Law and regulation

A federal court judge on Tuesday posed several tough questions to parties involved in retailers' lawsuit against the Federal Reserve Board's implementation of a law setting a cap on debit interchange fees.

In a court hearing retailers will argue that the Federal Reserve Board got the implementation of the Durbin amendment wrong with the 21 cent limit. They argue the Fed's early proposed 12 cent limit was the more accurate interpretation of that part of Dodd-Frank.

The FDIC's board of directors will meet Oct. 9 to discuss stress-testing requirements mandated under the Dodd-Frank Act, as well as some tweaks to how the agency charges large-bank premiums.

D.C. District Court Judge Richard Leon pressed retailers and the Fed on the design and effect of the agency's rule capping interchange fees during oral arguments on Tuesday, but gave little indication of how he would decide the case.

Banks with less than $10 billion in assets are exempt from clearing and exchange trading requirements, but as derivative users they will have to post margin, keep records and amend documents.

Tuesday was the deadline for the nation's five largest mortgage servicers to implement 304 agreed-upon standards. Consumer advocates expressed skepticism that the companies have reached that goal.

Nationstar Mortgage went from private equity flop to a top servicer of troubled loans, thanks to deft management and a Fannie Mae partnership once hidden even from parts of the government.

After the filing of a civil complaint alleging fraud in Bear Stearns' mortgage-backed securities operation, New York Attorney General Eric Schneiderman says he expects more cases to come.

Consumer litigation against collection agencies and creditors fell across the board in the Sept. 1-15 period compared to the previous half month, according to data pulled from U.S. district courts.

Intended to bring together the entire universe of U.S. financial regulators in the hope that doing so would identify and forestall new risks to the financial system, the FSOC, two years in, has not identified much and can therefore be credited with little forestalling, writes the ABA's Wayne Abernathy

Banks with at least $10 billion of assets saw their share of deposits increase to 74.4% at midyear from 72.4% a year earlier, the FDIC said Tuesday in its annual Summary of Deposits. Also, the number of U.S. branches and thrifts shrunk.

Matt Williams, incoming chairman of the American Bankers Association, says banks can rebound by drawing on lessons from past crises, updating business models and hiring a new generation of bankers.

American International Group said the Financial Stability Oversight Council told the insurer it's under consideration to be labeled a potential risk to the financial system.

Housing and Urban Development Secretary Shaun Donovan defended efforts by the Obama administration to help the housing market recover, arguing it faced significant hurdles over the past four years.

Intended to bring together the entire universe of U.S. financial regulators in the hope that doing so would identify and forestall new risks to the financial system, the FSOC, two years in, has not identified much and can therefore be credited with little forestalling.

Although American Express received lighter fines than the two previous credit card players targeted by the Consumer Financial Protection Bureau, many believe the CFPB's third enforcement action is its biggest statement yet.

The notion of decreasing the degree to which a banker can use his or her judgment to add to the ALLL not only throws the baby out with the bathwater, but it also fails to protect the investor, the very person that the accounting rules claim to be protecting.

The third enforcement order from the CFPB, resulting in $112 million in penalties against American Express, brought together Utah and federal regulators in investigating violations across subsidiaries of the company.

The battle over interchange fees moves to its next phase Tuesday when a federal judge hears complaints from merchants that the Federal Reserve’s cap on the fees not go far enough.

The New York attorney general sued JPMorgan Chase (JPM) on Monday, charging that the Bear Stearns brokerage it bought committed fraud in the sale of hundreds of billions of dollars in mortgage-backed securities on the eve of the housing crisis.