Archives: Bank Regulation

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Pennsylvania Department of Banking and Securities Publishes Proposed Assessment Regulation

On September 14, 2013, the Pennsylvania Department of Banking and Securities (“DOBS”) published a notice of proposed rulemaking in the Pennsylvania Bulletin to implement an updated assessment schedule for Pennsylvania state-chartered financial institutions, trust companies and credit unions. 43 Pa.B. 5455. The Department of Banking and Securities Code, 71 P.S. 733-101 et seq., provides the … Continue Reading

N.J. Appellate Court Affirms Trial Court Decision that a Borrower was not Entitled to a HAMP Mortgage Loan Modification Based Solely on Participation in a Trial Period Plan

This post was written by Kenneth M. Kolaski. The Appellate Division of the New Jersey Superior Court recently decided the case of Marra v. Wells Fargo Bank, N.A., No. A-5747-11T2, which concerned modifications of residential mortgage loans. This case gives us insight as to the factors courts will consider to determine when a borrower is … Continue Reading

Pennsylvania Mortgage Licensing Act Bill Advances

In April 2013, Representative Scavello (R. Monroe County) and others introduced HB 1124, which would amend the Mortgage Licensing Act (“MLA”), 7 Pa. C.S. 6101 et seq. HB 1124 was passed by the House on April 24, 2013 and is currently with the Senate. The bill has the support of the Department of Banking and … Continue Reading

Legal Intelligencer Features Reed Smith Analysis of Pennsylvania Bank Legislation

Recently, The Legal Intelligencer featured an in-depth analysis by FSRG members Michael Bleier, Len Bernstein and Lauren Abbott regarding important changes in Pennsylvania banking laws. Dubbed the “banking modernization legislation,” these new laws address a variety of issues in Pennsylvania banking, including greatly expanding the regulatory and enforcement tools available to the Pennsylvania Department of … Continue Reading

FFIEC Proposes Bank Social Media Risk Management Guidelines

Our colleagues, Timothy J. Nagle, John P. Feldman, and Frederick Lah, recently wrote about a proposed guidance released by the Federal Financial Institutions Examination Council (“FFIEC”) earlier this week requesting comment on the applicability of consumer protection laws to the social media activities of financial institutions. The guidance, which can be viewed here, discusses the potential risks associated … Continue Reading

Pennsylvania’s Banking Modernization Package Now in Effect

On December 24, 2012, three bills, H.B. 2368, H.B. 2369, and H.B. 2370, became effective. These new laws greatly expand the regulatory and enforcement tools available to the Pennsylvania Department of Banking and Securities (“Department”), bringing Pennsylvania law into compliance with the Dodd-Frank Act and modernize, where necessary, Pennsylvania’s Banking Code. As a result of … Continue Reading

Federal Reserve Proposes Rules on Enhanced Prudential Standards and Early Remediation for Foreign Banking Organizations and Certain Foreign Nonbank Financial Companies

Friday afternoon, the Federal Reserve Board (“Board”) considered and approved in an open board meeting, proposed rules to implement the enhanced prudential standards and early remediation requirements of sections 165 and 166 of the Dodd-Frank Act for foreign banking organizations (“FBOs”), and those foreign nonbank financial companies designated by the Financial Stability Oversight Council for … Continue Reading

States’ Inaction on Derivatives May Send State-Chartered Banks Over a Risk Management Cliff

This posting was also written by Andrew P. Cross. Effective January 21, 2013, state-chartered banks will be prohibited from entering into interest rate swaps or other over-the-counter derivatives, unless authorized by their chartering state. This impending precipice is due to Section 611 of the Dodd-Frank Act which permits state-chartered banks to engage in derivative activities … Continue Reading

CFPB Regulatory Onslaught: Now is the Time to Comment

The Consumer Financial Protection Bureau ("CFPB") has been on a tear lately, putting out regulatory proposals seemingly on a weekly basis. In each proposal, it has requested comments from interested parties, and, based on what CFPB representatives indicated at the Mortgage Bankers Association's recent Regulatory Compliance Conference in Washington, D.C., which I attended, the CFPB is truly interested in what the public has to say about its residential mortgage-related proposals. So, unless you prefer to sit back and allow the CFPB to make decisions concerning your business without any input from you, or you have already provided input, now is the time to review the CFPB's proposals and submit comments.… Continue Reading

Reed Smith Comments on the CFPB’s First Enforcement Action and Subsequent Regulatory Bulletin

Our Financial Services Regulatory Group’s own Bill Mutterperl recently commented on the CFBP’s first enforcement action against Capital One Financial Corporation and the regulatory bulletin that was subsequently issued as a result of a $210 settlement reached between Capital One and the CFPB, along with other federal regulators. In looking at the implications of this … Continue Reading

