Politics

A coalition of Democratic attorneys general, led by California and Illinois, have sued the Department of Housing and Urban Development over a guidance that they argue will scale back enforcement to strict federal standards and threaten state funding to enforce fair housing laws.

The deregulatory executive order, which pairs with another targeting small players' home loan rules, impacts the FHFA, HUD and other agencies.

The Fed explores ditching paper checks; enforcement actions against banks have plunged under Trump; the CFPB gets a stinging rebuke.

A White House executive order issued Friday afternoon directing regulators to ease Dodd-Frank compliance burdens comes as a bipartisan housing bill advances on Capitol Hill.

A federal judge wrote in an opinion that a "mountain of evidence" suggests the subpoenas were an effort to push Federal Reserve Chair Jerome Powell to lower interest rates or resign.

Federal bank enforcement actions have dropped sharply since the start of the second Trump administration, but experts' views vary about whether less enforcement will result in a buildup of risk in the financial system.

Caution around the move is growing as focus has shifted to affordability, and current trading prices make near-term action unlikely, according to Wedbush.

Before holding financial institutions accountable for new regulatory expectations, clearer guidance is needed on what constitutes appropriate risk-based decision-making versus impermissible "debanking."

A New York state bill would reduce the barrier for minority-bank and community-bank participation in the state's long-standing Banking Development District program.

Industry comments are favorable, but with statements like "no bill is perfect" and "bold action is needed," groups want changes before it goes to the president.

A group representing this part of the industry and a community lenders' association both called for more time to implement the legislative mandate.

The Senate passed a bipartisan housing bill in an 89 to 10 vote, but how quickly and easily the bill can pass the House remains unclear.

The conflict pushed oil price futures above $100 a barrel for a short time earlier this week, which affected bond investors and the 10-year Treasury yield.

Federal Reserve Vice Chair for Supervision Michelle Bowman outlined upcoming changes to the bank regulatory capital framework in a speech Thursday, focusing on streamlining bank capital requirements through Basel III and global systemically important bank surcharge rules.

The conflict with Iran has thrown volatility into bank stock prices, which is often the currency of dealmaking. "Stability is important to be able to do deals," one analyst said.

Comptroller of the Currency Jonathan Gould said one of the early messages he is hearing from banks and supervisors revolves around an uneven playing field between small banks and their core providers, but suggested formal rules to address the problem are not imminent.

The measure, led by Sens. Elizabeth Warren, D-Mass., and Josh Hawley, R-Mo., would require regulators to recoup compensation from bank executives during the five years prior to their bank's failure.

Federal Deposit Insurance Corp. Chair Travis Hill said in a speech Wednesday morning that the agency will move to codify stablecoins as ineligible for deposit insurance — which is required under the GENIUS Act — and that the prohibition likely will include pass-through deposit insurance arrangements.

Federal Reserve Vice Chair for Supervision Michelle Bowman said in a speech Wednesday morning that the central bank's ongoing consideration of changes to its emergency liquidity rules and facilities must align with a separate goal of shrinking the Fed's balance sheet.

Kraken Financial's receipt of a limited Federal Reserve master account is leading some industry observers to question whether the approval creates a new avenue for master account-seekers or whether it's a preview of the proposed "skinny" account.