Law and regulation

The CFPB, FDIC and FHFA face a number of potential scenarios affecting their leadership structure depending on who wins Tuesday night.

As the presidential election looms, observers talk about changes a President Romney could make to the CFPB while regulators warn on reducing loan loss reserves too quickly. Following are the top stories from Washington last week.

The potential consequences include rising interest rates, dropping home values, a resurgence of foreclosures and a dramatic, perhaps generational loss of consumer confidence.

Only a strong QM rule can prevent a repeat of the past and protect consumers from the type of risky and irresponsible lending that preceded the foreclosure crisis.

As the effective date for compliance with the CFPB's final remittance rule approaches, bankers are saying meeting all the requirements will not feasible. "It's one of those 'you can't get there from here’ regulations," says an industry lawyer.

HSBC said it's likely to face criminal charges from U.S. anti-money laundering probes and the cost of a settlement may "significantly" exceed the $1.5 billion the bank has already set aside.

The SEC asked Groupon to explain its accounting for coupon refunds and other aspects of its business after the daily deal site revised 2011 results and disclosed a “material weakness” in its financial controls. Groupon recently entered the payments industry by offering a mobile card reader for Groupon merchants.

Regulators closed the $225 million-asset Heritage Bank of Florida in Lutz, and the $924 million-asset Citizens First National Bank in Princeton, Ill. The two failures were estimated to cost the FDIC a combined $111 million.

International Bancshares in Laredo, Texas, has redeemed another chunk of the money it received from the Troubled Asset Relief Program.

The California Department of Financial Institutions has lifted a memorandum of understanding against Hanmi Bank after the Los Angeles institution's condition improved.

Under the OCC, a complex foreclosure review process is funneling hundreds of millions of dollars to administrators and advertisements. Critics charge that banks and homeowners would be far better served by a simpler program.

The Consumer Financial Protection Bureau put out its first issue of "Supervisory Highlights," which provides an overview of issues that have emerged in examinations by the agency.

Fears about spikes in tax rates could lead a number of capital-heavy bank to consider one-time plans to return capital to shareholders.

The industry has asked the CFPB to delay the effective date for a rule expanding disclosures for remittance transfers.

When the OCC took over supervising thrifts, we evaluated the model being used and determined the cost to keep it viable was not justified. Superior interest rate risk models are available from dozens of vendors.

Liberty Bancorp in Georgia is barred from making payments to shareholders and certain debtholders without regulatory approval.

Regions Financial (RF) will redeem roughly $345 million in trust-preferred securities using proceeds from a recent preferred stock offering.

The banking unit of 1st Colonial Bancorp (FCOB) in Collingswood, N.J., has converted to a state charter and changed its name.

While ICBA supports further study, we hope Congress will come to the conclusion that it should never have been proposed for financial institutions that have no international exposures or are not of a certain size.

The Consumer Financial Protection Bureau and Federal Housing Finance Agency announced plans to create a new mortgage database, more comprehensive and streamlined than existing state and federal ones, to guide policy decisions.