Source: http://www.canfieldpress.com/roadmap/dodd-frank/
Timestamp: 2017-11-22 16:27:45
Document Index: 549557526

Matched Legal Cases: ['§ 1024', '§ 5', '§ 716', '§ 1026', '§ 1017', '§ 23', '§ 23', '§ 610', '§ 716', '§ 1603', '§ 1306', '§ 120', '§ 610', '§ 716', '§ 728', '§ 716', '§ 728', '§ 210', '§ 203', '§ 210', '§ 203', '§ 911', '§764']

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Dodd-Frank Roadmap Update
The CFTC issued a final rule and interim final rule establishing initial and variation margin requirements.
The Federal Reserve issued a final rule establishing policies and procedures with respect to emergency lending under Federal Reserve Act section 13(3).
The SEC proposed a rule on disclosure of payments by resource extraction issuers.
Dodd-Frank Roadmap (11-02-15)
The Federal Reserve proposed a rule to require global systemically important banks (GSIBs) to hold sufficient amounts of long-term debt that is convertible to equity during a bank’s resolution, to provide private capital to support the firms' critical operations during resolution. The proposal would also require the banks to meet a total loss-absorbing capacity (TLAC) that can be met with both regulatory capital and long-term debt. Domestic GSIBs would be required to hold at a minimum:
The proposal also would require the parent holding company of a domestic GSIB to avoid issuing short-term debt to external investors and entering into derivatives and certain other financial contracts with external counterparties.
Dodd-Frank Roadmap (10-22-15)
This is an updated Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports.
The federal banking agencies, Farm Credit Administration, and FHFA adopted joint final rules to establish initial and variation margin requirements and capital requirements for non-cleared swaps, applicable to registered swap dealers, major swap participants, security-based swap dealers, and major security-based swap participants that these agencies regulate.
The CFPB finalized a HMDA regulation specifying several new data items lenders will be required to report about mortgage loans. The rule does not specify how much of the information will be public. The CFPB will accept public input on the privacy issues at a future time.
The CFTC supplemented an earlier proposed regulation to modify its aggregation rules for position limits, addressing aggregation for futures and option contracts on nine agricultural commodities, to address when aggregation is required based on ownership of more than half of another entity.
The FDIC proposed a surcharge on the quarterly assessments of insured institutions with consolidated assets over $10 billion when the deposit insurance fund’s reserve ratio is between 1.15 and 1.35 percent.
Dodd-Frank Act Rulemakings, Studies, and Reports Update
Attached please find an updated Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports.
The CFPB announced it released a Settlement Cost Booklet in Spanish.
The CFPB finalized an amendment to its definitions of small creditor and rural and underserved areas, for purposes of exemptions from mortgage rules.
The CFTC proposed to amend its definition of “material terms” for purposes of swap portfolio reconciliation.
The SEC finalized a rule to remove credit rating references from its rule 2a-7, the principal rule that governs money market funds.
The CFTC proposed clarifying amendments to its rules on swap data recordkeeping and reporting requirements for cleared swaps.
The SEC proposed a rule requiring security-based swap data repositories to make data available to certain regulators and other authorities, and would set forth a conditional exemption from the statutory indemnification requirement associated with that regulatory access provision.
The SEC released its final pay ratio disclosure rule.
The SEC proposed a rule by which a security-based swap entity can apply to the SEC for an order permitting an associated person who is subject to a statutory disqualification to effect or be involved in effecting security-based swaps on behalf of the entity.
The CFPB released its policy for publishing consumer complaint narratives and proposes to publish complements.
The CFPB solicits comment on the credit card market.
The CFTC reopened for public comment the cost benefit analyses of eight regulations in response to a judicial challenge, SIFMA et al. v. CFTC, 13-1916 (D.D.C. Sept. 14, 2014). The rules are: real-time reporting; SDR reporting; swap entity registration rule; daily trading records, risk management, and chief compliance officer rules; entity definition rule; historical SDR reporting rule; portfolio reconciliation rule; and swap entity registration.
The CFTC published a rule to remove the December 31, 2018 automatic termination date for the phased-in compliance schedule for futures commission merchants and to provide assurance that the residual interest deadline will only be revised through a separate rulemaking.
The SEC proposes a rule to require issuers to disclose in any proxy or consent solicitation material for an annual meeting whether any employee or board member is permitted to hedge or offset any decrease in the market value of equity securities either granted to the person as compensation or held by the employee or director.
The SEC proposed a regulation to require a national securities exchange or security-based swap execution facility to report to a registered security-based swap data repository (SDR) a security-based swap executed on the platform that will be submitted to clearing and to require a registered clearing agency to report to a registered SDR any security-based swap to which it is a counterparty.
The SEC finalized two new rules to require security-based swap data repositories to register with the SEC and prescribe reporting and public dissemination requirements for security-based swap transaction data. The SEC also proposed certain additional rules, rule amendments and guidance related to the reporting and public dissemination of security-based swap transaction data. Regulation SBSR and SDR registration.
The CFPB proposed amendments to Regulations E and Z regarding prepaid financial products to require disclosures, apply limited liability and error resolution procedures, and to protect consumers from unauthorized transfers. It would apply to prepaid cards but not gift cards.
The CFTC reopened the comment periods for an aggregation proposal and a position limits proposal both released in 2013, until January 22, 2015.
Treasury proposed regulations to require qualified financial contract recordkeeping with respect to positions, counterparties, legal documentation, and collateral. The Dodd-Frank Act provides that if the federal primary financial regulatory agencies do not prescribe such regulations to assist the FDIC as receiver to exercise its rights and fulfill its obligations within 24 months of enactment, which they did not, the FSOC Chairperson must.
The Federal Insurance Office released a report entitled The Breadth and Scope of the Global Reinsurance Market and the Critical Role Such Market Plays in Supporting Insurance in the United States. The report states that a substantial portion of reinsurance supporting the U.S. insurance sector is provided by companies not licensed in all states and, in many cases, neither domiciled nor licensed in the U.S. It states that non-U.S. reinsurers accepting reinsurance premium ceded from U.S. insurers are not subject to the same state supervision applicable to licensed or accredited U.S. insurers and reinsurers. Such reinsurers are indirectly regulated by state laws requiring that, to obtain “credit for reinsurance,” the non-U.S. reinsurer must post collateral for reinsurance liabilities, but state law is varied. Treasury and the U.S. Trade Representative are considering an agreement with respect to collateral requirements for reinsurers and preemption of state laws.
FSOC designated MetLife as systemically important, subjecting it to Federal Reserve supervision and enhanced prudential standards. The vote was nine to one, and the dissenting view is here.
FSOC solicits comment on whether asset management products and activities, of any entities or investment vehicles, may pose risks to the U.S. financial system in the areas of liquidity and redemptions, leverage, operational functions, and resolution, or in other areas.
The FDIC released guidance for resolution plans for banks and thrifts with assets greater than $50 billion. Under the guidance, a covered institution must provide a fully developed discussion and analysis of a range of realistic resolution strategies, with at least one strategy that primarily involves the separation and sale of the institution's deposit franchise, core business lines, and/or major assets to multiple acquirers. It should also include a second strategy that involves the liquidation of the firm, including a payout of insured deposits.
The Federal Reserve announced that it extended the compliance date for the Volcker rule with respect to legacy covered funds, meaning covered funds and foreign funds that were in place prior to December 31, 2013. Banking entities have until July 21, 2016, to conform investments in and relationships with legacy covered funds. Next year, the Board it will grant an additional one-year extension of the conformance period until July 21, 2017.
Compliance was originally to be required July 21, 2014. The Dodd-Frank Act permits the Federal Reserve to extend the deadline one year at a time up to three years, and in December 2013 when the agencies adopted the rule, the Board extended the date until July 21, 2015. In April 2014, the Board stated that it intended to grant two one-year extensions of the conformance period with respect to ownership interests in and sponsorship activities of CLOs backed in part by non-loan assets and that were in place as of December 31, 2013. The Board now extends the conformance period for other types of legacy covered funds.
All investments and relationships in a covered fund made after December 31, 2013, must be in conformance by July 21, 2015. This extension would not apply to proprietary trading activities, and banking entities must conform proprietary trading activities to the final rule by July 21, 2015.
GAO released a report on Dodd-Frank regulations, entitled Regulators’ Analytical and Coordination Efforts. The report states that GAO focused particularly on coordination efforts involving the Volcker rule and rules related to regulation of the swaps market. For the Volcker rule, interagency coordination led regulators to adopt a common rule and regulators voluntarily have continued coordination efforts during rule implementation. For swaps rulemakings, regulators coordinated domestically and internationally but this did not always result in harmonized rules, and key differences among some rules have raised compliance and market efficiency concerns among market participants, industry associations, and foreign regulators with whom GAO spoke.
