Regulatory guidance

Sen. Mark Warner led a group of Democratic senators in calling on bank, credit union and GSE regulators to give detailed instructions on helping consumer and commercial borrowers hurt by the COVID-19 outbreak.

The agencies recommend steps financial institutions should take to proactively prevent disruption of operations, minimize contact between staff and consumers, and plan for how affected employees reenter the workplace, among other things.

The agencies recommend steps banks should take to proactively prevent disruption of operations, minimize contact between staff and customers, and plan for how affected employees reenter the workplace, among other things.

Federal Reserve Chairman Jerome Powell told senators that the central bank is willing to explore a credit-sensitive interest benchmark in addition to the secured overnight financing rate, which some banks say could cause problems during economic stress.

In a letter to CFPB Director Kathy Kraninger, the Democratic senators argue that task force members cannot be trusted to protect consumers because they have represented payday lenders or Wall Street banks, or worked at law firms that did so.

The central bank’s top regulatory official laid out a comprehensive set of proposals to update how the agency supervises banks — particularly large institutions — with an eye toward improving transparency.

Todd Zywicki, a law professor who has sharply criticized the CFPB as an unaccountable bureaucracy, has been named chair of an agency task force identifying potential conflicts and inconsistencies in consumer finance law.

The two agencies have delayed the deadline for the public to respond to a request for information on the rating system used to score banks' overall health.

The two Democratic senators said the bureau's policy could allow companies to circumvent consumer finance laws.

A report from the Financial Stability Oversight Council cited a bigger share of originations and servicing by nonbanks as a potential vulnerability in the financial system.