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In what could be an important step towards needed regulatory updating to accommodate the growing use of artificial intelligence (AI) by financial institutions, the CFPB, FDIC, OCC, Federal Reserve Board, and NCUA issued a request for information (RFI) regarding financial institutions’ use of AI, including machine learning (ML).  Comments on the RFI must be received…

On February 2, 2021, the Federal Reserve (“Fed”) announced that the launch date for its instant payments platform—FedNow—would be sooner than originally expected.  The announcement narrows the delivery timeframe by a full year.

FedNow provides interbank clearing and settlement, which enables funds to be transferred between banks and credited to accounts in near…

On Monday, the FRB, FDIC, and OCC issued a “Statement on LIBOR Transition” that encourages banks to transition away from the London Inter-Bank Offered Rate (LIBOR) as soon as possible, and in any event by December 31, 2021.    

The agencies indicate that the LIBOR administrator has announced it will consult on its intention…

The Biden transition has announced the members of its agency review teams.

The team leaders include the following individuals:

CFPB.  The team will be led by Leandra English, who is currently with the New York Department of Financial Services.  As our blog readers may recall, Ms. English was appointed CFPB Deputy Director by…

The Fed, FDIC, and OCC have issued a “Statement on Reference Rates for Loans” that addresses replacement rates for the London Inter-Bank Offered Rate (LIBOR).  LIBOR, which many creditors currently use as the index for calculating the interest rate on credit cards and other variable-rate consumer credit products, is expected to be discontinued…

On November 10, the Senate Banking Committee will hold a hearing, “Oversight of Financial Regulators.”

On November 12, the House Financial Services Committee will hold a hearing, “Oversight of Prudential Regulators: Ensuring the Safety, Soundness, Diversity, and Accountability of Depository Institutions during the Pandemic.”

The scheduled witnesses at both hearings are:…

The CFPB, OCC, Federal Reserve, FDIC, and NCUA have issued a proposed rule on the role of supervisory guidance.

In September 2018, the agencies issued an “Interagency Statement Clarifying the Role of Supervisory Guidance.”  In response to the Statement, the agencies received a petition requesting a formal rulemaking on the subject.  The proposed…

Regulators Provide Greater Transparency into BSA/AML Enforcement Process.  On August 13, 2020, the Federal Reserve System, Federal Deposit Insurance Corporation, National Credit Union Administration, and Office of the Comptroller of the Currency (the “Agency” or collectively the “Agencies”) issued a joint statement updating and clarifying their 2007 guidance regarding how they evaluate enforcement actions…

A recently-released Federal Reserve Board article, “The Cost Structure of Consumer Finance Companies and Its Implications for Interest Rates: Evidence from the Federal Reserve Board’s 2015 Survey of Finance Companies,” provides strong support for industry’s position that interest rate caps can be harmful to consumers by limiting the availability of small dollar loans.

The…

The Federal Reserve Board recently issued a Service Announcement setting forth the details of its FedNow Service, a new 24x7x365 interbank settlement service with clearing functionality to support instant payments in the United States.

The Fed announced its decision to develop the FedNow Service in a notice and request for comment issued in August 2019. …