Financial Regulatory Forum

JPMorgan’s massive spending on controls underlines “aggressive” relations with regulators

By Henry Engler, Compliance Complete

NEW YORK, Sept. 24 (Thomson Reuters Accelus) - What was once a more consultative relationship between JPMorgan and its regulators has turned into an environment of aggressive demands to reshape the banking giant, say bankers.

With news the largest U.S. bank has settled one set of charges for $920 million and is bracing for more legal and regulatory scrutiny in the coming weeks and months, insiders say the most noticeable change has been the regulators’ use of “consent orders” to enforce wholesale changes across the institution’s risk management controls and systems. (more…)

Staging “Macbeth” in Manhattan: enforcement in the aftermath of Libor and Standard Chartered

By Justin O’Brien, Thomson Reuters Accelus contributing author

LONDON/NEW YORK, Aug. 31 (Thomson Reuters Accelus) - Despite the lack of commentary from either the White House or federal executive agencies, the Standard Chartered investigation — and the manner in which it was handled — is certain to reignite the festering feud over how to regulate finance. Absent the physical bloodshed, the power struggle for control of banking regulation and how to change its culture finds remarkable parallels in Macbeth, the classic Shakespearean tale of political infighting. As with Banquo’s Ghost, the spectre of Eliot Spitzer and his battles with federal counterparts over the purpose of regulation looms large.  (more…)

COLUMN-Regs, tax breaks expiry to hit U.S. lending: James Saft

(James Saft is a Reuters columnist. The opinions expressed are his own)

By Jim Saft

HUNTSVILLE, Ala., May 25 (Reuters) – With tax credits for house buyers gone and tough new banking regulations on the way, expect lending in the United States to come under significant pressure.

Demand for mortgages, kept artificially high through the end of April by juicy credits for first-time and other buyers, has now crashed and, at least to judge by the fundamentals in the housing market, should stay low. Loans to consumers too will be getting, appropriately, more expensive, at least in part due to costs imposed by new financial regulations, which while if anything not tough enough from a prudential point of view will without doubt make banking less profitable.

Supply of loans to businesses will also be hit, and demand should remain slack.

The upshot is sluggish movement of money through the economy and, believe it or not, a Federal Reserve that keeps interest rates ultra low because of domestic concerns rather than simply because of fragility in Europe.

FACTBOX – Comparing EU and U.S. financial reform

LONDON, May 21 (Reuters) – The U.S. Senate approved a reform of Wall Street on Thursday and President Barack Obama may be signing into law the most sweeping changes to financial rules since the 1930s as soon as next month.

It implements pledges the United States, the European Union and other leading countries in the Group of Twenty made in 2009.

With the United States set to adopt its reform soon — and thus easily meet G20 deadlines — the EU has to play catch-up in some cases. Banks are watching carefully as transatlantic differences are emerging that will affect business models.

Merkel says G20 needs to act on big banks’ influence

BERLIN, Jan 20 (Reuters) – The Group of 20 economic powers needs to develop a set of rules to prevent banks becoming so big that they can hold governments to ransom, German Chancellor Angela Merkel said on Wednesday.

“This year is about implementing the regulations that have been agreed during the G20 process,” Merkel told parliament during a budget debate.

“It is also about finding further regulations, and that applies especially for the G20 meetings … to find ways to prevent banks becoming so big or so complex that they can hold us to ransom again,” she added.

UK expects “satisfactory” deal on new EU watchdogs

A video grab image shows Britain's City minister Paul Myners speaking at a Treasury Committee in London March 17, 2009.      By Huw Jones
LONDON, Nov 4 (Reuters) – Britain said on Wednesday it expects a satisfactory deal on setting up new European Union watchdogs for banks even though a key decision by the bloc’s finance ministers is less than a month away.


Banks under fire in US Congress, Dodd targets fees

Senate Banking Committee Chairman Sen. Chris Dodd listens to testimony at the Senate Banking Committee on Capitol Hill in Washington, July 23, 2009.      REUTERS/Larry Downing (UNITED STATES POLITICS BUSINESS) By Kevin Drawbaugh
WASHINGTON, Oct 19 (Reuters) – Banks could not charge overdraft fees on cash-machine and debit-card transactions unless customers have opted in to an overdraft protection program, under a bill introduced in the U.S. Senate on Monday. (more…)

ECB’s Orphanides: cenbanks need bigger reg role

ECB Governing Council member and Cyprus Central Bank Governor Athanasios Orphanides speaks in an interview with Reuters in Nicosia June 23, 2008. Picture taken June 23, 2008.  REUTERS/Andreas Manolis (CYPRUS)   By Ros Krasny
   CHICAGO, Sept 25 (Reuters) – Reforms that come out of the recent financial crisis should include enhancing the role of central banks in supervising financial firms, a top European Central Bank policy-maker said on Friday. (more…)

BIS-New bank rules help avoid booms, busts-Trichet

ECB-RATES/    BASEL, Sept 7 (Reuters) – New global rules for bank oversight should help ease boom-and-bust cycles and prevent the build-up of asset bubbles, top central bankers said on Monday. (more…)