NEW YORK - The superintendent of banks at the New York State Banking Department said Monday that she is spearheading an effort to reach across state lines to coordinate oversight of mortgage companies and curb predatory lending.

In an interview following her appearance before the Institute of International Bankers, Elizabeth McCaul said that one of her "highest priorities" as the new chairman of the Conference of State Bank Supervisors will be "to coordinate the regulation and examination of mortgage companies."

She said regulators will closely watch stand-alone mortgage companies operating nationwide and state-regulated subsidiaries of large financial institutions. The department and the supervisor group are working toward a uniform examination, enforcement, and application protocol for mortgage companies that operate in more than one state.

The groups' activity is meant to reduce regulatory burdens, she said, "but it will enhance consumer protections because we'll be comparing notes across state lines and addressing issues that we see in more than one jurisdiction."

She said she is overseeing the coordination of an enforcement action against a mortgage company that operates in 48 states, the 12 largest of which are working together closely.

Ms. McCaul said the department is very concerned about the Federal Reserve Board's plan to impose tough capital requirements on merchant banking activities. She said the rules could have "serious negative consequences" on U.S. banks' expansion into nontraditional activities.

She noted that few banks and securities firms have taken advantage of the freedoms offered by the Gramm-Leach-Bliley Act of 1999.

"We believe that with some changes in the merchant banking proposal you might see that. We're concerned that it goes counter to" some Gramm-Leach-Bliley provisions, she said.

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