Comments of the Week
August 17, 2012 9:08 AM
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On Julie Williams' departure from the OCC:
"The focus of criticism has been on the role played by the OCC in consumer protection issues, but the Fed easily deserves as much if not more blame for any failure to protect consumers. It is unfair to focus on Julie Williams. She has been one of the very best of financial agency counsel and we should recognize and applaud her contribution and her fine example of public service."
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On Julie Williams' departure from the OCC:
"What does this tell us about who is driving the OCC's policy agenda? What does it tell us about the future direction of that policy agenda?"
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On force-placed insurance kickbacks:
"The lender has done nothing to earn the commission. Blaming the borrower - 'they could have obtained it themselves' - is yet another example (think exploitive overdraft programs) of banks rationalizing bad practices."
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On the addition of Paul Ryan to the Republican presidential ticket:
"Adding someone to the ticket who proposed fiscal responsibility is not a bad thing. Remember, it's not what the country wants to hear, but what it SHOULD hear."
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On Paul Ryan's views on banking issues:
"Ryan only looks overly conservative because Obama and the Democratic party has moved so far to the left."
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On Paul Ryan's views on banking issues:
"… if bankers really understood what Ryan has been saying they would not be quite so enthusiastic, I would suggest that Ryan will soon have to change his views or at least fudge them quite substantially … There is no way the publicly subsidized behemoth banks will want to hear his message and the last thing they would want is to have free market principles apply to them."
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On StanChart's $340 million money-laundering settlement:
"The resolution of this affair strikes me as a variant of the TBTF thinking regulators seem unable to shake. Smaller players would never get the chance to pay their way out of a mess half as ugly."
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On the $10 billion dividing line regulators apply to banks:
"These artificial asset lines all need to be reconsidered and junked for a more calibrated and flexible supervisory program. It takes more thought and work, but it will be better for banks and their customers."
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On Ryan's plan for the GSEs:
"If Fannie and Freddie are abolished, housing finance becomes dominated by the 5 largest banks facilitated by Wall Street. The federal government will still have the risk with the FDIC insurance on the deposits of the five largest banks. The conservative plan for 'privatizing' the mortgage market is a pipe dream."
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On Ryan's plan for the GSEs:
"We don't need FNMA and FHLMC; we never did. They should cease doing new business and be wound down in as orderly a fashion as possible."
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On the latest CRA data:
"Over the last 4 years, not one of the Too Big to Behave Banks has lost its Outstanding rating, despite a credit freeze that required hundreds of billions of dollars in bailout funding, and a mortgage market where only those with the best credit can obtain loans. CRA examinations are just one more area where federal financial regulators refuse to hold the mega-banks accountable for their actions - or lack thereof."
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On how to personally connect with customers:
"I treat every client as if the survival of my family depended on them doing business with me … Technology has given us many wonderful tools for reaching out to clients, but nothing beats a face-to-face meeting or phone call to follow up or just say thank you."
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On the need for new kinds of banks:
"People forget the reason we created savings banks over 100 years ago is that the then-big city banks didn't want lower income customers but society recognized these customers needed some sort of bank for doing transactions and to encourage saving. Today we have a proliferation of predatory entities because we lack decent alternatives, unfortunately including from our traditional banks (with some bank and credit union exceptions)."
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On how regulation prohibits banking diversity:
"Very few new banks will be formed until capital can flow freely into the banks and an applicant can submit an application for a new bank with some assurance that it will be processed in a reasonable time."
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On the shortcomings of Glass-Steagall:
"Designing a bank supervisory program that makes our system stronger and our economy better is hard work and cannot be solved by easy formulas reaching back to a mythical past."
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On the effectiveness of Glass-Steagall:
"Glass and Steagall rightfully separated the 'marketing and distribution' (buy and sell) from the 'buy and hold.' That is, the cheerleaders from the wise coaches, and those in the owner's box."
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On the proposed Basel III capital rules:
"This effect of Basel III will further delay the return of the banking industry to normalcy, which will be one more drag on the overall economy returning to normalcy."
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On the FDIC's mega-bank liquidation plan:
"Not only should Title II be retained, the FDIC should exercise its authority under Title II as soon as practical to alter the market distortion that implies that TBTF is alive and well."
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