Ebrima Santos Sanneh

Banks have offered a more tepid critique of regulatory proposals to expand resolution planning and long-term debt for regional banks, suggesting the industry is intent on curbing July's Basel III capital proposal instead.

The Federal Deposit Insurance Corp. has issued proposals that would make banks with $100 billion of assets or more hold more long-term debt as a cost buffer in the event of a collapse and meet new planning requirements in case they ever have to be resolved in an emergency.

Banking regulators have been debating how to reform the implementing regulations for the Community Reinvestment Act across two presidential administrations. But despite banks' urging to slow down, regulators are poised to finish the job in early fall.

The American Bankers Association and Bank Policy Institute Tuesday urged bank regulators to delay the finalization of its Community Reinvestment Act rule, saying regulators have not calibrated the rule to account for upcoming capital changes or considered whether courts will find the Consumer Financial Protection Bureau's funding structure constitutional.

John Paul Dillon pleaded guilty to nearly $1 million in fraud related to COVID-19 emergency small-business programs, including the Payroll Protection Program and the Economic Injury Disaster Loan Program and a fraudulent loan application for a mortgage.

The Office of the Comptroller of the Currency granted federally chartered banks permission Monday to close branches in California, Nevada and Arizona affected by Tropical Storm Hilary.

Banking and credit union regulators encouraged compassionate treatment of customers in Hawaii communities hit by wildfires. They also vowed to grant expedited approvals of temporary banking facilities, be flexible in compliance matters and provide other support to financial institutions.

Forthcoming regulations to strengthen capital buffers and resolution processes for large regional banks are sparking debate about those proposals' efficacy and compounding existing problems for regional banks around stability and funding costs.

Federal Deposit Insurance Corp. Chair Martin Gruenberg said Monday that the agency is not backing down on its Basel III capital proposal, and wants to implement long-term debt requirements and adjustments to the living wills and uninsured deposit rules.

Fannie Mae and Freddie Mac can likely withstand potential credit losses twice as high as last year's in the latest scenario, but they are at more risk of slipping into the red.