Ohio Bankers League by jolinmilioncherie

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									Details Matter
OBL Regulatory Reform Bill
Tele-Briefing
With Jeffrey D. Quayle,
OBL SVP & General Counsel
CFPB
Powers and Purpose
- Purpose
  CFPB is to implement and enforce Federal
  consumer financial laws to ensure that
  markets for consumer financial products and
  services are fair, transparent, and competitive.

- Authority
  Authorized to administer, enforce, and
  implement Federal consumer financial law.
  The Bureau is required to monitor risks to
  consumers in the offering or provision of
  consumer financial products or services.
CFPB
Statutes
- Electronic Funds Transfer Act;
- Truth in Lending;
- The Equal Credit Opportunity Act;
- The Fair Credit Billing Act;
- Fair Debt Collection Practices Act;
- Home Owners Protection Act;
- Home Mortgage Disclosure Act;
- Privacy Provisions of GLB;
- Real Estate Settlement Procedures Act;
- Home Owners and Equity Protection Act
- Consumer Leasing Act of 1976;
- SAFE Mortgage Licensing Act; and
- The Alternative Mortgage Transaction Parity Act
  of 1982.
CFPB
Jurisdiction
CFPB has jurisdiction over covered persons that
offer or provides a consumer financial product or
service:
- Extending credit and servicing loans;
- Providing real estate settlement services
- Deposit taking activities;
- Transmitting or exchanging funds, or acting as a
  custodian;
- Selling or providing stored value or payment
  instruments;
CFPB
Jurisdiction
CFPB has jurisdiction over covered persons that
offer or provides a consumer financial product or
service:
- Providing payment or data processing services;
- Providing investment advisory services;
- Providing consumer reports;
- Collecting a consumer debt; AND
- Any other product or service as may be defined
  by the CFPB.
CFPB
-Supervision of Very Large Banks, Savings
 Associations, and Credit Union

- Other Banks, Savings Associations, and
  Credit Unions

- Supervision of Non-depository Covered
  Persons - Optional

- Specific Bureau Authorities

- Process & Procedure
New Disclosure &
Reporting Requirements
   - Expanded HMDA Data Collection
     New and additional HMDA reporting
     for all depository institutions.

   - Small Business Loan Data Collection
     New data collection provision for small
     business lending; intended to facilitate
     enforcement of fair lending laws and
     to enable regulators and the public to
     identify business and community
     development needs of women-owned,
     minority-owned, and small businesses.
New Disclosure &
Reporting Requirements
General Data Collection Authority

- CFPB may collect information regarding the
  organization, business conduct, markets and
  activities of banks and other covered persons
  through consumer surveys, interviews with
  covered persons, and required filings by
  covered persons and service providers.
Deposit Insurance
  New Premium Calculation:
  Total assets-Tier One Equity

         1. Total bank deposits will increase
            As the price goes up more deposits
            attracted compared to other savings
            /investment options, lowering the
            reserve ratio.

         2. The competition for core deposits
            will increase: Cost of FHLB advances
            & borrowings just became more
            expensive.
Deposit Insurance
Other Changes
       - New protection up to $250,000
         Retroactive until Jan. 1, 2008
         …Windfall!

       - Transaction Account Guarantee Program
         Extended for two years and becomes
         mandatory.

       - Larger, more robust DIF
          - Minimum reserve goes up to 1.35%
          - Large banks bear the expense
          - All caps are removed
Mortgage Lending
New Consumer Protections
      - Prohibits “Steering” Payments/Yield
        Spread Premiums
       - Establishes “Ability to Pay” Standards
       - Limits Mortgage Refinancing
       - Safe Harbor
       - Prepayment Penalties
       - Additional Limitations
       - Creates Foreclosure Defense
       - New Definition for High Cost Mortgages
       - Other Mortgage Provisions
Mortgage Lending
 Origination and Securitization

        - General Principals

        - Exemption for Qualified Mortgages
Preemption & Expanded Role of
State Attorneys General
 State consumer protection law preempted in any of the
 following circumstances:

 1. A state law discriminates against a national bank or
    federal savings association;

 2. A provision of state law is preempted by a provision of
    federal law not in the National Bank Act;

 3. In accordance with Barnett Bank v. Nelson, the State
    law "prevents or significantly interferes" with the
    exercise of a national bank or federal thrift of its
    powers.
Preemption & Expanded Role
of State Attorneys General
New Standard for Judicial Review
- Court will assess the validity of the preemption
  determination.

- The court may not uphold a determination to
  preempt a State law unless it finds that the
  determination is supported by substantial
  evidence.

- Bill overturns existing case law that extends
  preemption protection to national bank
  operating subsidiaries.
Preemption & Expanded Role
of State Attorneys General
New Authority

- A State Attorney General may bring an action in
  Federal District Court or State court to enforce
  the consumer protection provisions including
  regulations issued by the CFP.B

- May also bring an action to enforce any other
  applicable state or federal law against a
  national bank or federal savings association.
What Else Will Impact Your
Bottom Line?
- Payment of Interest on Business Checking
  Accounts

- New Limitations on Interchange Fees

       - Fed to set “reasonable and
         proportional (fees) to the cost
         incurred by the issuer with respect to
         the transaction.”

       - Costs not specific to a particular
         electronic debit transaction will not be
         considered in whether a charge is
         reasonable and proportional.
What Else Will Impact Your
Bottom Line?
New Limitations on Interchange Fees

      - Exemptions

      - Miscellaneous Limitations
Questions?
Details Matter
OBL Regulatory Reform Bill
Tele-Briefing

								
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