'How Can This Be Predatory?': Comments of the Week
September 30, 2016 7:30 AM
American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of AmericanBanker.com articles and our social media platforms.
On the Consumer Financial Protection Bureau's proposal to rein in small-dollar, short-term lending:
"How can there possibly be a predatory motive on a unsecured signature loan. If the consumer doesn't pay the lender loses, there's no asset no car to repossess, no home to foreclose on. Can someone explain to me how this can be predatory?"
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On the idea that the Wells Fargo scandal bolsters arguments against a housing finance plan that benefits big banks:
"The Wells cross-selling scandal is unfortunate but not surprising. It is also unfortunate but not surprising that the Fed and Dodd Frank promote Too-big-too-fail. But Fannie and Freddie are already too big to fail and no government sponsored lender has been allowed to fail. We need banks. We don't need Fannie and Freddie."
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Another commenter agreed that big banks shouldn't gain from housing finance reform:
"The American people need F&F to protect them from rapacious banks which if they didn't have to meet GSE/CFPB/QM mortgage standards, would revert to form, cut corners and scam, again."
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On GOP nominee Donald Trump attacking the Federal Reserve Board in the first presidential debate:
"For a businessman, his comments do not make much sense; nor do they seem truthful. What is he looking for? A high interest rate environment?"
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On using artificial intelligence to underwrite loans:
"With AI we have an outstanding opportunity to eliminate gender and other forms of bias in lending. It would be interesting to compare 'before and after"' stats of acceptances by the interesting categories as well as the default rates. Aside from reduced discrimination, I believe that default rates will show that removal of discrimination will raise the quality of the applicants on average."
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On House Democrats urging the CFPB to strengthen its payday loan proposal:
"Proponents of stronger payday lending rules probably won't stop until payday lending is illegal, sending loan customers where? To banks, which Congress regularly casts as bad, too? To loan sharks, who are really predatory, not just in the financial sense, but in the physical sense, too? I'm not suggesting we don't need regulation, but I do wonder, what would the financial landscape look like when Democrats and community groups are satisfied with regulation?"
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On IBM buying influential consultancy Promontory Financial Group (via <a href="https://twitter.com/rrgarver/status/781515425150603264" target="_blank">Twitter</a>):
"WHAT?"
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On IBM's plan to have bank regulatory experts from Promontory teach Watson how to handle risk management:
"IBM may yet succeed in fooling bankers into thinking an application will 'think' for them, but more likely, they will just shelve any human competition by buying their silence."
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