The Comptroller finalized a rule that adjusts the timing of its annual stress testing cycle by three months and that clarifies how the agency calculates regulatory capital in the stress tests.
The Federal Reserve proposed a capital regulation to identify whether a U.S. bank holding company is a global systemically important banking organization (“GSIB”). A GSIB would be subject to a risk-based capital surcharge based on its systemic risk profile. Eight U.S. firms would currently be GSIBs: Bank of America Corporation, The Bank of New York Mellon Corporation, Citigroup Inc., The Goldman Sachs Group, Inc., JPMorgan Chase & Co., Morgan Stanley, State Street Corporation, and Wells Fargo & Company.
The first method would consider the GSIB's size, interconnectedness, cross-jurisdictional activity, substitutability, and complexity, consistent with a methodology developed by the Basel Committee. The second method would replace substitutability with use of short-term wholesale funding, and would generally result in significantly higher surcharges than the BCBS framework. Under the proposal, estimated surcharges for bank holding companies that are GSIBs currently would range from 1.0 to 4.5 percent of total risk-weighted assets.
Dodd-Frank Act Rulemakings, Studies, and Reports
The Federal Insurance Office released its second annual report on the insurance industry, discussing consumer protection and access to insurance, including affordability of personal auto insurance; portability of auto insurance for servicemembers; force-placed insurance for homeowners; and topics concerning life insurance and annuities. The Report also addresses a range of regulatory developments over the past year.
The NCUA repealed its regulations governing unfair or deceptive acts or practices because the Dodd-Frank Act repealed the agency’s rulemaking authority under the FTC Act. The NCUA noted it still has supervisory and enforcement authority regarding unfair or deceptive acts or practices, as violations of the Dodd-Frank Act or FTC Act, which could include the practices previously addressed in its repealed rule.
Roadmap to Dodd-Frank Act Amendments Update
The President signed the Examination and Supervisory Privilege Parity Act, amending the Dodd Frank Act. This law does two things:
1) It amends Dodd Frank § 1024 (CFPB supervision of nondepositories) to require the CFPB to coordinate its supervisory activities with state agencies that license, supervise, or examine those who offer consumer financial products or services. Before this amendment, the CFPB was only required to coordinate with prudential regulators and state banking regulators.
2) It provides that when someone shares information with all those same state regulators, or with prudential regulators and state banking regulators, that sharing does not waive privileges. This covers information a financial services provider provides to a regulator, or that one regulator shares with another regulator. Typically, if information is subject to the attorney-client privilege, and it goes to anyone other than the attorney or client, the privilege is waived as to all persons. As a result, financial services providers may be reluctant to provide information to regulators. Regulators also assert supervisory privilege over information they obtain, and can be reluctant to share the information with each other, for fear of waiving their privileges.
This amendment is limited to nondepositories because Congress earlier enacted an analogous protection for depositories, by amending the Federal Deposit Insurance Act. That was Public Law No. 112-215, enacted December 20, 2012.
The CFPB issued a final rule defining a larger participants in the remittance transfers market. The rule defines a nonbank covered person as a larger participant if it has at least one million aggregate annual international money transfers.
The CFPB proposed a rule to define larger participants of a market for automobile financing. The rule would define the market to include auto purchase loans, refinances of such loans, leases, and purchases or acquisitions of these loans or leases. The rule would define certain automobile leases as a “financial product or service” over which the CFPB would have regulatory authority. The rule would define a nonbank covered person that engages in automobile financing as a larger participant of this market if the person has at least 10,000 aggregate annual originations, and is not predominantly engaged in the sale and servicing of motor vehicles, the leasing and servicing of motor vehicles, or both.
The CFPB extended a temporary provision that permits insured institutions to estimate certain remittance transfer pricing disclosures by five years from July 21, 2015, to July 21, 2020.
The CFTC proposed a rule to address margin requirements for uncleared swaps entered into by swap dealers or major swap participants. The rule would not apply to those regulate by a prudential regulator. The rule would impose margin requirements on trades between a covered swap entity and a swap dealer or major swap participant, and trades between a covered swap entity and financial end users. There would not be a margin requirement on commercial end users. The rule would permit $65 million threshold below which margin need not be collected.
The CFTC finalized a rule that amends the definition of the term “swap dealer” to permit a person to exclude certain types of swaps entered into with special entities that are utilities from the $25 million special entity de minimis threshold above which a person dealing in such swaps must register as a swap dealer.
~~Attached please find an updated Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports.
• The SEC proposed a rule to provide that certain communications involving security-based swaps, that only eligible contract participants may purchase, will not be deemed to be offers, or guarantees of the swaps that are securities. Under the proposed rule, publishing price quotes relating to such swaps, traded on an eligible platform, would not be an offer for purposes of § 5 of the Securities Act. Market participants would still need to determine whether a registration exemption under the Securities Act is available.
The banking agencies, FHFA, and the Farm Credit Administration reproposed a rule that would establish margin requirements for swap dealers and major swap participants. Initial and variation margin would not be required for nonfinancial end users. The proposed rule would also not require posting collateral below a $65 million threshold. The agencies reproposed the rule because it differs significantly from their 2011 proposal.
The banking agencies finalized a liquidity coverage ratio rule that requires a company subject to the rule to maintain an amount of high-quality liquid assets that is at least 100% of its total net cash outflows over a prospective 30 calendar-day period. The rule applies to large and internationally active banking organizations.
The SEC finalized a rule to enhance NRSRO governance, to protect against conflicts of interest, and increase transparency. It requires disclosure of credit rating performance statistics, procedures to protect the integrity and transparency of rating methodologies, disclosures to promote the transparency of credit ratings, and standards for training, experience, and competence of credit analysts. The requirements provide for an annual certification by the CEO as to the effectiveness of internal controls and additional certifications to accompany credit ratings attesting that the rating was not influenced by other business activities. The rule requires issuers, underwriters, and third-party due diligence services to promote the transparency of the findings and conclusions of third-party due diligence regarding asset-backed securities.
The SEC finalized rules governing the disclosure, reporting, and offering process for ABS. The rules require loan-level disclosure for certain assets, such as residential and commercial mortgages and automobile loans. The rules provide more time for investors to review and consider a securitization offering, revise the eligibility criteria for using shelf offerings, and revise reporting requirements.
The CFPB proposed expanded HMDA reporting requirements.
The CFPB released an interpretive rule that the ability-to-repay rule applies to assumptions when a creditor expressly agrees in writing to accept a new consumer as primary obligor on an existing mortgage loan that finances the acquisition or construction of the consumer’s principal dwelling.
The CFPB released Policy Guidance on mortgage brokers and mini-correspondent lending. The CFPB is concerned about mortgage brokers’ interest in becoming mini-correspondent lenders, thereby possibly altering the application of certain rules.
Mortgage brokers’ compensation must be disclosed GFE and HUD-1, but investor payments to lenders for secondary market transactions is excluded.
Compensation to a mortgage broker is included in QM points and fees. Interest paid to a creditor is excluded form points and fees.
Mortgage brokers may not receive compensation from a creditor and consumer in the same transaction, and mortgage brokers may not receive compensation based on loan terms.
The CFPB is concerned that some mortgage brokers are transitioning to mini-correspondent lenders, such as by closing loans in their own names and funding loans through a warehouse line of credit, while effectively continuing as brokers. It lists questions it will consider in determining whether a correspondent lending arrangement is actually a broker arrangement, such as whether the mini-correspondent acts as a broker in some transactions; how many investors it has to purchase loans; and whether the mini-correspondent, warehouse lender, or investor performs moat of the the origination activities.
The Federal Reserve, FDIC, and OCC finalized a rule that revises the definition of eligible guarantee in their advanced approaches risk-based capital rule, to remove the requirement that an eligible guarantee be made by an eligible guarantor for calculating the risk-weighted assets of an exposure (other than a securitization exposure).
The Federal Reserve proposed to amend its capital plan and stress test rules to modify the start date of the capital plan and stress test cycles from October 1 of a calendar year to January 1 of the following calendar year. The proposal would also amend the capital plan rule to limit a bank holding company’s ability to make capital distributions to the extent that its actual capital issuances are less than the amount indicated in its capital plan under baseline conditions. The proposal would clarify application of the capital plan rule to a bank holding company that is a subsidiary of a U.S. intermediate holding company of a foreign banking organization and the characteristics of a stressed scenario to be included in company run stress tests.
The FDIC and OCC proposed to similarly adjust their stress testing cycle dates. Annual stress test would be for a calendar year rather than for a year ending September 30. Banks over $10 billion and under $50 billion would submit annual stress test results by July 31 and publish summaries by October 31, a four month delay in each. Banks with over $50 billion in assets would submit reports by April 7 and publish summaries by July 15, a delay of about four months. The OCC’s proposal is here, and the FDIC’s is here.