U.S. Supreme Court Punts in First American v. Edwards

After agreeing to hear First American Financial Corp.’s appeal of an unfavorable decision by the Ninth Circuit Court of Appeals; reviewing the parties’ opposing briefs and the numerous amicus briefs that were submitted; questioning the parties at length during a spirited oral argument conducted in November 2011; and ruminating for more than seven months on … Continue Reading

Bloomberg BNA’s Banking Report Features Michael E. Bleier and Travis P. Nelson

As featured in Bloomberg BNA’s Banking Report, Michael E. Bleier and I recently wrote about the Federal Reserve Board’s release of three orders approving investments in the U.S. Banking market by entities based in China. To read the entire publication, please click on the following link:  Fed Opens the Door to Increased Chinese Investment in U.S. … Continue Reading

One More Thing for Mortgage Originators to Worry About: New AML/SAR Requirements

On February 14, 2012, the Financial Crisis Enforcement Network ("FinCEN") published new rules requiring non-bank residential mortgage lenders and originators ("RMLOs") to: (i) establish and implement anti-money laundering ("AML") programs; and (ii) file suspicious activity reports ("SARs") and keep records pertaining to such reports. These are the same requirements to which banks have long been subject.… Continue Reading

CFPB Seeks Comment on Regulation of Reloadable Prepaid Cards

The Consumer Financial Protection Bureau ("CFPB") announced May 24, 2012, that it was seeking comments from the public on an Advance Notice of Proposed Rulemaking ("Notice") regarding general purpose reloadable prepaid cards ("GPR cards"). The CFPB described a GPR card as a product that is "issued for a set amount in an exchange for payment made by a consumer" and to which a consumer can add funds. GPR cards can also be in the form of a key fob or cell phone application.… Continue Reading

Fed Opens the Door to Increased Chinese Investment in U.S. Banking Organizations

On May 9, 2012, the Federal Reserve Board (“FRB”) released three orders approving investments in the U.S. banking market by entities based in China. The investments, which consist of the acquisition of 80 percent of a national banking association and the establishment of two foreign branch offices, are particularly notable because the investments are coming … Continue Reading

Volcker Rule Status Update

Section 619 of the Dodd-Frank Act ("Act"), otherwise known as the "Volcker Rule (the "Rule")," contains some of the most wide-sweeping and controversial provisions of the entire law. Basically, the Rule places restrictions on the proprietary trading and investment activities of insured depositories and their affiliates and subsidiaries. The purpose of this blog post, however, is not to analyze the content of section 619 and the proposed authorizing regulations. There has already been, and there necessarily will be, a great deal more said along those lines. Rather, in light of the complexity of the subject matter and the significance of the process associated with developing a final rule, this post intends to hit a more narrow target: to help the reader understand the timing and process for the finalization of the rule.… Continue Reading

Federal Reserve Board Confirms Template for Financial Stability Test: Board’s Way or the Highway

On February 14, 2012, the Federal Reserve Board (“Board”) announced its approval of Capital One Financial Corporation (“Capital One”) to acquire the shares of ING Bank, fsb (“ING”). In its order approving the acquisition, the Board reaffirmed its test for determining financial stability in light of the new criteria required by Dodd-Frank to the analysis … Continue Reading

Fed Extends Comment Period on Enhanced Prudential Standards Rule

On January 5, 2012, the Federal Reserve Board (“FRB”) published in the Federal Register a notice of proposed rulemaking (77 Fed. Reg. 594 (Jan. 5, 2012)) that would implement the enhanced prudential standards required to be established under Section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), and the … Continue Reading

Senator Whitehouse Proposes to Repeal Interest Rate Exportation

On November 8, 2011, Senator Whitehouse of Rhode Island introduced S. 1829, titled the “Empowering States’ Rights To Protect Consumers Act.”  The bill proposes to add a single sentence to the Truth in Lending Act, to wit: Notwithstanding any other provision of law, the annual percentage rate applicable to any consumer credit transaction (other than … Continue Reading

Implications of Basel III

While the focus of in-house counsel has appropriately been on the Dodd Frank Act and its avalanche of required rulemakings, a probably more impactful set of requirements are going to come from the Basel III capital and liquidity rules.  As a result of the financial crisis of the past few years, the Basel Committee on … Continue Reading

Information Gathering by Retailers Curtailed by California Court

On February 10, 2011, the Supreme Court of California issued an order overturning two prior appellate court decisions that had permitted retailers in California to request and store zip codes of card holders at the time of sale under the Credit Card Act of 1971 (the “CA Credit Card Act”) (Cal. Civ. Code 1747 et … Continue Reading

House Proposes Financial Privacy Information Act of 2011

Last month, Rep. Jackie Speier (D-CA), introduced H.R. 653 (pdf), the “Financial Privacy Information Act of 2011” (the “Bill”).  The Bill was referred to the House Financial Services Committee (the “Committee”).  The Bill would change current law to require financial institutions to obtain consent prior to sharing any information with third parties.  In other words, the Bill … Continue Reading