Top Ten Stories in Regulation and Reform in 2012

The presidential election dominated Washington this year, but other issues also sparked controversy, including pending Basel III rules, Sheila Bair's book, and an FDIC attempt to redefine community banks. Following are the most read stories in Reg and Reform this past year, counting down from #10 to #1.

(Image: Bloomberg News)
#10 - OCC Details Litany of Risks Facing Banks #10 - OCC Details Litany of Risks Facing Banks It's rare that a report is that exciting, but the OCC's Semiannual Risk Review was unique. It offered a comprehensive list of all the threats facing banks, and unlike most regulatory reports, didn't pull its punches. The report warned that banks were under pressure to lower underwriting standards, offer new, potentially dangerous products and ignore operational risk.

(Image: Bloomberg News)
# 9 -- Warren Wins Senate Seat; Likely to Play Key Role on Banking Issues # 9 -- Warren Wins Senate Seat; Likely to Play Key Role on Banking Issues If there was a Public Enemy No. 1 for many bankers this year, it was Elizabeth Warren. The founder of the Consumer Financial Protection Bureau ran for Senate in Massachusetts-and bankers poured thousands of dollars into trying to help her opponent, Sen. Scott Brown, keep his seat. Ultimately, both Brown and bankers failed, and Sen.-elect Warren is poised to have a big impact on the banking industry next year and beyond.

(Image: Bloomberg News)
#8 -- Was Williams Forced Out of the OCC? #8 -- Was Williams Forced Out of the OCC? Among the year's bigger shockers was the sudden departure of the Office of the Comptroller of the Currency's No. 2, Julie Williams. She has been a dominant force at the agency for 19 years, serving four comptrollers, yet the agency never offered an official explanation for her exit. Why? Because new Comptroller Tom Curry effectively forced Williams out in part due to administration and consumer group anger over the OCC's preemption rules, which Williams played a key role in writing.

(Image: Bloomberg News)
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#7 -- FDIC Seeks New Definition of Community Bank #7 -- FDIC Seeks New Definition of Community Bank The definition of community bank has remained static for years, focusing mostly on an institution's size. But in the Federal Deposit Insurance Corp.'s ambitious study of the small banks - the results of which were reported earlier this month - the agency narrowed in on other characteristics, like a small geographic focus and high amounts of loans and core deposits.

(Image: Bloomberg News)
#6 -- Four Key Takeaways for Banks from the CFPB's First Enforcement Action #6 -- Four Key Takeaways for Banks from the CFPB's First Enforcement Action The CFPB's $210 million enforcement action against Capital One in July differed from most other regulatory orders in several important ways, including the sheer size of the fine, its candid disclosure of facts and its proscriptive approach. As we predicted, the fine set a benchmark for more to come.

(Image: Bloomberg News)
#5 -- Seven Explosive Details from Bair's New Book #5 -- Seven Explosive Details from Bair's New Book Sheila Bair's nearly 400-page "Bull By the Horns" was filled with juicy details about behind the scenes moves by regulators before, during and after the financial crisis. Among the most blockbuster were her claims that Treasury Secretary Tim Geithner knew that the government's mortgage modification plan was doomed to fail - and didn't care. She also detailed why the government should have led Citigroup "to the pillory."

(Image: Bloomberg News)
#4 -- Community Banks: Basel III Will Put Us Out of Business #4 -- Community Banks: Basel III Will Put Us Out of Business

Hundreds of community banks across the country protested the federal regulators proposal to implement Basel III capital and liquidity rules. Their chief complaint wasn't the proposed capital ratio of 7% Tier 1 capital, but how the plan would change risk-weightings on certain assets. Many warned that if the final rule applies to them, it will push them out of business.

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#3 -- Bankers Form SuperPac for Surgical Strike at Industry's Enemies #3 -- Bankers Form SuperPac for Surgical Strike at Industry's Enemies

Frustrated by a lack of political power and fed up with blindly donating to politicians who consistently vote against the industry's interests, a handful of leaders created the industry's first SuperPac dubbed Friends of Traditional Banking, which was designed to target banks' enemies and support their friends.

#2 -- What Obama Victory Means for Banks #2 -- What Obama Victory Means for Banks President Barack Obama's re-election victory was a big blow for bankers that had overwhelmingly favored his opponent. Yet Democrats' financial policy agenda over the next two years is likely to be

(Image: Bloomberg News) far more about defending their past achievements than scoring new ones.

(Image: Bloomberg News)
#1 -- Big Banks Flunk OCC Risk Tests #1 -- Big Banks Flunk OCC Risk Tests

This story - the most recent of those on this list - caught fire because it provided an exclusive look into the OCC's harsher approach to bank supervision at the largest institutions. The OCC recently graded the 19 largest national banks on five factors designed to gauge how well they are being run. The results were startling.

The presidential election dominated Washington this year, but other issues also sparked controversy, including pending Basel III rules, Sheila Bair's book, and an FDIC attempt to redefine community banks. Following are the most read stories in Reg and Reform this past year, counting down from #10 to #1.

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