The SEC reproposed a rule to remove references to credit ratings from rule 2a-7, the principal rule that governs money market funds, and Form N-MFP, which money market funds use to report on their portfolio holdings. The proposal would also amend rule 2a-7’s issuer diversification provisions to eliminate an exclusion for securities subject to a guarantee issued by a non-controlled person.
The SEC finalized a rule regarding cross-border swaps that defines when a cross-border transaction must be counted toward the requirement to register as a security-based swap dealer or major participant. The rule also addresses the scope of the SEC’s cross-border anti-fraud authority. The rule sets procedures to request substituted compliance, permitting market participants to satisfy certain security-based swap requirements by complying with comparable non-U.S. rules.
The SEC finalized a rule requiring institutional prime money market mutual funds to have floating net asset values.
The CFPB proposed to extend by five years an exemption to remittance transfer fee disclosures that permits estimates of third-party fees.
The FDIC finalized a rule that requires those who purchase receivership assets to certify that they have not contributed to the failure of a covered financial company.
The FDIC proposed to transfer certain OTS regulations and to amend its enforcement procedural rules.
The CFTC released an interim final regulation providing that, for a swap executed anonymously on a swap execution facility or designated contract market, and cleared in accordance with the CFTC’s straight-through processing requirements, the information maintained by a registered repository that may be accessed by either counterparty does not include the identity of the other counterparty or its clearing member, or its or its clearing member’s legal entity identifier.
The CFTC solicits comment on a review of its swap data reporting rules regarding reporting challenges, data field standardization, and consistency in reporting.
The Federal Reserve released a final rule implementing prudential standards, including capital and liquidity standards, for bank holding companies and foreign banking organizations with total consolidated assets of $50 billion or more.
The SEC proposed a rule that would establish standards for the operation and governance of certain types of registered clearing agencies that meet the definition of a covered clearing agency.
The CFPB released an ANPR to define larger participants of a market for international money transfers.
The Federal Reserve approved a final rule establishing enhanced prudential standards for large U.S. bank holding companies and foreign banking organizations. The standards include liquidity, risk management, and capital. The rule also requires a foreign banking organization with with U.S. non-branch assets of $50 billion or more to establish an intermediate holding company over its U.S. subsidiaries. The final rule will not apply to nonbank financial companies that are designated by FSOC for Federal Reserve supervision, as prudential standards for these institutions will be through a separate order or rule. The new rule does not implement single-counterparty credit limits or early remediation requirements for U.S. or foreign banking organizations, which will be implemented at a later date.
The Federal Reserve requested comment on proposals to repeal its Regulation DD (truth in savings) and Regulation P (consumer financial privacy) because CFPB regulations have replaced the Federal Reserve’s regulations.
The SEC again extended the expiration dates in interim final rules that provide exemptions under the 1933 and 1934 Acts and the Trust Indenture Act for security-based swaps that before July 16, 2011 were security-based swap agreements and are defined as “securities” as of July 16, 2011 due solely to Title VII. The extension is until February 11, 2017.
The CFTC, FDIC, Federal Reserve, OCC, and SEC released in interim final regulation to permit banking entities to retain interests in certain CDOs backed primarily by trust preferred securities under the Volcker rule. This permits retention of an interest in or sponsorship of covered funds by banking entities if:
The banking entity's interest in the TruPS CDO was acquired on or before December 10, 2013.
The agencies also released a non-exclusive list of issuers that meet the interim final rule.
The CFPB released revised mortgage booklets, on HELOCs, ARM loans, and on shopping for a mortgage.
The CFTC requested comment on an advisory it issued on November 14, 2013 regarding the applicability of certain CFTC regulations to the activity in the U.S. of CFTC-registered swap dealers and major swap participants that are established in jurisdictions other than the U.S.
The Federal Reserve requested comment on proposed revisions to the Regulation HH risk-management standards for systemically important financial market. The Board also requested comment on related revisions to part I of theFederal Reserve Policy on Payment System Risk, which is applicable to financial market infrastructures more generally. Both are based on and generally consistent with the April 2012 Principles for Financial Market Infrastructures developed jointly by the international standard-setting bodies, the Committee on Payment and Settlement Systems and the Technical Committee of the International Organization of Securities Commissions. Revisions include establishing separate standards to address credit risk and liquidity risk, a new standard on general business risk, and heightened requirements on transparency and disclosure.
The Regulation HH proposal is here;
The policy proposal is here.
The SEC temporarily stayed rules related to municipal adviser registration and recordkeeping requirements until July 1, 2014 to conform certain dates in the rules to a July 1, 2014 compliance date.
The SEC released two final rules removing references to credit ratings from regulations.
The first concerns determinations of when an investment company may treat a repurchase agreement as an acquisition of securities collateralizing the repurchase agreement for certain purposes under the Investment Company Act.
The second concerns the broker-dealer financial responsibility and confirmations of transactions rules under the Exchange Act.
• The Federal Reserve Board proposed amendments to Regulation A, governing Federal Reserve Bank extensions of credit, to implement Dodd-Frank amendments to the Federal Reserve's emergency lending authority. The proposed rule is designed to ensure that any emergency lending program or facility is for the purpose of providing liquidity to the financial system, and not to aid an individual failing financial company.
• FHFA issued orders prescribing GSE stress testing scenarios.
• The banking agencies, CFTC, and SEC released final Volcker rules, and the banking agencies released FAQs on CDOs backed by trust preferred securities. The Federal Reserve announced that banking entities will be required to fully conform by July 21, 2015, and that the other agencies will apply the rule accordingly. This extension does not apply to recordkeeping and reporting of Appendix A to certain banking entities with significant trading activities. The CFTC’s rule is similar but separate.
On December 23, the American Bankers Assocciation, CB&T Bancshares, Inc., Citizens Bank & Trust Company, MBT Financial Corporation and Monroe Bank & Trust Company sued the banking agencies in the D.C. Circuit Court of Appeals challenging a portion of the rule. They next day, they filed an emergency motion for a stay of the definition of “other similar interests” in § _.10(d)(6) of the rule, pending the appeal. The motion states, “To the shock of community banks, the Final Rule unexpectedly requires banks to divest their holdings in a commonly held debt instrument known as a ‘TruPS-backed CDO’ by July 2015 and, under Generally Accepted Accounting Principles (‘GAAP’), to take an immediate and irrevocable hit to earnings and capital as a result.”
• The FDIC published for comment a notice of its Single Point of Entry strategy for orderly SIFI liquidations, under which the FDIC would be appointed receiver only of the top-tier U.S. holding company, and subsidiaries would remain open and continue operations.
• The Federal Insurance Office (FIO) released a report entitled “How to Modernize and Improve the System of Insurance Regulation in the United States.” The report includes recommendations for “near-term reform for the States” concerning safety and soundness and capital adequacy, insurance company resolution practices, and marketplace regulation.
• The Federal Reserve finalized what had been an interim final rule clarifying the § 716 treatment of uninsured U.S. branches and agencies of foreign banks. This implements a restriction on federal assistance, such as discount window lending and deposit insurance, to swaps entities. Insured depository institutions that are swaps entities are eligible for a transition period of up to 24 months. The final rule clarifies that uninsured U.S. branches and agencies of foreign banks are treated as insured depository institutions. The final rule also sets the process for state member banks and uninsured state branches or agencies of foreign banks to apply for the transition period.
• GAO released a report on regulatory analyses by agencies during Dodd-Frank rulemakings. The report says that OMB, in coordination with the agencies, may not be consistently determining which rules are considered major rules, which permits Congressional review before a rule can become effective if the rule will have an annual effect of $100 million or more. GAO found that some independent agencies submitted all their rules to OMB, but others did not. GAO also found inconsistencies in how these agencies applied the underlying criteria. For example, GAO found rules issued by different agencies that had similar economic impacts but were not similarly classified as major. Also, in 2011, GAO recommended that the regulators determine how they will measure the impact of Dodd-Frank regulations in their plans to conduct retrospective reviews, but they have not done so to date. GAO recommends that OMB issue guidance to help standardize the processes. OMB disagreed such guidance is needed.
• GAO released a report on the SEC’s financial statements for the fiscal years ended September 30, 2013 and 2012, including statements for the SEC’s investor protection fund, and found them presented fairly in all material respects.
• GAO released a report on the CFPB’s financial statements for the fiscal years ended September 30, 2013, and 2012, and found them presented fairly in all material respects.
• The Office of Financial Research released a 2013 annual report analyzing threats to U.S. financial stability.
