Comments of the Week: Dimon's Reputation; What to Do About Fannie, Freddie
May 24, 2013 8:24 AM
American Banker readers share their views on the most pressing banking topics of the week. As excerpted from the Comments sections of AmericanBanker.com articles.
(Image: Thinkstock)
On how the Qualified Mortgage rule constrains community bank lending:
"Loan applications we look at are either clearly approvals, clearly denials or 'in the middle.' Sadly, these customers 'in the middle' will get pushed to the denial side due to fear of litigation risk. ... Now their only hope of homeownership will be the ever shrinking Fannie Mae box."
Related Article:
(Image: Thinkstock)
On Treasury Secretary Jack Lew urging lawmakers to give Dodd-Frank time before enacting new reforms:
"Let's not forget that not all that long ago these same players - Treasury, the Federal Reserve, etc. - denied emphatically that TBTF even existed. Then in 2008 they found it was real, like we knew all along."
Related Article:
(Image: Bloomberg News)
On Federal Reserve Chairman Ben Bernanke's increased concerns about interest rate risk:
"The low-rate policy has forced institutions to 'reach for yield' and take on interest rate and credit risk. History shows that the seeds of financial crises are sown in low-rate environments
It's absurd to encourage financial institutions to 'reduce their reliance on interest rates,' suggesting we should stop taking deposits and making loans and investments."
Related Article:
(Image: Bloomberg News)
On JPMorgan Chase's shareholder vote denting Chairman and CEO Jamie Dimon's reputation:
With 68% voting against the split proposal, "I'm thinking most CEOs wish they were as 'dented' as Dimon."
Related Article:
(Image: Bloomberg News)
On JPM's stock performance:
"A historically lower stock price is what you can expect when banking and securities/trading are combined."
Related Article:
(Image: Bloomberg News)
On lenders seeking lower guarantee fees in a GSE risk-sharing pilot:
"GSEs should abide by the same, if not more rigorous capital standards than banks to protect the taxpayer."
Related Article:
(Image: Thinkstock)
On Fannie Mae and Freddie Mac's loan performance:
"Congress needs to recognize the vital role played by the GSEs and improve them. Failure to do so will have disastrous consequences for the housing finance system and the nation's economy."
Related Article:
(Image: Bloomberg News)
On the House passing a bill requiring the SEC to conduct additional economic analysis on its rules:
"The benefit from having honest markets is incalculable
The proposed law ... not only creates new costs for regulation/prosecution, but would serve only to provide a shield for malefactors when, under some arbitrary criteria, the costs are deemed to outweigh the benefits."
Related Article:
(Image: Thinkstock)
On why getting customers to linger in branches may not be a viable strategy:
"The vast majority of bank transactions generate operating losses, unlike organizations like Starbucks which generate incremental revenue and profit from every customer transaction and are thus motivated to keep the customer in their stores for as long as possible."
Related Article:
(Image: Thinkstock)
On a call to firm up the orderly liquidation authority in Title II of Dodd-Frank:
"What is even more important is to implement Dodd Frank's Title I" - systemic risk regulation and oversight - "to avoid having to ever use Title II."
Related Article:
(Image: Thinkstock)
