'This Is a Double Whammy for Banks': Comments of the Week
November 8, 2013 9:28 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.
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On small-dollar lenders moving away from non-amortizing payday loan products:
"If your lending model is dependent on the old ways of doing business, you're a dinosaur. Evolve or die!"
Related Article:
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On the Consumer Financial Protection Bureau's crackdown on the auto lending industry:
"Anyone with some auto lending background knows these CFPB efforts will close off credit to marginally qualified borrowers."
(Pictured: Richard Cordray, CFPB Director)
Related Article:
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On the CFPB's crackdown on the auto lending industry:
"Those marginally qualified borrowers can still be serviced, but the CFPB thrust is that there should be
some relationship between risk and return versus total abuse."
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On the CFPB's forthcoming debt collection rules:
"The new consumer credit markets will simply be structured and priced to advance new loans based upon legally approved processes which pass the CFPB sniff test
It will result in a much less dynamic and broad-based consumer loan market."
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On requiring collection agencies to inform borrowers who sold them the debt:
"Most consumers would be cooperative when they are confident it is truly their debt."
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On the Federal Deposit Insurance Corp. urging changes to swaps contracts:
"This is a great example of the kinds of underbrush that must be cleared away before the FDIC's orderly liquidation authority could ever become a realistic alternative for resolving giant banks."
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On Bank of New Zealand's technology that reads people's faces for honest feedback:
"Perhaps the banks should train those cameras on themselves as part of a campaign to reclaim consumer confidence."
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On claims the Fed's liquidity plan could spur a collateral shortfall:
"Oh what a tangled web we weave."
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On the Federal Reserve's liquidity plan possibly spurring a collateral shortfall:
"Tweak the capital requirement. Leave the rest alone."
(Pictured: Janet Yellen, Federal Reserve Chairman nominee)
Related Article:
(Image: Bloomberg News)
On a call for a regulatory rethink for small banks:
"We need a regulatory program that adds value to banks, that enhances the ability of banks to serve their customers. Instead, for years we have had a regulatory system that makes it harder for community banks to serve their customers."
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On banks bracing for the end of multifamily prepayment penalty income:
"As interest rates rise (over the long term), many portfolio lenders will experience a mismatch in liability and assets rates and durations, producing a decreasing margin. This is a double whammy for such institutions."
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On removing three words from a Dodd-Frank rule so regulations can mention credit rating agencies:
"As dysfunctional as Congress may be, surely it can muster the votes to change three little words and in so doing remove at least one enormous burden that has been placed on community banks."
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