The report finds the chief threats are vulnerabilities in markets for securities financing transactions and credit, vulnerabilities to an increase in interest rates and volatility, operational risks, and uncertainty about the U.S. fiscal policy outlook.
The report presents a prototype Financial Stability Monitor tool to track threats and the interplay among them. The monitor addresses five components of financial stability risk: macroeconomic, market, credit, funding and liquidity, and contagion.
The report states that while regulators have expanded their macroprudential tools, gaps remain. The report states that bank stress testing could be improved by incorporating funding risks, potential spillovers, and feedback effects. OFR maintains an inventory describing the data that FSOC member agencies purchase or collect.
OFR is standardizing the types and formats of data reported and collected, such as working with the CFTC and global regulators to standardize derivatives reporting.
This is the December 8, 2013 updates to the “Roadmap to Financial and Housing Market Stabilization Plans” document. These updates include the following:
Treasury announced that it priced a secondary public offering of 1,846,374 warrants to purchase common stock of Cathay General Bancorp at $7.20 per warrant, for expected proceeds to Treasury of $13,107,778.
FHFA announced that Fannie Mae and Freddie Mac completed the first major overhaul of mortgage insurance master policy requirements in many years. The policies will support loss mitigation, establish specific timeframes for processing claims, sets standards for determining when MI coverage must be maintained and when it may be revoked, and will promote information sharing among insurers, servicers, and the GSEs. The GSEs anticipate that the master policies will go into effect in 2014, pending review and approval by state insurance regulators.
The CFTC published a final rule that imposes requirements on swap dealers and major swap participants with respect to the treatment of collateral posted by their counterparties to margin, guarantee, or secure uncleared swaps. Additionally, the final rule includes revisions to ensure that, for purposes of subchapter IV of chapter 7 of the Bankruptcy Code, securities held in a portfolio margining account that is a futures account or a Cleared Swaps Customer Account constitute “customer property” and owners of such account constitute “customers.”
The CFTC published a final rule that excludes persons whose functions are solely clerical or ministerial from the definition of “associated person,” for purposes of a ban on associated persons who are subject to a statutory disqualification from effecting swaps on behalf of a swap dealer or major swap participant.
The CFPB published a policy to encourage trial disclosure programs.
The OCC finalized guidance setting the general processes and factors OCC will use to develop and distribute the stress test scenarios for the annual stress tests for banks and thrifts with assets over $10 billion.
The CFPB published an interim final rule establishing procedures for administrative adjudication of contested temporary cease and desist orders. Comments are due November 25, 2013.
FHFA published a final rule requiring annual stress tests for Fannie Mae, Freddie Mac, and the FHLBs. It also released summary instructions and guidance.
The SEC proposed a rule that would require disclosure of the median of the annual total compensation of all employees of an issuer (excluding the chief executive officer), the annual total compensation of that issuer’s chief executive officer and the ratio of the median of the annual total compensation of all employees to the annual total compensation of the chief executive officer. Emerging growth companies, smaller reporting companies, and foreign private issuers would be exempt. Comments are due 60 days after Federal Register publication.
The SEC finalized rules requiring municipal adviser registration. It exempts employees and appointed officials of municipal entities from registration, and narrows the application of the term “investment strategies” to apply only to the investment of proceeds from the sale of municipal securities rather than to all public funds.
Six agencies reproposed their risk-retention rule. It would define QRM the same as term QM in the ability-to-repay regulation. The reproposal also has an alternative QRM definition that would include certain underwriting standards in addition to the qualified mortgage criteria. Similar to the original proposal, under the reproposal, securitizations of commercial loans, commercial mortgages, or automobile loans of low credit risk would not be subject to risk retention. Further, the reproposal would recognize the full guarantee on payments of principal and interest provided by Fannie Mae and Freddie Mac as meeting the risk retention requirements while the GSEs are in conservatorship or receivership and have federal capital support.
The CFPB published a ratification of its actions during Director Cordray’s recess appointment.
The CFTC finalized an interpretation of the term “actual delivery” under the Commodity Exchange Act.
The CFTC finalized a regulation regarding compliance obligations for commodity pool operators of investment companies registered under the Investment Company Act and amending regulations applicable to all commodity pool operators and commodity trading advisors.
The CFTC finalized a regulation allowing cooperatives meeting certain conditions to elect not to submit certain swaps for clearing.
The CFPB, FDIC, Federal Reserve, FHFA, NCUA, and OCC released a supplemental proposal relating to appraisals for higher-priced mortgage loans. The proposal would exempt transactions secured by existing manufactured homes and not land, certain streamlined refinancings, and transactions of $25,000 or less. Comments are due September 9, 2013.
The CFPB released a regulation under the Federal Tort Claims Act, which governs injuries caused by agency employee negligence.
The CFTC released interpretive guidance and a policy statement regarding the cross-border application of the Dodd-Frank swaps provision. The guidance addresses the scope of the term “U.S. person,” the general framework for swap dealer and major swap participant registration determinations, the treatment of swaps involving certain foreign branches of U.S. banks, the treatment of swaps involving a non-U.S. counterparty guaranteed by a U.S. person or affiliate conduit, and the categorization of the Dodd-Frank swaps provisions as entity-level requirements or transaction-level requirements.
The Federal Banking Agencies released joint proposed guidance on stress tests for banking organizations with more than $10 billion but less than $50 billion in total consolidated assets. Comments are due September 25 to the FDIC and OCC, and September 30 to the Federal Reserve Board.
The CFPB released its first annual report on its financial literacy activities. The report states the agency is seeking to provide assistance to consumers at specific important points in their financial lives; researching effective approaches to financial education and to better define the metrics for success; and reaching out to stakeholders who can assist in reaching the public.
The CFTC released, and solicits comment on, an extension of a January 2013 exemptive order, with amendments. The order provides targeted, time-limited relief from certain Dodd-Frank requirements to facilitate an orderly transition to those requirements. The exemptions concern entity-level requirements for a foreign person that registers as a swap dealer or major swap participant, and transaction-level requirements for foreign swap dealers and major swap participants, and foreign branches of U.S. swap dealers and major swap participants. The order is extended through the end of 2013, but some provisions sunset earlier.
GAO released a report entitled Information on Responsible Sourcing and Companies Affectedconcerning the SEC’s conflict minerals rule. The rule requires companies to disclose their use of conflict minerals and the origin of those minerals. The report discusses factors, such as lack of infrastructure and security, that could affect efforts to achieve conflict-free sourcing of minerals. Limited transportation, poor roads in parts of the Democratic Republic of the Congo, and the remoteness of mines make it difficult to validate mines and to ensure that the mines have not been compromised by illegal armed groups. The report also discusses that the rule may affect those who are not subject to the rule, because they may supply components or parts that contain conflict minerals to companies subject to the rule. The report makes no recommendations.
GAO released a report entitled Alternative Criteria for Qualifying As an Accredited Investor Should Be Considered. Accredited investors who meet certain income and net worth thresholds may participate in unregistered securities offerings. To qualify as accredited, SEC requires an investor to have an annual income over $200,000 ($300,000 for a married couple) or a net worth over $1 million, excluding a primary residence. The report examines market participants’ views on the existing criteria for accredited investor status and potential alternative criteria. GAO recommends that the SEC consider alternatives, such as liquid investments and use of a registered adviser, as alternative criteria, and the SEC agreed.
GAO released a report entitled Need to Further Consider Proposals’ Impact on Systemic Risk. It discusses proposals to give financial regulators a greater role in financial company bankruptcies. Experts reported that funding is needed to facilitate orderly and effective financial company bankruptcies, but a source is not clear. Experts did not agree on advantages or disadvantages of proposals to change the automatic stay exemption for qualified financial contracts (including derivatives), and the ability of bankruptcy courts to avoid qualified financial contracts in some circumstances. GAO recommends that FSOC consider the implications of changing the role of regulators and the treatment of qualified financial contracts in financial company bankruptcies. The report states that FSOC believes it would be premature to consider proposals to change the Bankruptcy Code.
GAO released a report entitled Improving Personnel Management Is Critical for Agency’s Effectiveness. The report examines the SEC’s organizational culture, and its personnel management challenges and efforts to address these challenges. It notes that the SEC has made progress, but that continued improvement is needed in workforce planning, performance management, communication and collaboration, and personnel management assessment. GAO recommends developing comprehensive workforce plans, implementing mechanisms to monitor how supervisors use the performance management system, conducting periodic validations of the system, exploring collaboration practices of leading organizations, and regularly assessing these efforts. SEC agreed with GAO’s recommendations.
The SEC rescinded rules on its supervision of investment bank holding companies that the Dodd-Frank Act made obsolete.
