BankThink

While the Federal Reserve’s exclusion of trust-preferred stock from Tier 1 capital is understandable, an analysis shows cumulative preferred stock can absorb losses at times of distress.

The Office of the Comptroller of the Currency has named a new senior deputy comptroller for large banks.

Applying the latest statistical techniques to measure operational risks lulls us into a false sense of analytic security and desensitizes management to the important qualitative aspects of controlling such exposures.

The bill may be a bridge between the advocates of a purely private market and those who favor some role for the federal government in housing.

Six regulatory agencies proposed an exemption from appraisal requirements for three types of higher-priced mortgage loans.

Receiving Wide Coverage ...Talking Rates: More communication and more interpretation. Federal Reserve Chairman Ben Bernanke's remarks at a conference Wednesday and the release of the minutes of the central bank's June policy meeting delivered two major themes. Like other officials recently, Bernanke sought to decouple tapering of the Fed's asset purchases, which could begin later this year, from views on its policy rate, saying that "the overall message is accommodation." Meanwhile, the minutes showed divisions among the Fed's regional presidents and board members, with one block inclined to end the asset purchases by yearend and another inclined to wait for a stronger outlook for the labor market. Markets, which appear to have been trading as though the Fed's posture on asset purchases says something about its posture on the path of short-term rates, didn't move much, with the Dow ending the day about flat. According to the Journal, Bernanke said he would not have changed his previous comments. "The market volatility of the past six weeks could have been much worse if he had kept silent on their plans for winding down the program, misleading investors into thinking the bond-buying could go on forever, Mr. Bernanke said."

The Consumer Financial Protection Bureau issued bulletins on Wednesday warning any companies collecting debt that they would be held accountable for unlawfully dealing with consumers.

The Financial Stability Oversight Council, designed under the Dodd-Frank Act to identify risks to the stability of the financial system, unanimously voted Tuesday naming American International Group and GE Capital as systemically important institutions.

Overregulation and elimination of short-term credit alternatives will merely hurt consumers, particularly when criticism of existing products comes with no new solutions.

Lenders will need to evaluate and subsequently document their compliance with ability-to-repay and fair-lending rules in order to avoid getting caught in regulators’ crosshairs.