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Too-Big-To-Fail
Justice’s Holder Says Megabank Size Inhibits Prosecution
U.S. Attorney General Eric Holder told Congress that the size of the largest financial institutions is inhibiting Justice Department prosecutions on Wall Street. Testifying before the Senate Judiciary Committee, Holder said that law-enforcement officials have hesitated to pursue financial wrongdoing at the megabanks because of the potential economic impact.
Holder
said that the size of too-big-to-fail financial institutions and their effect on federal prosecutions is something that policymakers “need to consider.” “It has an inhibiting impact on our ability to bring resolutions that I think would be more appropriate,” he said, according to news reports.
Holder’s comments followed a January episode of “Frontline” that similarly found that Justice officials hesitated to advance criminal charges on Wall Street because of prosecutor concerns. The assistant attorney general of the department’s Criminal Division, who has since left the department, said he has lost sleep worrying about the result of such a lawsuit on the financial system as a whole.
In a blog
post on the Frontline episode, ICBA President and CEO Cam Fine wrote that this is a textbook definition of the problem of too-big-to-fail. “These financial firms are so large and so interconnected that they not only have access to lower-cost funding and to a seemingly limitless taxpayer backstop, but they are also immune from criminal prosecution,” Fine wrote. “Too-big-to-fail firms should be downsized and split up.”
Advocacy
Plan for Prosperity Key Issue as Convention Nears
With the 2013 ICBA National Convention and Techworld
coming up next week, community bankers headed to Las Vegas and staying home can learn more about one of the key topics of discussion—ICBA’s Plan for Prosperity. The new regulatory-relief agenda for the 113th Congress is not a single bill, but a flexible, living document that can be quickly adopted as legislation.
ICBA’s “Be Heard” advocacy website offers fact sheets and frequently asked questions on the plan, which includes regulatory-relief provisions designed to ease the burden on community banks to help them serve their communities. The plan includes high-priority provisions to exempt community banks from new regulations, and several provisions have already been introduced in the 113th Congress.
Visit “Be Heard”
for more information on the plan, and stay tuned to ICBA’s convention website to monitor next week’s convention in Vegas.
ICBA NewsWatch Today is sponsored by CNA:
ICBA
Member Milestones, brought to you by CNA, recognizes community bank anniversaries and milestones in the March issue of Independent Banker magazine. CNA understands it takes more than a strong balance sheet to run a successful bank. It takes commitment to the community, dedication to service and flexibility to meet the needs of clients. For more than 100 years, CNA's professionals have worked to build strong relationships and solid business insurance solutions that meet the needs of their clients. For more information on CNA’s programs, visit www.cna.com/communitybanks.
Convention
ICBA Twitter Contest Offers Free 2014 Convention Registration
Want to go to the 2014 ICBA Convention and Techworld in Honolulu, Hawaii, for free? Follow these instructions for your chance to win:
- Be a Twitter user or sign up for Twitter at www.twitter.com.
- Follow us @ICBA.
- Tweet
during the 2013 ICBA National Convention and Techworld in Las Vegas using the hashtag #ICBALV13.
The deadline to enter is noon (Eastern time) Thursday, March 21. The winner will be announced the next day via ICBA’s Twitter handle. For contest specifics, check out the social media section of the ICBA convention website.
Important: Please make sure you are easily identifiable through your Twitter account. For example: include your bank name, title, first and last name, and/or a head shot.
Regulation
OCC Issues Guidance on Investment Fund Rule
The Office of the Comptroller of the Currency
released guidance on a final rule revising requirements on national banks and thrifts that offer short-term collective investment funds (STIF). The final rule, which takes effect July 1, requires banks that manage STIFs to disclose information about the funds and their portfolio holdings to the OCC within five business days after the end of each month.
To facilitate this reporting requirement, the OCC established a secure file transfer protocol (FTP) website and created a standardized data collection template. Banks and FSAs that offer STIFs must request access to the FTP site and are encouraged to visit the OCC’s Asset Management STIF website for registration information. The first monthly disclosures are due to the OCC by Aug. 7.
Credit Unions
State-by-State Credit Union Data Shows Q4 Growth
The National Credit Union Administration released its state-by-state data for the fourth quarter of 2012, which was marked by growth in federal credit unions’ assets and loans. Nationally, return on average assets at federally insured credit unions was 86 basis points in 2012, up from 67 basis points in 2011, and rose in 45 states and all territories. Total loans outstanding grew at an annual rate of 4.6 percent in the fourth quarter, with 44 states and Washington, D.C., reporting positive loan growth.
Congress
Committee Hearing on CFPB, SEC Nominees Next Week
The Senate Banking Committee will meet next week to consider the nominations of Richard Cordray for director of the Consumer Financial Protection Bureau and Mary Jo White for chairman of the Securities and Exchange Commission. Cordray and White are scheduled to testify at the hearing, which is scheduled for 10 a.m. (Eastern time) Tuesday, March 12.
Economy
Private-Sector Employment Up 198K
Private-sector employment increased by 198,000 jobs in February, according to the ADP National Employment Report. Small businesses added 77,000 jobs, while medium and large businesses added 65,000 and 57,000, respectively. The goods-producing sector added 34,000 jobs, while the services sector added 164,000. The January 2013 report, which previously reported job gains of 192,000, was revised upward to 215,000 jobs.
Economy
Factory Orders Down 2 Percent
New factory orders declined 2 percent in January, the Commerce Department reported. The decrease followed a 1.3 percent increase in December. Excluding transportation, new orders increased 1.3 percent. Shipments were down 0.2 percent.
Financial Literacy
Jump$tart Coalition Recognizes Sen. Kay Hagan
The
Jump$tart Coalition for Personal Financial Literacy selected Sen. Kay Hagan (D-N.C.) as the winner of its 2013 Federal Leadership Award. Hagan was cited for her ongoing efforts to promote financial literacy at the state and national levels. This and other awards will be presented at the Jump$tart Coalition’s annual awards dinner on Tuesday, April 23.
Advocacy
Register Now for 2013 Washington Policy Summit
ICBA is encouraging community bankers to join colleagues from across the nation at the 2013 ICBA Washington Policy Summit. At the advocacy conference, scheduled for April 24-25 in Washington, D.C., community banks will engage their members of Congress and regulators on important policy issues and hear firsthand from the nation's top banking and financial leaders. More information on the summit, including how to register and what’s on the schedule, is available on 2013 ICBA Washington Policy Summit website.
Poll
This Week’s Quick Poll
Take this week’s Quick Poll on community bank advocacy, and view results from the previous poll on K-12 in-school bank branches. View the Archive.
Education
Advanced BIS Auditing Seminar in April
ICBA is hosting a hands-on, interactive course on auditing Windows workstations and servers to identify missing security patches, common weak configurations, unsupported operating systems and more. Advanced BIS Auditing,
scheduled for April 22-23 in Minneapolis, will methodically walk through how to use available tools to identify vulnerabilities and the configuration settings needed to harden weak configurations. Register Online.
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