Roundtable Executive Summary Bulletin May 6, 2011LEGISLATIONMark-up: CFPBThe House Financial Services Financial Institutions Subcommittee today marked-up three bills toamend the powers of the Consumer Financial Protection Bureau. All three bills passed on aparty-line vote, and are scheduled for Full Committee consideration next week on Thursday, May12th. Two amendments to H.R. 1121 submitted by Reps. Maloney (D-NY) and Velazquez (D-NY)failed. The Roundtable supports the passage of these important bills.The bills would: - Replace the bureau’s independent director position with a five-member commission (H.R. 1121 – Bachus). - Delay the full transfer of powers to the CFPB until a Director is in place (H.R. 1667 – Capito). - Allow the FSOC to veto rules written by the CFPB on a simple majority, while using a review standard that finds that the rule is “inconsistent with the safe and sound operations of United States financial institutions” (H.R. 1315 – Duffy).[Scott Talbott, Scott@fsround.org].REGULATORYRoundtable Submits Comment on FDIC Brokered Deposits StudyThis week the Roundtable filed comments responding to the FDIC’s study on Brokered Depositsas mandated by Section 1506 of the Dodd-Frank. A link to the final letter is available here. TheRoundtable believes that the Study should address five key issues: 1. The Study should recognize the relationship between brokered deposits and the FDIC’s DIF assessment system. 2. The Study should recognize that in certain respects, the FDIC has ample flexibility as to how it can address the issue of brokered deposits. 3. The Study should recognize that brokered deposits may be re-classified based on the duration of the account relationship. 4. The Study should clarify that deposit funding that is “sticky” should not be treated as brokered deposits. “Stickiness” of a deposit can be demonstrated by (i) the aggregate average duration of the account relationship; (ii) the duration of the individual account relationship; and (iii) the amount of time that the funds have been deposited with the IDI (e.g., once a deposit has stayed with an IDI for a year, it should no longer be viewed as brokered). 5. The Study should recognize the stability of brokered deposits that arise from established referral relationships.[Brian Tate, Brian@fsround.org or, Brad Ipema, Brad.Ipema@fsround.org.]
Roundtable Swaps Groups Remains Active in Multiple Areas Regarding Title VII of Dodd-FrankThe Roundtable’s Swaps Working group continues to prepare comment letters on the followingtopics: • Rationale and order for rulemakings under Title VII of the Dodd-Frank Act • Problems with the CFTC’s proposal on required swaps documentation for swap dealers and major swap participants • Proposal by Prudential Regulators on margin requirements for swap transactions • Proposal from the CFTC on margin requirements for swap transactions • The Proposed Exemption of Forex Swaps and Forwards from CFTC RegulationThe Roundtable is also reviewing a joint SEC/CFTC notice of proposed rulemaking (NPR) onwhich swap products will be regulated under Title VII. The Roundtable is also preparing asummary of a two day roundtable meeting held by the CFTC and SEC on May 2-3 on Title VIIImplementation. The Swaps Working Group also continues to receive updates on H.R. 1573, abill pending in Congress that would allow regulators more time to institute the systems requiredunder Title VII of Dodd-Frank. [Robert Hatch, Robert@fsround.org.]For More Regulatory Updates, Check this Week’s “Rules in Focus” MemorandumFor the latest updates on the Roundtable’s regulatory efforts, please consult the Roundtable’sweekly “Rules in Focus” publication. Past editions of the publication are available here.[Robert Hatch, Robert@fsround.org.]HOUSINGHousing Policy Council Comments on TILA/RESPA HarmonizationOn May 5th, the Housing Policy Council and the Financial Services Roundtable submitted acomment letter on the Department of Treasury and Consumer Financial Protection Bureau’ssubmission to the Office of Management and Budget on the qualitative testing of integratedmortgage loan disclosure forms. In the comment letter, we state that the model form needs to beflexible for different products, the Bureau must consider issues posed by mandated redisclosures,the bureau should engage with compliance experts early in this process, and the Bureau shouldreach a broad audience in testing. The final letter can be found here. [Paul Leonard,Paul@fsround.org]HOPE LoanPort® UpdateHOPE LoanPort® continues to grow, expanding non-profit counselor participation as part of theongoing effort to reach homeowners looking to avoid foreclosure. Over 500 counseling agencieswith over 2,300 counselors, in 46 states, the District of Columbia, are using the portal to submitcomplete loan modification applications directly to mortgage servicers. On average it takes about21 days for a counselor to submit a complete application in HOPE LoanPort®, and 26 days toapprove, or 11 days to deny a loss mitigation application. Servicer partners represent more than80% of the total mortgage market. There are currently more than 800 servicer users serving as a"single point of contact" that are using HOPE LoanPort®.Next week HUD is sponsoring a HOPE LoanPort Training session on Tuesday, May 10th for allcounselors across the country. HOPE LoanPort will also be presenting at NeighborWorks®Americas National Training Institute in Detroit, MI on May 17, 2011. [Brad Dwin, (202) 589-1938,Bdwin@hopeloanportal.org]