The banking agencies finalized a capital rule that revises their risk-based and leverage capital requirements for banking organizations. The rule sets a new common equity tier 1 requirement and higher minimum tier 1 requirements for all banking organizations. Banking organizations with more than $50 billion in assets have enhanced disclosure requirements related to regulatory capital adequacy and risk management. Banking organizations subject to the advanced approaches capital rules also must meet a supplementary leverage ratio requirement. The rule does not change the treatment of residential mortgage exposures. The FDIC’s rule is substantially identical, although it is an interim final rule.
The banking agencies proposed a rule to require bank holding companies with more than $700 billion in consolidated total assets or $10 trillion in assets under custody to maintain tier 1 capital of at least 2 percent above the minimum supplementary leverage ratio requirement of 3 percent. The proposed rule would also require banks under these companies to meet a 6 percent supplementary leverage ratio to be considered well capitalized. The proposed rule would apply to the eight largest U.S. banking organizations.
The CFPB released a final rule establishing the procedures by which the agency will determine it has supervisory authority over nonblanks.
The CFTC released an amended order expanding the list of Legal Entity Identifiers that registered entities and swap counterparties can use in complying with swap data reporting regulations.
FSOC designated AIG and General Electric Capital Corp. as systemically significant and subject to Federal Reserve supervision.
The SEC finalized a rule to permit registered broker-dealers to engage in a retail foreign exchange business.
The SEC finalized a rule that disqualifies certain felons from Regulation D offerings.
The OCC finalized with amendments an interim final rule that consolidates the national bank lending limit rules with federal thrift rules on loans to one borrower. The Dodd-Frank Act expended the definition of loans to include certain derivatives, repurchase and reverse agreements, and securities borrowing and lending transactions. The rule becomes effective October 1, 2013.
The FDIC finalized a rule that establishes criteria for determining whether a company is predominantly engaged in “activities that are financial in nature or incidental thereto” and if so, unless it is a bank, it may be subject to Dodd-Frank’s orderly liquidation authority.
The Federal Reserve released an interim final rule clarifying the treatment of uninsured U.S. branches and agencies of foreign banks under the swaps push-out provision that prohibits federal swap-related federal assistance to swaps entities that are not an insured depository institution. The rule treats uninsured U.S. branches and agencies of foreign banks as insured depository institutions. It is effective immediately, and comments are due August 4, 2013.
The SEC proposed a rule with two alternatives for regulation of money market mutual funds. One would require a floating net asset value, and the other would require a liquidity fee below a threshold and permit temporary redemption suspensions. Comments are due 90 days after Federal Register publication. On November 13, 2012, FSOC proposed to recommend that the SEC make money market reforms.
The CFPB released a final remittance transfers rule to address disclosures of transferee fees and taxes, and to streamline resolutions of transferor errors. The rule is effective October 28, 2013.
The CFTC released interpretive guidance and a policy statement on the scope of prohibitions on disruptive trading, practices, or conduct.
FHFA proposed a rule to remove credit rating references from regulations applicable to the FHLBs. Comments are due July 22, 2013.
The FFIEC Appraisal Subcommittee finalized revisions to its appraisal policy statements, effective June 1, 2013.
The CFTC finalized a rule that defines the criteria for grouping swaps into separate swap categories and establishes methodologies for setting appropriate minimum block sizes for each swap category. The rule also has measures to prevent the public disclosure of the identities, business transactions, and market positions of swaps market participants. The rule is effective 60 days after Federal Register publication.
The CFTC finalized a rule, guidance, and acceptable practices that establish registration requirements and core principles for swap execution facilities. The compliance date for most of the rule is 120 days after Federal Register publication.
The CFTC finalized a rule that that establishes a process for a designated contract market or swap execution facility to make a swap subject to the trade execution requirement. Compliance will be required on the later of the applicable deadline established for the clearing requirement for a swap, or 30 days after the available-to-trade determination for that swap is deemed approved or certified. CFTC compliance dates are available here.
The CFPB proposes to extend the effective date of 12 C.F.R. § 1026.26(i), which prohibits a mortgage creditor from financing premiums for credit insurance, but the prohibition does not apply if the premiums are calculated and paid in full monthly, or to certain credit unemployment insurance. This rule was to have become effective June 1, 2013, but the CFPB received questions about the rule’s applicability to insurance on which premiums are paid periodically. The CFPB reproposed this aspect of its regulation, and will delay its effective date until it provides clarifications and time to implement the rule. Comments are due May 25, 2013.
The CFPB released a final and proposed regulation on its civil money penalty fund established by § 1017(d) of the Dodd-Frank Act. When the CFPB collects civil money penalties, the go into this fund “for payments to the victims of activities for which civil penalties have been imposed under the Federal consumer financial laws. To the extent that such victims cannot be located or such payments are otherwise not practicable, the Bureau may use such funds for the purpose of consumer education and financial literacy programs.” The final rule was never proposed, as the CFPB states it is not subject to the APA, although it is accepting comments on the proposed rule. The final rule sets out the types of payments the fund will make to victims and it establishes procedures for allocating funds to victims and for consumer education and financial literacy programs. Comments on the proposed rule are due June 8, 2013.
The CFPB finalized a Card Act rule that permits credit card issuers to determine a consumer’s ability to pay based on income or assets to which a consumer over age 21 has a reasonable expectation of access, such a spouse’s income.
The CFPB determined that a Tennessee escheat law, but not a Maine law, is preempted by the EFTA. The EFTA and Regulation E require that gift cards not expire sooner than five years after funds are last loaded onto the cards. Tennessee treats gift certificates abandoned on the earlier of their stated expiration date or in two years from issuance. To the extent this law applies to gift cards, the CFPB preempted it.
The SEC reopened the comment periods for several rules concerning security-based swaps and security-based swap market participants, as well as its general policy on sequencing compliance dates, now that the SEC has proposed substantially all of the rules that Title VII requires. Comments are due July 22, 2013.
The SEC proposed rules and interpretations to address application of the Exchange Act to cross-border security-based swap activities. It would address Subtitle B of Title VII respect to each of the major registration categories in connection with reporting and dissemination, clearing, and trade execution for security-based swaps. It reproposes Regulation SBSR and certain rules and forms, and proposes an exception from the aggregation requirement, in the context of the security-based swap dealer definition, for affiliated groups with a registered security-based swap dealer. Moreover, the proposal addresses the sharing of information and preservation of confidentiality with respect to data collected and maintained by swap data repositories. Comments are due August 21, 2013.
The CFTC and SEC finalized identity theft red flags regulations and guidance. The compliance date is November 20, 2013.
The Federal Reserve proposed an assessments rule for holding companies with total consolidated assets of $50 billion or more, and nonbank companies designated for Board supervision. Comments are due June 15, 2013.
The FSOC released a final regulation setting out how the FSOC will determine that a nonbank financial company should be supervised by the Federal Reserve. It is effective 30 days after Federal Register publication.
The FSOC amended its procedures for proposed designations of financial institutions engaged in payment, clearing, or settlement activities.
GAO released a report required every three years on the SEC’s structure for internal supervisory control for examinations, corporate financial securities filing reviews, and investigations. GAO identified deficiencies in about half of the 60 internal supervisory controls it tested. GAO recommends that the SEC ensure that internal supervisory controls have clearly defined activities and clear and readily available documentation demonstrating execution of the activities.
The CFPB released a final rule on its information disclosures. Just as in the July 2011 interim final rule, the final rule provides:
“To the extent permitted by law and as authorized by the Director in writing, the CFPB may disclose confidential information other than as set forth in this subpart.”
In the preamble, the CFPB explained that it intends to use this provision “to account for rare situations in which an unforeseen and exigent need exists to disclose confidential information for purposes or in a manner not otherwise provided for in the rule.”
GAO released a report on Dodd-Frank implementation. GAO describes the difficulty in evaluating the costs and benefits of the Dodd-Frank Act’s reforms. Some costs, such as the law’s impact on the economy, cannot be easily quantified. Studies have estimated the economic impact of certain of the act’s reforms, but GAO says their results vary widely and depend on key assumptions. The report says federal agencies report having put over $1 billion in resources toward implementing the Dodd-Frank Act since 2010. The CFPB has spent $432.3 million, more than any other agency.
The SEC issued an order granting a temporary exemption, until February 11, 2014, from certain Exchange Act provisions in connection with the revised definition of “security” to encompass security-based swaps. The temporary exemptions include exemptions in connection with security-based swap activity by certain eligible contract participants; and exemptions specific to security-based swap activities by registered brokers and dealers.
Roadmap to Dodd-Frank Act Rulemakings, Studies, and Reports Update
The Federal Reserve extended the public comment period on a proposal to implement enhanced prudential standards and early remediation requirements for foreign financial companies the Board supervises. Comments were originally due March 31, 2013, and are now due April 30, 2013.
