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Wednesday, November 25, 2015

Fed Proposes New Rule on Liquidity Reporting

The Federal Reserve proposed a rule specifying how large banking organizations must make quarterly public disclosures of their liquidity coverage ratios.

Under the proposed rule, institutions subject to the LCR would be required to disclose their consolidated LCR calculations, based on averages over the prior quarter. Banking organizations would be required to post them prominently on their websites. In addition to disclosing the amount of high-quality liquid assets, the rule would require banking organizations to disclose information about their projected net cash outflow, including inflows and outflows from retail and derivatives. Companies would also be required to provide a discussion of their LCR results, factors behind them and significant changes.

The proposed compliance date for the disclosures is July 1, 2016 for larger institutions and July 1, 2017 for all others. Comments on the proposed rule are due by Feb. 2, 2016.

Read the proposal.

Tuesday, November 24, 2015

CFPB Releases Monthly Complaint Snapshot on Bank Accounts

This month’s CFPB complaint snapshot spotlighted bank account and service complaints. The report took an in-depth look at Connecticut and the Hartford metro area. Consumers’ most frequent bank account or service complaints were about account management. Specifically, consumers complained about being unable to open an account or an account being closed without explanation. Some consumers also struggled to resolve transaction disputes and reported issues with depositing and withdrawing funds.

According to the report, more than 200 million Americans have open deposit accounts. The CFPB has handled approximately 75,300 bank account or service complaints since March 1, 2012, representing about 10% of total complaints.

Read more.

CFPB Planning National Survey on ‘Financial Well-Being’

The CFPB is seeking regulatory approval for a national survey of consumer “financial well-being,” according to a filing in the Federal Register. The proposed survey of 6,000 adults would record how Americans rate their financial well-being; probe what kinds of knowledge, behavior and skills support well-being; and produce “fully de-identified” data that would be open for further research.

In a report issued in January, the CFPB outlined four factors that constitute financial well-being: control over finances, ability to absorb a financial shock, being on track to meet financial goals and financial freedom that allows one “to enjoy life.” The bureau is using the concept to define the end goal of a financial education program.

Read more.

CFPB Clarifies Requirements for Preauthorized EFTs

The CFPB today issued a bulletin clarifying the obligations of entities obtaining customer authorization for preauthorized electronic funds transfers. To be compliant, all EFTs must be authorized by the customer in writing — in either paper or electronic form, as specified by the E-Sign Act — and the customer must be provided with a copy of the authorization terms that includes the timing and amount of the recurring transfers.

The bulletin — issued after the CFPB observed that “some entities may not fully comply” with Regulation E requirements on EFT authorizations — also stated that authorization can be given over the phone if the customer provides authentication by using a code or PIN entered on the phone’s keypad, or if the oral authorization is recorded and retained by the requesting company and follows the requirements of the E-Sign Act.

Read the bulletin.

Study: Swaps, CEO Pay, HMDA Rules Costliest Financial Regs of 2015

New regulations finalized in 2015 will cost the financial services industry $9.4 billion and consume 14 million hours of paperwork, according to a new analysis by the American Action Forum.

Most costly of the 16 final rules included in the analysis is the interagency rule on margin and capital requirements for covered swap entities at $5.2 billion, followed by the SEC’s requirement to disclose the ratio of CEO pay to median employee pay at $1.8 billion and the CFPB’s expanded HMDA data collection at $1.3 billion.

Read the analysis.

Monday, November 23, 2015

CFPB Updated Rule Making Agenda for 2015-16

The CFPB updated its rule making agenda for the remainder of 2015 and into 2016. According to the agenda, the bureau expects to issue final rules on consumer protections for prepaid cards in the spring of 2016 and on mortgage servicing by mid-2016. The agenda also indicates that a proposed rule to address lending and collection practices for payday, auto title and similar lending products could come in the first quarter of 2016.

The CFPB also said it is continuing with its early-stage rule making on arbitration and conducting further research on overdrafts, debt collection and lending to small and women- and minority-owned businesses.

Read more.