Slideshow 'Naughty banks for trying to make a profit': Comments of the week

Published
  • May 24 2018, 10:00pm EDT

Readers celebrate first quarter earnings, weigh in on banks using blockchain, slam a postal banking proposal and more.

On an argument supporting a legislative provision that would exempt low-volume banks from certain Home Mortgage Disclosure Act reporting requirements:

“Virtually all of the new HMDA data fields are for data that a lender already collects. For example the borrower's credit score, or the originator's NMLS number. The burden of putting this data into a spreadsheet should be immaterial to any well-run financial institution, and being excused from it isn't going to change the financial outlook of any bank.”

Related: HMDA measure in reg relief bill is misunderstood

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Another reader weighs in on the HMDA data collection measure in the regulatory reform package:

“The problem is the unreasonable level of tolerance for errors by the examiners. The more data fields the more possibilities for errors. And if you have to have scrub and resubmit all those data fields, it would be a nightmare. It is also very challenging to produce a LAR with so many fields. The scariest part of any compliance exam is when they are in doing the data validation. Also, most of our customers are offended by the ethnicity questions.”

Related: HMDA measure in reg relief bill is misunderstood

On strong first quarter earnings busting the industry narrative that banks need even more relief from policymakers:

“Naughty banks for trying to make a profit. They should just give everyone a piece of their earnings to make everything even (end sarcasm font). In other news, if you have many less people at the table, they will be able to get a larger piece of the pie.. Yes, banks are profitable or at least should be, so should every business. I don't hear a public outcry against lawyers and politicians for all the money they make lying and cheating the american people..."

Related: Banks as underdog? After reg relief, that ship has sailed

On Sen. Kirsten Gillibrand, D-N.Y., proposing the U.S. Postal Service offer banking products:

“Gillibrand's suggestion, like so many of the ideas springing from the fevered brows of today's well-intended progressive politicians, is sadly just further proof that in Washington, no bad idea ever really dies. Postal banking has already been tried and was wisely if belatedly put to bed in the early 50s. Let the private sector handle financial services. Isn't it instructive that the financial woes of the U.S.P.S. are largely inflicted by competition with the private sector's FedEx and UPS.”

Related: Return to sender: Here's what's wrong with postal banking

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On the prospect of regulatory relief being signed into law:

“I'm hoping we'll see less raised eye brows over the next few years. Time to start dialing back the ‘guidance’ too. The examiners need to know that not every bank is looking to cheat its customers and that customers bear responsibility for their actions.”

Related: Think you’ve seen the Trump effect on regulation? Just wait

On banks getting more involved in blockchain:

“Blockchain has a future, but major issues need attention. 1st, no current option can handle volume like a typical credit card transaction system. 2nd, and more importantly, even though blockchain tech is inherently secure, bad actors (complicit fraudsters, synthetic user fraud) can start a block like anyone else, *requiring* advanced biometric login for end-to-end security. Last, you cannot delete a block, rendering it incompatible with many global data handling rules. We're not there yet!”

Related: The many ways banks are using blockchain

On the Office of the Comptroller of the Currency encouraging banks to offer short-term loans to subprime borrowers:

"Price controls on any product or service, even credit, is a bad idea. FDIC attempted to offer small dollar loans at the 36% price controls which was resoundingly a failure. Banks have risk against deposits and insurance to consider before they build large portfolios of sub 680 FICO customers. Non banks have filled this void. We need a robust marketplace with various participants so consumers have more options."

Related: OCC gives banks green light to compete with payday lenders