Tabs

Bank/Thrift Supervision   |    Capital    |    CFPB    |    Deposit Insurance    |    Interchange    |    Mortgage Finance
Municipal Advisors   |    OCC-OTS Merger   |    Preemption    |    QM - QRM    |    Swaps   |    Volcker Rule    |    Full Topics List
 
Qualified Mortgage - Qualified Residential Mortgage
Swaps
Consumer Financial Protection Bureau - CFPB
Bank/Thrift Holding Company Supervision
Capital
Deposit Insurance
Interchange
Mortgage Finance
Municipal Advisors
OCC-OTS Merger
Preemption
Volcker Rule
Corporate Governance
Financial Stability Oversight Council (FSOC)
Appraisals
Office of Financial Research (OFR)
Systemic Risk
Supervision and Oversight
Payment, Clearing and Settlement
Prudential Supervision
Trust & Securities
Asset-Backed Securities
Resolution Authority

Friday, November 18, 2016

Nichols to Regulators: Time to Revisit Asset Thresholds

In a letter to the heads of the federal banking agencies, ABA President and CEO Rob Nichols said it was time for regulators to revisit the numerous asset thresholds at which different regulatory frameworks begin to apply. Several years after these thresholds have been implemented, Nichols said regulators should consider whether the thresholds are meeting their supervisory purposes or “unintentionally limiting economic growth,” which is not an academic question given the persistently low-growth environment in developed economies.

Nichols noted that “rudimentary” asset-size thresholds were earlier adopted out of a spirit of tailored supervision – a spirit that should encourage more sophisticated tailoring. He said:
Reflection and experience tell us that asset size has a poor correlation with prudential risk. We believe an appropriate alternative approach would be to replace the thresholds with a more risk-sensitive, dynamic measure that would better align regulatory requirements with risk.

Read more.

No comments:

Post a Comment

Please read our comment policy before making a comment.