The CFPB solicits comment on how partnerships or arrangements between higher education institutions and financial institutions could promote positive financial decision-making among young consumers and what financial products and services are being offered to college students. Comments are due March 18.
The SEC extended for a year, until February 11, 2014, the expiration dates in interim final rules that provide exemptions under the 1933 and 1934 Acts and the Trust Indenture Act for security-based swaps that before July 16, 2011 were security-based swap agreements and are defined as “securities” as of July 16, 2011 due solely to Title VII.
The CFPB finalized a rule that requires delivery of property valuations, effective January 18, 2014.
The CFPB released a final loan originator compensation rule. Most of it is effective January 10, 2014. However, a prohibition on mandatory arbitration in loans secured by a dwelling, and a prohibition on financing single-premium credit insurance, are effective June 1, 2013.
The CFPB delayed the effective date of its remittance transfers rule until after proposed amendments to the rule, for which the comment period closes January 30, are final. The rule was scheduled to go into effect February 7. The CFPB has not set a new effective date.
The SEC finalized a rule regarding lost securityholders and unresponsive payees. It is effective March 25, 2013, and the compliance date is January 23, 2014.
The SEC extended until February 22 the comment period on a proposed rule that would set capital, margin, and segregation requirements for security-based swap dealers and participants, and capital requirements for broker-dealers.
GAO released a report that is not required by the Dodd-Frank Act, but looks at its implementation. GAO found that as of December 2012, regulators had issued 48 percent of the required final rules. Of the remaining provisions, GAO found that regulators had proposed rules for about 29 percent, and rulemakings had not occurred for about 23 percent. Separately, GAO released a non-Dodd-Frank reportabout rulemakings from 2003 through 2010, finding that in this period, agencies did not publish a proposed rule for comment in 35 percent of major rulemakings and 44 percent of nonmajor rulemakings.
Roadmap to Dodd-Frank Act Rulemakings, Studies and Reports
Attached please find an updated Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports. Please click on the title hyperlink to access the full report.
The CFPB requests comments on how the credit card market is functioning under the CARD Act. Comments are due February 19, 2013.
The CFPB proposed to revise its remittance transfers rule to provide more flexibility about disclosing foreign taxes and fees by recipient institutions; to limit the required disclosure of taxes to taxes charged only by a central government; and to revise the error resolution provisions that apply when the sender provided incorrect or insufficient information. The Bureau is also proposing to temporarily delay the effective date until 90 days after this rule is final. Comments on the effective date are due January 15, and on the rest of the proposal are due January 30, 2013.
The CFTC proposed to extend compliance dates for several of its rules. Dates for regulations at 17 C.F.R. § 23.201(b)(3)(ii), 23.402; 23.410(c); 23.430; 23.431(a) through (c); 23.432; 23.434(a)(2), (b), and (c); 23.440; 23.450, and 23.505 is extended until May 1, 2013; the compliance date for the regulations at 17 C.F.R. § 23.502 and 23.504 is extended until July 1, 2013. Comments on the extensions are due February 1, 2013. The CFRC published a list of compliance dates searchable by rulemaking or topic here.
The OCC extended a temporary exception to the lending limit rule for credit exposures arising from a derivative transaction or securities financing transaction, from January 1, 2013 to July 1, 2013. Dodd-Frank § 610 extended the rule to credit exposure from a derivative transaction, repurchase agreement, reverse repurchase agreement, securities lending transaction, or securities borrowing transaction. The OCC published an interim final rule June 21, 2012, applicable to the new transactions January 1, 2013, now extended.
The OCC published a notice to insured depository institutions that are or may become swap dealers that the OCC is prepared to favorably consider requests for a transition period for Dodd-Frank § 716(f) if the requests conform to the procedures and conditions established in the notice, and are submitted by January 31, 2013. Section 716 prohibits Federal assistance to swaps entities, including federal depository institutions that are swap dealers, with some exceptions.
The CFPB submitted an annual fair lending report to Congress. It says the CFPB is The CFPB has begun the planning process to promulgate rules concerning small, minority-, and women-owned business loan data collection and reporting, and is examining what changes it may propose to Regulation C. TILA prohibits abusive or unfair lending practices that promote disparities among consumers of equal credit worthiness but of different race, ethnicity, gender, or age, and the report says the CFPB has begun preliminary planning with regard to this rule.
The CFTC finalized a rule that requires futures commission merchants, introducing brokers, retail foreign exchange dealers all members of a designated contract market or swap execution facilities to retain records of all written communications provided or received concerning quotes, solicitations, bids, offers, instructions, trading, and prices, that lead to the execution of a transaction in a commodity interest or related cash or forward transactions. There is a one-year implementation period.
The CFTC finalized a rule requiring that certain classes of credit default swaps and interest rate swaps be cleared by a registered derivatives clearing organization. The rules become effective February 11, 2013.
The Federal Reserve proposed to implement enhanced prudential standards and early remediation requirements for foreign financial companies the Board supervises. A foreign banking organization with both $50 billion or more in global consolidated assets and U.S. subsidiaries with $10 billion or more in total assets generally would be required to organize its U.S. subsidiaries under a single U.S. intermediate holding company. These intermediate holding companies would be subject to the same risk-based and leverage capital standards applicable to U.S. bank holding companies. Intermediate holding companies with $50 billion or more in consolidated assets also would be subject to the Board’s capital plan rule. The U.S. operations of foreign banking organizations with combined U.S. assets of $50 billion or more would be required to meet enhanced liquidity risk-management standards, conduct liquidity stress tests, and hold a 30-day buffer of highly liquid assets. The proposal also includes measures regarding capital stress tests, single-counterparty credit limits, overall risk management, and early remediation. Foreign banking organizations with global consolidated assets of $50 billion or more on July 1, 2014, would be required to meet the new standards on July 1, 2015. Comments are due March 31, 2013.
GAO released a report of Agencies’ Efforts to Analyze and Coordinate Their Rules under the Dodd-Frank Act. GAO’s review of selected rules found that regulators did not consistently follow key elements of the OMB guidance on cost-benefit analyses. GAO concluded that it is too soon to measure the impact of the Dodd-Frank rules that are final and effective, and it will take time to implement them. GAO’s analysis suggests that, to date, the Dodd-Frank Act may have had little effect on U.S. bank SIFIs’ funding costs but may have helped improve their safety and soundness. The report reiterates GAO’s 2011 recommendations that the federal financial regulators more fully incorporate OMB’s guidance into their rulemaking policies and that FSOC work with the regulators to establish formal interagency coordination policies for rulemaking.
The NCUA finalized a rule establishing alternatives to credit ratings in its regulations. It is effective June 11, 2013.
The President waived a rescission of discretionary appropriations under the American Recovery and Reinvestment Act of 2009 (the “stimulus bill” or “ARRA”). ARRA § 1603 originally provided that appropriated funds, under Division A appropriations provisions of ARRA, are available until September 30, 2010. Dodd-Frank § 1306 extended that date to December 31, 2012, and provided that discretionary appropriations that are not obligated by December 31, 2012 are rescinded and returned to the Treasury for deficit reduction. Dodd-Frank also gave the President authority to waive that rescission if it is not in the best interests of the Nation, and that is what the President waived.
The CFPB announced that in December it will propose revisions to its remittance transfers rule relating to (1) errors resulting from incorrect account numbers provided by senders of remittance transfers; (2) the disclosure of certain foreign taxes and third-party fees; and (3) the disclosure of sub-national, foreign taxes. The rule, as amended, will become effective 90 days after the amendment is final, instead of February 7, 2013 as originally scheduled.
The Federal banking agencies released an Interagency Statement on Section 612 of the Dodd–Frank Act: Restrictions on Conversions of Troubled Banks. It explains the restrictions on converting from a state to federal or national charter, or vice versa.
FSOC released five questions on its recent proposed recommendations regarding money market mutual funds.
FSOC released a proposed recommendationto the SEC to implement structural reforms for money market mutual funds. The FSOC is using its § 120 authority to develop a recommendation that the SEC apply new or heightened standards or safeguards. Once a recommendation is final, the SEC must either impose the standards, impose similar standards the FSOC deems acceptable, or explain to the FSOC why it does not follow the recommendation. The SEC has 90 days from the FSOC final recommendation. FSOC must report its final recommendation and the SEC’s decision to Congress. The release is a proposed recommendation, and after the comment period, the FSOC may make a final recommendation to the SEC. FSOC lists alternatives for reforms:
Floating net asset value (“NAV”);
A NAV buffer with assets up to 1 percent to absorb day-to-day fluctuations in the value of the funds’ portfolio and allow the funds to maintain a stable NAV.
