Law and regulation

WASHINGTON — Comptroller of the Currency Thomas Curry said his agency is increasingly concerned about the cybersecurity risks from banks relying too much on certain vendors and using service providers in foreign countries.

As drafted, the Johnson-Crapo bill would allow big banks to originate, aggregate, and guarantee mortgages. Small lenders worry such vertically integrated companies could price them out of the business.

Sens. Sherrod Brown, D-Ohio, and Elizabeth Warren, D-Mass., urged regulators on Wednesday to tighten restrictions on banks involved in physical commodities markets.

Bank of America Corp. is paying $950 million to settle claims that its Countrywide unit pooled faulty mortgages into securities that helped hobble Financial Guaranty Insurance Co. and saddled buyers with losses.

Demand for loans by consumers and businesses grew in the first quarter, according to a Federal Reserve report released Wednesday.

The Obama administration is urging activists like the National Council of La Raza to support legislation to overhaul the housing finance market, ahead of a Senate Banking Committee vote scheduled for late April.

A poor showing for a bank in the Dodd-Frank stress test would need to be reflected in a counterparty bank's internal rating system, potentially restricting the bank's access to market liquidity.

The moves are part of a recent trend of banks exiting businesses that they believe have fallen out of favor with regulators.

U.S. banks today are safer, sounder, more secure, transparent, accountable and are performing their critical roles in the global economy.

The Office of the Comptroller of the Currency is likely to make changes to its proposal outlining the "heightened expectations" the largest banks must face after the industry raised concerns that certain provisions could backfire.

The most notable quotes from American Banker stories of the previous week. Readers are encouraged to add their own observations in the Comments fields at the bottom of each slide.

Banks need to take fewer risks and hold more capital, but recent regulations, including the Volcker rule, are "not cost-effective" for banks and "too expensive for the potential benefits." That's bank critic Anat Admati, the Stanford finance professor and co-author of "The Bankers' New Clothes," who also discusses big banks' corporate governance and recent probes into high-frequency trading.

WASHINGTON — Federal Reserve Board Chair Janet Yellen said Tuesday that the largest banks need to face higher capital requirements to stem potential risks to the financial system.

The proposed Small Lender Mutual cooperative would be expensive for small firms to capitalize, and its securities may get inferior pricing compared to those issued by large banks and nonbanks.

Banks identified as systemically important to the global economy face tighter rules on how much business they can do with each other as part of a push to limit the chance a single failure would drag down multiple lenders.

The federal push to stamp out illegal online lending is having unintended negative consequences, an umbrella group for state banking regulators says.

The Senate Banking Committee is scheduled to vote on its bill to overhaul the mortgage finance market on April 29, but questions are now being raised about whether that date will slip, as supporters struggle to secure additional votes.

The Senate Banking Committee is due to vote April 29 on a bill to revamp the housing finance system, though that date may slip. The legislation, by panel leaders Tim Johnson and Mike Crapo, had an auspicious start, with an equal number of members from each party among the dozen who came out in support of it. That's enough to pass the panel, but not sufficient to bring it to the Senate floor. Here are the other Dems the lawmakers are hoping to woo:

Facebook is reportedly close to obtaining a license to operate as an electronic money institution in Ireland, a move that builds on the company's years of experience handling payments on its home turf.

As the U.S. and Europe impose sanctions against Russia, western banks are keeping closer tabs on their business dealings in the country. JPMorgan Chase's temporary hold on a Russian Embassy payment and the disruption of VISA services for SMP Bank could be just the tip of the iceberg.