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Daily Financial Regulation Update -- Friday, March 26, 2021

March 26, 2021

By FedACTion Task Force

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Major Developments

Federal Reserve Announces that Temporary and Additional Restrictions on Bank Holding Company Dividends and Share Repurchases Currently in Place Will End for Most Firms after June 30, 2021

March 25, 2021

The Board of Governors of the Federal Reserve System announced that the temporary and additional restrictions on bank holding company dividends and share repurchases currently in place will end for most firms after June 30, 2021, after completion of the current round of stress tests. Firms with capital levels above those required by the stress test will no longer be subject to the additional restrictions as of such date. Firms with capital levels below those required by the stress test will remain subject to the restrictions.

Administration Changes

Appointments/Confirmation Hearings

Department of the Treasury – Janet Yellen (effective January 26, 2021)

Consumer Financial Protection Bureau – Rohit Chopra (Nominee)

Securities and Exchange Commission – Gary Gensler (Nominee)

Small Business Administration – Isabel Guzman (effective March 16, 2021)

Commodity Futures Trade Commission

National Credit Union Administration – Todd M. Harper

Department of Housing and Urban Development – Marcia Fudge (effective March 10, 2021)

Department of Education – Dr. Miguel Cardona (effective March 2, 2011)

Congress

Click here to view the full text of the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), Enacted March 27, 2020.

Click here to view the full text of the Paycheck Protection Program Increase Act of 2020, Enacted April 24, 2020.

Click here to view the full text of the Paycheck Protection Program Flexibility Act of 2020, Enacted June 5, 2020.

Click here to view the full text of the Consolidated Appropriations Act, 2021, Enacted December 27, 2020.  

Click here to view the full text of the American Rescue Plan of 2021, Enacted March 11, 2021.

Click here to view a running list of proposed legislation from the Senate Committee on Banking, Housing, and Urban Affairs, Senate Committee on Small Business and Entrepreneurship, House Committee on Financial Services, and House Committee on Small Business.

U.S. Senate

Committee on Banking, Housing, and Urban Affairs

Chairman Brown: The Economy Grows When We Invest in the People Who Make it Work

March 25, 2021

U.S. Senator Sherrod Brown (D-OH), Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, delivered an opening statement at a hearing titled “American Rescue Plan: Shots in Arms and Money in Pockets.”

Committee on Small Business and Entrepreneurship

Chairman Cardin Lauds SBA Action to Increase Lending Limit in EIDL Program

March 24, 2021

U.S. Senate Committee on Small Business & Entrepreneurship Chairman Ben Cardin (D-MD) issued a statement after the U.S. Small Business Administration announced changes to increase the utility of the Economic Injury Disaster Loan Program.

U.S. House of Representatives

Committee on Financial Services

Hearing - Ending Exploitation: How the Financial System Can Work to Dismantle the Business of Human Trafficking

March 25, 2021

The Subcommittee on National Security, International Development, and Monetary Policy held a hearing titled “Ending Exploitation: How the Financial System Can Work to Dismantle the Business of Human Trafficking.”

Federal Agencies

U.S. Department of the Treasury

Testimony of Kimberly A. Clausing, Deputy Assistant Secretary, Tax Analysis, Before the Senate Committee on Finance

March 25, 2021

Kimberly A. Clausing, Deputy Assistant Secretary, Tax Analysis, gave testimony before the Senate Committee on Finance. In her testimony, Ms. Clausing discussed several issues related to international business tax reform.   

Treasury and IRS Disburse another 37 Million Economic Impact Payments from the American Rescue Plan

March 24, 2021

The U.S. Department of the Treasury, the Internal Revenue Service, and the Bureau of the Fiscal Service announced they are disbursing approximately 37 million payments in the second batch of Economic Impact Payments from the American Rescue Plan. The disbursement brings the total disbursed payments from the American Rescue Plan to approximately 127 million payments worth approximately $325 billion.

Federal Reserve Board

Senior Credit Officer Opinion Survey on Dealer Financing Terms

March 25, 2021

The Board of Governors of the Federal Reserve System released responses to its March 2021 Senior Credit Officer Opinion Survey on Dealer Financing Terms. The survey collected qualitative information on changes in credit terms and conditions in securities financing and over-the-counter (OTC) derivatives markets between December 2020 and February 2021. In addition to the core questions, the survey included a set of special questions about the transition away from LIBOR for U.S. dollar-denominated OTC derivatives.