Require a risk-based NAV buffer of 3 percent with other measures to make the buffer more effective.
Comments are due 60 days from Federal Register publication.
Dodd-Frank Act Rulemakings, Studies, and Reports Updates
The FDIC published a final rule requiring annual stress tests for FDIC-regulated banks with over $10 billion in assets. Implementation for banks with assets between $10 billion and $50 billion is delayed until September 2013.
The Federal Reserve published a final rule requiring annual stress tests for bank holding companies with assets between $10 billion and $50 billion and savings and loan holding companies and state member banks with total consolidated assets greater than $10 billion. Implementation is delayed until September 2013. It issued a separate final rule for stress testing banking organizations with assets over $50 billion, effective November 15, 2012.
The OCC published a final rule requiring annual stress tests for national banks and federal thrifts with over $10 billion in assets. The rule applies to those with assets over $50 billion immediately and to the others not until 2013.
FHFA proposed a rule to require stress tests for Fannie Mae, Freddie Mac, and the FHLBs, each of which has over $10 billion in assets. Comments are due November 5.
The CFTC proposed a rule to add swaps, swap markets, and swap entities to numerous definitions and regulations, and to make a number of conforming amendments to integrate the CFTC’s regulations more fully with the Dodd-Frank regulations. Comments are due 60 days after Federal Register publication.
The FDIC published a final rule that permits the FDIC, as receiver for a systemically significant financial company, to enforce contracts of subsidiaries or affiliates of the company despite contract clauses that purport to terminate or accelerate the contract based on the financial condition of the company.
The FDIC published an initial regulatory flexibility analysis of its August 30 proposed rule on calculating risk-weighted assets. Comments are due November 16, 2012.
The OCC proposed to amend its retail foreign exchange rule for transactions with bank common trust funds, bank collective investment funds, and insurance company separate accounts.
The CFPB proposed a rulethat would permit credit card issuers to consider income to which a credit applicant has a reasonable expectation of access, and not just the applicant’s independent ability to repay the credit. Comments are due 60 days after Federal Register publication.
The CFPB proposeda rule and published a revised “system of records,” both under the Privacy Act of 1974, which restricts federal agencies’ ability to divulge information they collect about individuals. The effect of both is to permit the CFPB to disclose consumer complaint information to a variety of persons enumerated in the revised system of records. Comments on both are due November 19, 2012.
The SEC proposed a rulesetting capital and margin requirements for security-based swap dealers and major security-based swap participants, segregation requirements for security-based swap dealers, and notification requirements with respect to segregation for security-based swap dealers and major security-based swap participants. The rule would also increase the minimum net capital requirements for broker-dealers permitted to use the alternative internal model-based method for computing net capital. The SEC also posted a Fact Sheetdescribing the rule. Comments are due 60 days after Federal Register publication.
The FDIC published a final rulerequiring annual stress tests for FDIC-regulated banks with over $10 billion in assets. Implementation for banks with assets between $10 billion and $50 billion is delayed until September 2013.
The Federal Reserve published a final rulerequiring annual stress tests for bank holding companies with assets between $10 billion and $50 billion and savings and loan holding companies and state member banks with total consolidated assets greater than $10 billion. Implementation is delayed until September 2013. It issued a separate final rulefor stress testing banking organizations with assets over $50 billion, effective November 15, 2012.
The OCC published a final rulerequiring annual stress tests for national banks and federal thrifts with over $10 billion in assets. The rule applies to those with assets over $50 billion immediately and to the others not until 2013.
FHFA proposeda rule to require stress tests for Fannie Mae, Freddie Mac, and the FHLBs, each of which has over $10 billion in assets. Comments are due November 5.
The CFTC proposeda rule to add swaps, swap markets, and swap entities to numerous definitions and regulations, and to make a number of conforming amendments to integrate the CFTC’s regulations more fully with the Dodd-Frank regulations. Comments are due 60 days after Federal Register publication.
The FDIC published a final rulethat permits the FDIC, as receiver for a systemically significant financial company, to enforce contracts of subsidiaries or affiliates of the company despite contract clauses that purport to terminate or accelerate the contract based on the financial condition of the company.
The FDIC published an initial regulatory flexibility analysisof its August 30 proposed rule on calculating risk-weighted assets. Comments are due November 16, 2012.
The OCC proposed to amend its retail foreign exchangerule for transactions with bank common trust funds, bank collective investment funds, and insurance company separate accounts.
Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports.
Roadmap to the Dodd-Frank Act Rulemakings, Studies, and Reports
This updates includes: •The CFTC finalized a rule setting requirements for swap confirmation, portfolio reconciliation, portfolio compression, and swap trading relationship documentation for swap dealers and major swap participants. •The CFTC finalized a rule to amends its regulations governing commodity pool operators and commodity trading advisors to reflect Dodd-Frank Act changes, so the rules continue to apply for these intermediaries in the context of their involvement with swap transactions. •The federal banking agencies are considering postponing the implementation timeline for the annual company-run stress test requirements until September 2013 for banking organizations with between $10 billion and $50 billion in total consolidated assets. •The FFIEC Appraisal Subcommittee proposed to amend its policy statements to provide guidance to ensure state appraiser regulatory programs comply with FIRREA, as amended by the Dodd-Frank Act. Further detailed information is contained in the report.
* The CFPB proposed a regulation under the Equal Credit Opportunity Act that would require mortgage lenders to provide a copy of appraisals and other property valuations to applicants for loans to be secured by a first lien on a dwelling. Comments are due October 15, 2012. * CFTC proposed a rule that would exempt from clearing swaps between affiliates. Comments are due September 20, 2012. * The CFTC proposed an order that would exempt certain government-owned or cooperative electric utilities from most of the Commodity Exchange Act for non-financial energy transactions. * The SEC adopted a rule requiring payment disclosures by resource extraction issuers. * The SEC adopted another rule requiring disclosures by users of conflict minerals. * Treasury proposes to include in its procurement contracts of $150,000 or more a clause that requires the contractor to provide, within 10 days of request, or longer if the agency specifies, for no additional consideration, documentation of the actions it and its subcontractors have undertaken to demonstrate their good faith effort to comply with its commitment to equal opportunity in employment and contracting.
Roadmap to Dodd-Frank Act Rulemakings,Studies, and Reports
•Six agencies proposed an appraisal rule for higher-risk mortgage loans. Section 1471 requires these loans to be underwritten with an appraisal that includes an interior inspection.
* The CFPB proposed two servicing rules, one under Regulation X and the other under Regulation Z. * The CFTC published a correction to the preamble of its January 9, 2012 real-time public reporting rule.
RoadMap to Dodd-Frank Act Rulemakings, Studies,and Reports Update
* The CFPB revised its February 2012 rule on remittance transfers. As revised, the rule will not apply to those who provide fewer than 100 remittance transfers annually. The rule amends disclosure procedures for prescheduled transfers. The rule is effective February 7, 2013, as is the original rule.
Roadmap to the Dodd-Frank Act Rulemakings, Studies,and Reports
* The CFPB has a new webpage where it solicits requests for the CFPB to file amicus briefs in pending litigation. * The CFPB posted its information quality guidelines. * * Comments are due September 4. * The CFPB released in interim final rule that prohibits discrimination on the basis of disability in CFPB programs or activities. Comments are due 60 days after Federal Register publication.
The CFPB has a webpage to solicit CFPB amicus briefs in pending litigation * The CFPB posted its information quality standards
Dodd-Frank Act Rulemakings, Studies,and Reports Update
* The CFPB requests comments on how it can improve financial literacy. Comments are due October 31, 2012. * The CFPB published notice of its information quality guidelines, required by 106 Pub. L. No. 544 Appendix C, 114 Stat 1163A 153-54. Under that laws, OMB has guidelines on how agencies can maximize the quality, objectivity, utility, and integrity of information federal agencies disseminate. OMB requires agencies to permit persons to request correction of information maintained and disseminated by the agency that does not comply with OMB or agency guidelines, and to report annually to OMB on the complaints the agency receives. The notice says the CFPB’s report is available on its website but it is not yet posted. Comments are due September 4, 2012. * The Federal Reserve finalized a rule, replacing an interim final rule, permitting debit card issuers one cent per transaction if the issuer implements procedures to reduce the occurrence and cost of fraudulent electronic debit transactions. The rule is effective October 1, 2012.
The CFPB requests comment on how to improve financial literacy, and on its information quality * The Federal Reserve finalized a swipe fees rule permitting a penny per transaction for fraud prevention
THe Federal Reserve finalized a rule on risk management for systemically important financial market utilities it supervises.
