BankThink

Sens. Mark Warner, D-Va., and Bob Corker, R-Tenn., are asking Attorney General Eric Holder to clarify his admission last week about whether some financial institutions are too big to prosecute.

House Financial Services Committee Chairman Jeb Hensarling is questioning whether the Federal Reserve Board can transfer funds to the Consumer Financial Protection Bureau if the is agency without an appointed director.

Empowering the unbanked to save and invest in themselves and others, through technology as simple as text- or Tweet-to-pay, will create opportunities to get people out of poverty.

Risk management issues, fair lending infractions, money laundering violations and civil money penalties will remain on regulators’ radars in 2013.

Receiving Wide Coverage ...The Mary Jo White Hearing: "Not a single senator voiced even slight opposition to President Obama's pick to head the Securities and Exchange Commission," the Post reports, despite what the Journal described as "pointed questions from lawmakers about whether her time spent defending Wall Street banks would impinge on her ability to police Wall Street." Importantly, Mary Jo White indicated flexibility on reforming money market funds, telling the Senate Banking panel that "any new rules would not interfere with 'the value' of the funds," according to the Times, which says the remark "alarmed investor advocates." Wall Street Journal, New York Times, Washington Post

Private mortgage insurance and "senior-sub" securitization structures have advantages that could accelerate private capital's return to the mortgage market, despite the lumps they took during the crisis.

Using data commonly available on most core systems, a relatively simple, inexpensive concentration stress testing model can bring value.

Receiving Wide Coverage ...Failed-Bank Fallout: D&O insurance premiums are way up for small banks as the FDIC goes after former executives of failed institutions, the Journal reports. Meanwhile, the FDIC has kept quiet about "scores" of settlements in failed-bank cases the last few years, thanks to "no press release" clauses, a Los Angeles Times investigative piece revealed. Though these clauses can seal a deal with a defendant who wants to avoid embarrassment, they represent "a major policy shift from previous crises, when the FDIC trumpeted punitive actions against banks as a deterrent to others." Wall Street Journal, Los Angeles Times

Reform efforts could result in a much smaller scope of permissible lending at the FHA, with a renewed focus on its traditional core of low-income customers, higher credit score requirements and increased down payments.

Proponents of breaking up big banks trumpet Attorney General Eric Holder's complaint that some are too large to prosecute. But indicting companies for individual employees' actions would indeed be reckless.