Speech by Vice Chair Clarida on U.S. Economic Outlook and Monetary Policy

March 25, 2021

Richard H. Clarida, Vice Chair at the Board of Governors of the Federal Reserve System, gave a speech at the 2021 Institute of International Finance Washington Policy Summit titled “U.S. Economic Outlook and Monetary Policy.”

Federal Reserve Bank of New York

Reasonable Seasonals? Seasonal Echoes in Economic Data after COVID-19

March 25, 2021

The Federal Reserve Bank of New York’s Liberty Street Economics blog series released a post titled “Reasonable Seasonals? Seasonal Echoes in Economic Data after COVID-19.”

Office of the Comptroller of the Currency

OCC Reports Decline in Mortgage Performance for Fourth Quarter 2020

March 25, 2021

The Office of the Comptroller of the Currency (OCC) reported that the performance of first-lien mortgages in the federal banking system declined during the fourth quarter of 2020. The OCC Mortgage Metrics Report, Fourth Quarter 2020 showed that 93.3% of mortgages included in the report were current and performing at the end of the quarter, compared to 96.5% a year earlier. The decline is a result of the COVID-19 pandemic and actions taken by banks to comply with the CARES Act.

FINRA

FINRA Alerts Firms to Recent Increase in ACH “Instant Funds” Abuse

March 25, 2021

The Financial Industry Regulatory Authority issued a regulatory notice warning member firms that, over the past two months, it has observed a sharp increase in new customers opening online brokerage accounts and engaging in Automated Clearing House “instant funds” abuse to effect securities trading.

FINRA Announces Updates to the Interpretations of FINRA’s Margin Rule for Day Trading

March 25, 2021

The Financial Industry Regulatory Authority (FINRA) issued a regulatory notice announcing clarifications of interpretations of FINRA margin requirements regarding day trading (Rule 4210(f)(8)(B)(ii)).

National Credit Union Association

Registration Now Open for April 14 Webinar on BSA/AML Compliance

March 25, 2021

The National Credit Union Administration will hold a webinar on April 14, 2021 titled “Bank Secrecy Act Update,” during which federally insured credit unions can get information on Bank Secrecy Act and anti-money laundering compliance.

Federal Housing Finance Agency

FHFA Releases 4th Quarter 2020 Foreclosure Prevention and Refinance Report

March 25, 2021

The Federal Housing Finance Agency released its fourth quarter 2020 Foreclosure Prevention and Refinance Report, which shows that Fannie Mae and Freddie Mac completed 362,912 foreclosure prevention actions in the fourth quarter of 2020, bringing the total number of homeowners who have been helped during conservatorships to 5.588 million. The report also shows that 30% of loan modifications completed in the fourth quarter of 2020 reduced borrowers’ monthly payments by more than 20%. The number of refinances increased from 1.76 million in the third quarter of 2020 to 2.01 million in the fourth quarter of 2020.

U.S. Department of Labor

Labor Department Issues News Release on Unemployment Insurance Weekly Claims

March 25, 2021

The U.S. Department of Labor issued a news release regarding weekly unemployment insurance claims. The release states that, in the week ending March 20, the advance figure for seasonally adjusted initial claims was 684,000, a decrease of 97,000 from the previous week’s revised level; the previous week’s level was revised up by 11,000 from 770,000 to 781,000; the four-week moving average was 736,000, a decrease of 13,000 from the previous week’s revised average, and the previous week’s average was revised up by 2,750 from 746,250 to 749,000.

State Agencies

New York State Department of Financial Services

Superintendent Lacewell Announces Proposed DFS Guidance to New York Insurers on Managing the Financial Risks from Climate Change

March 25, 2021

The New York State Department of Financial Services (DFS) issued proposed guidance for New York-regulated domestic insurers setting out DFS’ expectations related to managing the financial risks from climate change.  

International

UK Financial Conduct Authority

FCA Reminds Consumers Financially Impacted by Coronavirus of the Support Available

March 25, 2021

The Financial Conduct Authority (FCA) issued a release to remind consumers financially impacted by COVID-19 of support available. As the deadline to apply for a payment deferral ends on March 31, 2021, the FCA is reminding consumers in financial difficulty that support will continue to be available under the Tailored Support Guidance.