliance and implementation schedule for trading documentation and margining requirements. (OPEN FOR COMMENT)|
|09/16/2011||IRS – Swap exclusion for Section 1256 contracts. (OPEN FOR COMMENT)|
- Credit unions, community banks face ‘creeping complexity’ of regulation (housingwire.com)
- Dodd Frank and the End of Free Checking (nebraskaenergyobserver.wordpress.com)
- Dodd on Dodd(-Frank) (pubcit.typepad.com)