Open for Comment
TRUTH-IN-LENDING: Proposal by the Federal Reserve Board to revise its staff commentary on Regulation Z to clarify that payday loans are credit transactions. Published Nov. 5. Comments due Jan. 10.
PUBLICATIONS: Announcement by the Fed that it is reviewing how to improve or whether to eliminate any of its publications. Published Nov. 2. Comments due Dec. 17.
RECEIVERSHIP ASSETS: Proposal by the Federal Deposit Insurance Corp. to prohibit the agency -- when acting as receiver or conservator -- from recovering financial assets transferred by the failed institution as part of a securitization or participation. For the prohibition to apply, such transfers would have to meet all conditions for sale accounting under generally accepted accounting principles. Published Sept. 21. Comments due Dec. 20.
ASSET PURCHASES: Proposal by the FDIC to bar people who profited from, or helped cause, the failure of a bank or thrift from buying that institution's assets. In some cases, prohibitions would also apply to people who have defaulted on loans or been convicted of financial crimes. Published Sept. 21. Comments due Dec. 20.
MERGER ACCOUNTING: Proposal by the Financial Accounting Standards Board to eliminate the pooling-of-interests method of M&A accounting. Public hearings are expected in the first quarter, and a final standard could be issued late next year. An interim draft approved April 21 suggested requiring merging parties to use the purchase accounting method. Released Sept. 8. A copy is available on the FASB's Web site at www.fasb.org. Comments due Dec. 7.
ELECTRONIC DISCLOSURES: Interim rule by the Fed to let banks send savings account statements electronically, effective Sept. 1. Proposal to let banks make consumer protection disclosures on-line to borrowers revised by the Fed. Published Sept. 14. Comment deadline extended to Nov. 15.
BASEL PAPERS: The Basel Committee on Banking Supervision issued three proposals, covering principles for managing and disclosing capital risk, best practices for credit risk disclosure, and guidelines for managing settlement risk in foreign exchange transactions. Released July 27. A copy is available on the Bank for International Settlements' Web site at www.bis.org. Comments due Nov. 30.
CAPITAL RULES: Proposal by the Basel Committee to update the 1988 international risk-based capital accords. Rather than basing capital requirements on the type of asset a bank holds, capital would be based on the riskiness of the bank's borrowers as determined by a rating agency such as Standard & Poor's. Released June 3. A copy is available on the Bank for International Settlements' Web site at www.bis.org. Comments due March 31.
FANNIE/FREDDIE CAPITAL: Proposal by the Office of Federal Housing Enterprise Oversight to create risk-based capital standards for Fannie Mae and Freddie Mac. Published April 13. Comment deadline extended a second time, to March 10. Recent Actions
CHARGEOFFS: The FDIC, the Comptroller's Office, and the Fed have voted to delay the implementation date of loan chargeoff guidelines adopted last February. Originally, the agencies said banks should be given until June 30, 1999, to implement manual changes to their procedures, but until Dec. 31, 2000, to implement computer-related changes. The staggered dates were intended to make sure the new guidelines did not interfere with bank efforts to prepare computers for the year-2000 date change. But in response to industry complaints, the three bank agencies decided to push all compliance back to Dec. 31, 2000. When the Office of Thrift Supervision approves the date change, the adjustment will be noted in the Federal Register.
DEPOSIT INSURANCE: The FDIC voted Nov. 12 to hold deposit insurance assessment rates steady through the first half of 2000. In a 4-to-0 vote, the FDIC board elected to maintain the current rates of 0 to 27 cents per $100 of insured deposits. As a result, well-capitalized banks and thrifts with overall Camels ratings of 1 or 2 will still get free deposit insurance coverage. The FDIC will mail its semiannual assessment notices later this month.
TRUTH-IN-LENDING: The Fed adjusted the dollar amount of mortgage fees that trigger additional disclosures to $451, or 8% of the loan amount, whichever is greater. Published Nov. 5. Effective Jan. 1.
COMMUNITY BANKS: The OCC relaxed several small-bank regulations, including moves designed to make it easier to convert to Subchapter S tax status and to attract quality directors. Published Nov. 4. Effective Dec. 6.
RETURNED CHECKS: The Fed issued a final rule that gives banks more options for returning checks electronically. Published Nov. 3. Effective Dec. 15.
INTERNET BANKING: The OCC on Oct. 14 issued examiner guidelines on Internet banking. Examiners must be certain that the bank's cost savings from on-line banking offset the increased risks. They must also make sure banks understand that the risks they face in cyberspace are different in kind and degree from those common to bricks-and-mortar banking.
HIGH-LTV LENDING: In an Oct. 12 statement, the four bank and thrift regulatory agencies clarified existing guidelines on high loan-to-value lending. The statement reiterated their concern that high-LTV loans do not receive adequate risk-return analysis by banks and that banks keep records of all exceptions made to their high-LTV lending policies. The value of a bank's high-LTV portfolio may not exceed 100% of its capital, and the statement noted that as that ratio nears 100%, banks can expect "increased supervisory scrutiny."
THRIFT DIRECTORS: The OTS began distributing on Oct. 21 two guidebooks for members of savings institutions' boards of directors. One guidebook details the duties of directors and covers several aspects of oversight, such as risk management and compliance. The second book provides pointers on how to interpret reports from management.
FOREIGN BANKS: The four federal bank regulators adopted a final rule on Oct. 21 that extends the examination cycle of small and healthy operations of foreign banks in the United States to 18 months. Effective Oct. 22.
PROBLEM LOANS: The Fed issued two supervisory letters on Sept. 29 on problems loans. One gives examiners more flexibility in determining when to write detailed reports on underperforming loans, while the other requires examiners to record significant responses bank managers have to loan grades. Action Expected Soon
SUBPRIME LENDING: FDIC Chairman Donna Tanoue announced a crackdown on subprime lending in two recent speeches. On Nov. 2, she said examiners will require banks involved in subprime lending to have tough underwriting standards, higher-than-average capital, and adequate loss reserves.
HOME LOAN BANKS: The Federal Housing Finance Board is expected to withdraw its proposal to change the capital structure and investment management of the 12 Home Loan banks. Published in the Federal Register on Sept. 27, comments were not due until Dec. 27. However, the plan would be superceded by the financial reform bill that is expected to be signed shortly by the President.
CREDIT REPORTING: Bank and thrift regulators are working on joint guidelines urging subprime lenders to report positive borrower payment histories to credit bureaus. Separately, the OCC has been discussing the credit reporting issue with the Federal Trade Commission.
THRIFT RULE: The Office of Thrift Supervision is expected to issue a rule by yearend to clarify when a unitary thrift holding company may own more than one thrift but still engage in nonfinancial activities.
SUSPICIOUS ACTIVITY: The Financial Crimes Enforcement Network is expected soon to propose a rule requiring securities brokers and dealers to report suspicious transactions by customers.
LOAN POOLING: The Small Business Administration is expected to propose a rule soon that would let several lenders pool and sell the nonguaranteed portions of their 7a loans. Comment Closed
REG B: Proposal by the Federal Reserve Board to let lenders collect race and gender data on more borrowers. Published Aug. 16. Comments were due Nov. 10.
INSURANCE PREMIUMS: Proposal by the FDIC to reduce to 15 days, from 30, the time a bank is given to pay its deposit insurance premium after being billed. Proposal also would triple, to 90 days, the time a bank or thrift has to request a review of its premium assessment. Published Sept. 8. Comments were due Oct. 25.