The CFTC proposes clearing CDS and interest rate swaps * It proposes requiring filing trade and trader reports * The CFTC and SEC act on compliance dates
FSOC designated eight financial market utilities as systemically important * FSOC reported on contingent capital * FSOC and OFR released annual reports * FDIC and SEC replaced references to credit ratings
Updates include: * The CFPB’s proposed Know Before You Owe mortgage rule that would integrate the RESPA and TILA origination disclosures. * The CFPB’s five page summary of its KBYO proposed rule. * The CFPB’s proposed HOEPA rule and provided a summary of it.
The CFPB released a final rule defining larger participants of a market for consumer reporting, who are subject to CFPB supervision. * GAO released a report on the SEC’s efforts to come up with a conflicts minerals rule. The SEC will hold a meeting in August to consider whether to adopt a final rule.
Dodd-Frank Act Rulemakings,Studies, and Reports Update
* The CFTC issued a final order to extend with modifications a July 16, 2011 order to delay several statutory provisions that needed regulatory definitions that were not final.
Dodd-Frank Act Rulemakings,Studies,and Reports
* The CFTC posted its joint final rule with the SEC that further defines “swap,” “security-based swap,” and “security-based swap agreement.” * GAO released a report on progress in implementing orderly liquidation authority. The report summarizes the rulemakings to date, and states that the Administrative Office of the U.S. Courts and the Federal Judicial Center have begun a new effort to track financial company bankruptcies, but data are limited.
Dodd-Frank Act Rulemakings, Studies,and Reports
* The CFTC proposed an exemptive order to allow non-U.S. swap dealers and non-U.S. major swap participants to delay compliance with certain entity-level requirements. * The CFTC finalized a rule governing an end-user exception to the clearing requirement for a party that is not a financial entity * The CFTC proposed a rule that would permit certain cooperatives to elect not to submit certain swaps for clearing.
The OCC released an interim final rule that combines the OCC’s and OTS’s lending limits rules and that, effective January 1, 2013, applies lending limits to credit exposures arising from derivative transactions, repurchase agreements, reverse repurchase agreements, securities lending transactions, and securities borrowing transactions under § 610. Comments are due 45 days after Federal Register publication,
Dodd-Frank Act Rulemakings, Studies and Reports Update.
* The CFPB finalized three of four interim final rules it released in July 2011. * The CFPB published an interim final rule to implement the Equal Access to Justice Act, which awards attorneys’ fees to certain parties in agency actions. * The CFPB solicits comment that would assist the agency in fulfilling its mandate to facilitate the financial literacy of individuals aged 62 or older..... * The FDIC supplemented an earlier proposed rule to propose a clarification about the definition of “financial activities” .... * SEC solicits comment on the anticipated sequencing of the compliance dates of final Dodd-Frank rules. * The SEC announced the appointment of Thomas J. Butler as Director of the SEC’s new Office of Credit Ratings.
* The CFPB, FDIC. Federal Reserve, NCUA, and OCC released a memorandum of understanding (“MOU”) on supervisory coordination. It covers supervision of depository institutions with over $10 billion in assets and their affiliates (“covered institutions”). * The federal banking agencies released three proposed capital rules and FAQs. * The SEC solicits comment on a policy statement. * The SEC extended the compliance date for the ban on third-party solicitation, the “pay to play” rule
Dodd Frank Mortgage Rules-a new Roadmap document.
Rule Makings underway. Rule Making Required by Title XIV. Required or Possible Rules without a Deadline.
Working Document Updates.
* The CFPB proposed a rule setting the procedure by which the CFPB will notify nondepository institutions that they are subject to CFPB examination and supervision. After receiving written notice, the institution has 20 days, including weekends, to respond. The response must include all documents, records, or other evidence a respondent wishes to use to support its position. There is no discovery, but institutions may request an “oral response.”.... * The FSOC requested comment on hearing procedures for firms (“petitioners”) designated for Federal Reserve supervision and prudential standards. Petitioners may request written and oral hearings.
Updates include....The CFPB released its outline of proposals on mortgage loan originator qualifications and compensation....The federal banking agencies released joint guidance that § 716, which prohibits federal assistance to swaps entities.....Treasury reproposed a written determination to exempt foreign exchange swaps, foreign exchange forwards, or both, from the definition of swaps under the Commodity Exchange Act.
The CFTC proposed interpretive guidance regarding the § 728 confidentiality and indemnification provisions
Updates include: The CFPB released its outline of proposals on mortgage loan originator qualifications and compensation.....The federal banking agencies released joint guidance that § 716, which prohibits federal assistance to swaps entities, becomes effective on July 16, 2013......Treasury reproposed a written determination to exempt foreign exchange swaps, foreign exchange forwards, or both, from the definition of swaps under the Commodity Exchange Act.
The CFTC proposed interpretive guidance regarding the § 728 confidentiality and indemnification provisions, stating that they should not operate to inhibit or prevent foreign regulatory authorities from accessing confidential data reported to a swap data repository, if the authorities have an independent and sufficient regulatory interest. Comments are due June 6, 2012.
Updates include: The CFTC and SEC released a joint final rule and a joint interim final rule, and interpretations, that further define the terms “swap dealer,” “security-based swap dealer,”....The FDIC and Treasury finalized rules under § 210 that limit the amount of outstanding obligations that the FDIC may issue to the Treasury ....The FDIC finalized a rule that treats a mutual insurance holding company as an insurance company for purposes of § 203(e) of the Dodd-Frank Act
Updates include; The CFTC and SEC released a joint final rule and a joint interim final rule, and interpretations, that further define the terms “swap dealer,"....The FDIC and Treasury finalized rules under § 210 that limit the amount of outstanding obligations that the FDIC may issue to the Treasury.....The FDIC finalized a rule that treats a mutual insurance holding company as an insurance company for purposes of § 203(e) of the Dodd-Frank Act...The FFIEC Appraisal Subcommittee revised its rules ...
Dodd Frank working document updates.
The FTC rescinded nine rules that are now CFPB rules, effective April 13, 2012. The SEC announced the formation of an Investor Advisory Committee, under § 911, to advise the SEC on regulatory priorities, the regulation of securities products, trading strategies, fee structures, the effectiveness of disclosure, and on initiatives to protect investor interests and to promote investor confidence and the integrity of the securities marketplace
The Federal Reserve requested comment on a proposed amendment to a February 11, 2011 proposed rule to establish requirements for determining whether a company is “predominantly engaged in financial activities.”...The FSOC released a final rule describing how it will designate institutions for Federal Reserve supervision... The FSOC also finalized its FOIA rule.
Highlights include: The CFPB proposed a regulation that states information submitted to the CFPB for supervisory or regulatory purposes does not waive any privilege..... The CFPB extended the reply comment period on its notice that it is streamlining its inherited regulations.... The Federal Reserve Board extended the comment period on its proposed rule to implement enhanced prudential standards...
The CFPB published its inherited EFTA rule...... The Federal Reserve, FDIC, OCC, and SEC extended... The Federal Reserve finalized a requirement that savings.... The SEC finalized a rule that requires disclosures.... The SEC extended the expiration date of interim....
The CFPB announced it has established.... The CFTC finalized a rule removign references.... The OCC released a bulletin describing the process..
Working document udpates.
Highlights include: The CFPB released a report on credit card complaints and proposed policy....
Highlights include: OCC proposed rule and guidance to remove references to credit ratings in regulations...
Highlights include: Federal Reserve finalized a rule that requires bank holding companies to submit capital plans...National Retail Federation and others sued the Federal Reserve.
Highlights include: THE CFPB, Federal Reserve,FDIC, NCUA and OCC publish a statement on how and when they will determine the total assests of depository institutions.
Highlights include: GAO report entitled, Dodd-Frank Act Regulations: Implementations could benefit from Additional Analyses and Coordination.
Highlights updates include: The CFPB released Round 6 prototypes for it "Know Before you Owe".
Document updates incude: CFPB publishes a Paperwork Reduction notice...SEC rules for registered investment advisers...
Highlights include: The CFPB launches a Know Before you Owe project for student loans.....CFTC finalies a reul that sets position limits on 28 physical communodity futures.
Working document updates
Highlights include: CFPB releases its Supervision and Examination Manual....FIO solicits comments for a study on hot to moderniae and improve insurance regs....Federal Reserve requires bank holding companies with assets of $50 billion or more.....
Highlights include: SEC proposed a rule under§764 that sets out a process by which security based swap dealers and participants must register with the SEC....SEC approved the proposed Volcker rule.....FDIC finalized a rule that they will not enforce the OTS FOIA....
Working documents update
Highlights include: FSOC proposed a regulation and guidance on the procedure the FSOC would follow.....three state process....$30 billion in gross national CDS...leverage ration of total consolidated assets to total equity....
Updates for 09.22.11
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