Insights

PH FedACTion: Financial Regulatory Updates

Daily Financial Regulation Update -- Saturday, December 11, 2021

December 11, 2021

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Congress

Click here to view the full text of the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act"), Enacted March 27, 2020.

Click here to view the full text of the Paycheck Protection Program Increase Act of 2020, Enacted April 24, 2020.

Click here to view the full text of the Paycheck Protection Program Flexibility Act of 2020, Enacted June 5, 2020.

Click here to view the full text of the Consolidated Appropriations Act, 2021, Enacted December 27, 2020.

Click here to view the full text of the American Rescue Plan of 2021, Enacted March 11, 2021.

Click here to view the full text of the PPP Extension Act of 2021, Enacted March 30, 2021.

Click here to view a running list of proposed legislation from the Senate Committee on Banking, Housing, and Urban Affairs, Senate Committee on Small Business and Entrepreneurship, House Committee on Financial Services, and House Committee on Small Business.

U.S. Senate

Senators Comment on FDIC Possible Guidance on Mergers

December 10, 2021

Senator Sherrod Brown (D-OH), Chair of the Senate Committee on Banking, Housing, and Urban Affairs and Patrick Toomey (R-PA), issued statements in response to a purported Federal Deposit Insurance Corporation Board voted to publish a request for information about the bank merger process.

Chair Brown Statement
Ranking Senator Toomey Statement

U.S. House of Representatives

Committee on Financial Services

Congresswoman Waters Calls on Fed, FDIC, and OCC to Halt Mergers and Acquisitions Over $100 Billion

December 10, 2021

Following recent news from the Chair of the Board of Governors of the Federal Reserve System (Fed) and the Federal Deposit Insurance Corporation (FDIC) Board that they are conducting reviews to update their bank merger and acquisition (M&A) approval procedures, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, sent a letter to Jerome Powell, Chair of the Fed; Jelena McWilliams, Chairman of the FDIC; and Michael Hsu, Acting Comptroller of the Office of the Comptroller of the Currency (OCC), affirming the importance of the reviews and urging their agencies to impose a moratorium on approving any large bank M&A over $100 billion while the reviews take place.

Federal Agencies

Federal Reserve Board

Federal Reserve Board Reiterates its Supervisory Expectations for Large Banks' Risk Management with Investment Funds

December 10, 2021

The Board of Governors of the Federal Reserve System reiterated its supervisory expectations for large banks' risk management with investment funds. The supervisory message follows a review by the Board of the default and failure of Archegos Capital Management, a concentrated and leveraged fund.

Federal Deposit Insurance Corporation

The Federal Deposit Insurance Corporation Issued a Statement Regarding a Statement by the Consumer Financial Protection Bureau Concerning Bank Mergers

December 9, 2021

The Federal Deposit Insurance Corporation (FDIC) issued a statement in response to the Consumer Financial Protection Bureau posting on its website a document, purportedly approved by the FDIC Board, requesting comment on bank mergers. The FDIC statement clarified that no such document has been approved by the FDIC.

Office of the Comptroller of the Currency

OCC Reports Improvement in Mortgage Performance

December 10, 2021

The Office of the Comptroller of the Currency (OCC) reported that the performance of first-lien mortgages in the federal banking system improved during the third quarter of 2021. The OCC Mortgage Metrics Report, Third Quarter 2021 showed that 95.6% of mortgages included in the report were current and performing at the end of the third quarter of 2021 compared to 92.5% at the end of the third quarter of 2020.

Revised Comptroller's Licensing Manual Booklets

December 10, 2021

The Office of the Comptroller of the Currency (OCC) announced that it issued the "Background Investigations," "Capital and Dividends," "Charters," "Conversions to Federal Charter," and "National Bank Director Waivers" booklets of the Comptroller's Licensing Manual. The revised booklets replace booklets of the same title issued between April 2017 and October 2019.

Securities and Exchange Commission

Rat Farms and Rule Comments - Statement on Comment Period Lengths

December 10, 2021

U.S. Securities and Exchange Commission Commissioner Hester M. Peirce released a statement titled "Rat Farms and Rule Comments – Statement on Comment Period Lengths."

Commissioner Peirce Statement

Financial Stability Oversight Council

Council Meetings

December 10, 2021

On December 17, 2021, U.S. Secretary of the Treasury Janet L. Yellen will preside over a meeting of the Financial Stability Oversight Council (Council) by videoconference. The agenda will include both an open and an executive session. The preliminary agenda for the open session includes a vote on the Council's 2021 annual report; a vote on establishing a staff-level Climate-related Financial Risk Committee of the Council; and the transition from LIBOR. The preliminary agenda for the executive session includes forthcoming proposed SEC rulemakings; the crypto-asset policy sprint by the federal banking agencies; and the Council's climate-related work.

Announcement

FINRA

Charitable Donations for Conservation: Are Investor Returns Beyond Belief?

December 10, 2021

The Financial Industry Regulatory Authority released an Investor Insights regarding syndicated conservation easements (SCETs), which are a common type of charitable conservation contribution. SCETs top the 2021 "Dirty Dozen" list of tax scams published by the Internal Revenue Service in July 2021.

Investor Alert

Bank Policy Institute

BPI Statement on Purported FDIC's Attempt to Request Information Regarding Bank Merger Transactions

December 10, 2021

Greg Baer, President and CEO of the Bank Policy Institute, issued a statement in reaction to a statement by two members of the Federal Deposit Insurance Corporation's Board of Directors.

Statement

BPI Supports CFPB Resolve to Verify Big Tech Consumer & Data Safeguards

December 10, 2021

The Bank Policy Institute responded to a Consumer Financial Protection Bureau request for comment issued following a series of orders calling on Big Tech companies that offer payments services to provide information on how collected financial data is used, and whether that data is adequately protected under existing business practices. The orders recognize that while Big Tech companies are eager to push the envelope and expand their product offerings, these activities could threaten consumers and a competitive marketplace if left unchecked.

International

European Banking Authority

EBA Consults on New Remote Customer Onboarding Guidelines

December 10, 2021

The European Banking Authority (EBA) launched a public consultation on its draft Guidelines on the use of remote customer onboarding solutions. The Guidelines set out a common understanding by competent authorities of the steps financial sector operators should take to ensure safe and effective remote customer onboarding practices in line with applicable anti-money laundering and countering the financing of terrorism legislation and the European Union's data protection framework. Once adopted, the Guidelines will apply to all financial sector operators that are within the scope of the Anti-money Laundering Directive. The consultation runs until March 10, 2022.

EBA Consults on Liquidity Requirements for Investment Firms

December 10, 2021

The European Banking Authority (EBA) launched a public consultation on its draft Regulatory Technical Standards (RTS) on specific liquidity measurement requirements for investment firms and draft Guidelines on liquidity requirements exemptions for small and non-interconnected investment firms. The draft RTS and draft Guidelines aim to ensure consistent supervisory practices with regards to the application of liquidity requirements for investment firms across all European Union Member States. The consultations run until March 10, 2022.

Bank of England

Paper: An Unintended Consequence of Holding Dollar Assets

December 10, 2021

The Bank of England released a Staff Working Paper titled "An Unintended Consequence of Holding Dollar Assets."

Staff Working Paper

Bank of England Prudential Regulation Authority

Joint Letter to Banks Operating in the UK: Supervisory Review of Global Equity Finance Businesses following the Default of Archegos Capital Management

December 10, 2021

The Bank of England Prudential Regulation Authority and the Financial Conduct Authority issued a joint letter to banks operating in the UK on the supervisory review of global equity finance businesses following the default of Archegos Capital Management.