Policy & Regulation

A hike in guarantee fees could encourage banks to retain loans they might have otherwise sold to Fannie or Freddie, but observers are skeptical that it will accomplish its true mission of jump-starting the market for private-label mortgage securitizations.

Regulators raised more concerns on Thursday that some institutions might take heightened risk by seeking profits from locking into longer-term fixed yields and diving into complicated growth markets such as oil, gas and leveraged lending.

A bipartisan group of lawmakers is urging regulators to reconsider a provision in the recently finalized Volcker rule that they warn could harm community banks that own trust-preferred securities.

Many small banks are well managed and provide value to their customers and investors. The more profound question for the economy is what effect the little guys have on the stability and efficiency of the U.S. financial system.

In her final column for American Banker, Editor-at-Large Barbara Rehm says there is no denying the system is safer than it was in 2007, and while further changes may be needed, it makes sense to "take a breather."

Barbara A. Rehm, the former editor-in-chief turned columnist for American Banker, is leaving the paper to join Promontory Financial Group.

The Consumer Financial Protection Bureau issued a consumer advisory report on Wednesday which is provoking concerns that the agency may be inadvertently encouraging borrowers to challenge their lenders in court after new mortgage rules go into effect in the new year.

Federal Reserve Board Chairman Ben Bernanke said regulators have made progress over the last year, but more reforms need to be made in order to keep the financial system safe.

The Independent Community Bankers of America and the American Association of Bank Directors warned regulators that the Volcker Rule will force banks to lower capital to dangerously low levels.

The $1.1 billion-asset company said in a regulatory filing Thursday that it sold bank and insurance trust-preferred collateralized debt obligations that cost about $8.3 million -- at an $850,000 loss.