TECHNOLOGY2011 FS-ISAC & BITS Annual SummitAt the FS-ISAC & BITS Annual Summit, May 2-4 in Miami, 500 financial services, technology, riskmanagement and security professionals convened to discuss the highly dynamic cybersecuritylandscape and industry-wide efforts to improve resilience. Stakeholders exchanged informationand strategies for understanding and mitigating cyber threats, securing email, using social mediaand meeting the challenges of data security, data sprawl and data breaches, among other topics.BITS moderated panels on the regulatory environment and securing the internet. [Ann Patterson,Ann@fsround.org].Financial Top Level Domains (.bank/.insure/.invest)ICANN and its Governmental Advisory Committee continue to narrow their disagreement in areasof trademark protection, objection processes and the treatment of regulated and sensitive strings,in anticipation of a June 20 vote on gTLD expansion. BITS, ABA and Verisign are refining ananalysis of the financial domain options and will begin to tally institutions interest in May. [LeighWilliams, Leigh@fsround.org].Hearing: ICANN gTLD OversightOn May 4, the US House Subcommittee on Intellectual Property, Competition and the Internethearing on "ICANN generic Top-Level Domains (gTLD) Oversight” focused on the Who-isdatabase. While there was support for gTLD expansion, delaying ICANN’s June 20 vote on gTLDexpansion was recommended until trademark safeguards are in place. Witnesses: Kurt Pritz,SVP, Stakeholder Relations ICANN; Mei-lan Stark, SVP, Intellectual Property, Fox Group LegalTreasurer, International Trademark Association (INTA); Michael Palage, President and CEOPharos Global; Steven Metalitz, Counsel Coalition for Online Accountability; Steve DelBianco,Executive Director NetChoice; and Joshua Bourne, President Coalition Against Domain NameAbuse (CADNA). [Leigh Williams, Leigh@fsround.org].Sony Breach InformationOn May 4, the FS-ISAC and BITS released additional information regarding the Sony breach,including an incident overview and recommended next steps for institutions. [Andrew Kennedy,Andrew@fsround.org].RESEARCH Did you know that the CFPB currently has over 200 employees?An organizational chart of the CFPB is in this weeks fast facts, posted here.[Abby McCloskey, Abby@fsround.org]INSURANCEAgents for Change Advocacy EffortsThe sixth annual Agents for Change legislative conference will be held May 10-12 in Washington,DC. Attendees will hear from high level guest speakers, network with peers, and enjoy privatetours of Washington, D.C. landmarks including the United States Capitol.Additionally, members of Agents for Change will be meeting with Rep. Hansen Clarke in Detroit,MI on May 17 and Rep. Peter Roskam in Bloomingdale, IL on June 6. [Peter Ludgin, 202-589-1929]
COMMUNITY SERVICEFinancial Literacy Month OverviewWhile National Financial Literacy Month has officially ended, the effort to strengthen Americasfinancial literacy continues. Click here for a review of the financial services industry’s impact incommunities and a look ahead. [Aleksia Ilic, Aleksia@fsround.org]Community Service in the News • San Francisco Mayor Edwin Lee and Oakland Mayor Jean Quan Kick Off Forum on Earthquake Risk, May 2, 2011 • Citi-Funded Study Finds If One in Three Microenterprises Hired One Employee, U.S. Economy Would Reach Full Employment, May 2, 2011Roundtable Awards University of Scranton Student with Foundation ScholarshipThe Financial Services Roundtable announced that Robert Della Polla of the University ofScranton is the recipient of the 2011 Roundtable Financial Scholarship in honor of Christopher M.Condron, Retired Chairman, AXA Equitable. Della Polla will be entering his junior year as anaccounting major at the University of Scranton in the fall of 2011. Read more.Community Service 2011 Company of the Week: CitiWeek of May 1, 2011 Citi Celebrates Small Business Month From left, Bob Annibale, Citi’s Global Head of Microfinance and Community Development; Rob Walsh, Commissioner NYC Department of Small Business Solutions; Vikram Pandit, CEO Citi; and Gina Harman, CEO ACCION USA.Citi’s commitment to Responsible Finance reflects our understanding of the central role offinancial products and services in expanding financial inclusion and community development.With particular emphasis on underserved families and communities, we have a continuing, corefocus on neighborhood revitalization, financial capability and asset building, college completionand, importantly, small business development. Small businesses are key engines of any localeconomy and are critical to creating jobs. Read more. [Aleksia Ilic, Aleksia@fsround.org].
The mission of The Financial Services Roundtable is to protect and promote the economic vitality and integrity of its members and the United States financial system. www.fsround.org