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ph fedaction financial regulatory updates

Daily Financial Regulation Update -- Wednesday, December 2, 2020

December 02, 2020

By FedACTion Task Force

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Congress

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

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

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

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

Statements at CARES Act Oversight Hearing

December 1, 2020

Senators Mike Crapo (R-ID), Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs (Committee), and Sherrod Brown (D-OH), ranking member of the Committee, delivered opening statements at the hearing titled “The Quarterly CARES Act Report to Congress.”

Federal Agencies

Federal Reserve Board

Speech: Modernizing and Strengthening CRA Regulations: A Conversation with the Chicago Community Trust

December 1, 2020

Lael Brainard, Governor at the Board of Governors of the Federal Reserve System (Board), gave a speech at the Chicago Community Trust titled “Modernizing and Strengthening CRA Regulations: A Conversation with the Chicago Community Trust.” In her speech, Ms. Brainard emphasizes the Board’s support of a broad-based and inclusive recovery from the COVID-19 pandemic and its focus on updating and strengthening Community Reinvestment Act regulations to better meet their core purpose.

Federal Reserve Bank of New York

Speech: A Return to Operating with Abundant Reserves

December 1, 2020

Lorie K. Logan, Executive Vice President of the Federal Reserve Bank of New York, gave remarks before the Money Marketeers of New York University titled “A Return to Operating with Abundant Reserves,” discussing, among other things, the impact the Federal Reserve’s pandemic response had on its balance sheet and reserve balances.

The Costs of Corporate Debt Overhang Following the COVID-19 Outbreak

December 1, 2020

The Federal Reserve Bank of New York’s Liberty Street Economics blog released a post titled “The Costs of Corporate Debt Overhang Following the COVID-19 Outbreak.” The authors show that firms with high levels of borrowing at the onset of the Great Recession underperformed in the following years, compared to similar, but less indebted, firms. Such findings, together with early data on the revenue contractions following the COVID-19 outbreak, suggest that debt overhang during the COVID-recession could lead to an up to 10% decrease in growth for firms in industries most affected by the economic repercussions of the battle against the outbreak.

Federal Deposit Insurance Corporation

FDIC-Insured Institutions Reported Improved Profitability in Third Quarter 2020

December 1, 2020

The Federal Deposit Insurance Corporation (FDIC) reported results from commercial banks and savings institutions that reflect improved profitability from the first and second quarters of 2020, increased liquidity, and strengthened capital levels. As a result, the banking industry remains well positioned to accommodate loan demand and support the economy.