A top U.S. banking regulator told the annual Reuters Regulation Summit that he is not aware of any pending deals involving Washington Mutual Inc., the largest U.S. savings and loan. John Reich, director of the Office of Thrift Supervision, also said he expected fewer mergers and acquisitions in the thrift industry in 2008.
The U.S. Office of Thrift Supervision said it had “no formal enforcement action” pending against Countrywide Financial Corp. before the January announcement that Bank of America would buy the subprime mortgage lender.
The U.S. thrift industry was forced to write down loan losses and goodwill in the 2007 fourth quarter due to the subprime mortgage crisis, but the institutions remain fundamantally strong and will rebound in 2008, the head of the U.S. Office of Thrift Supervision told the Reuters Regulation Summit.
Taking a two-week holiday may seem impossible in the hard-driving world of securities traders at big global banks. But such a vacation is a “fundamental audit principle” that all banks should follow because it can help expose any rogue traders, according to Mark Olson, head of the Public Company Accounting Oversight Board. French-based Societe Generale recently disclosed the loss of billions of dollars it blamed on a trader.
What if several U.S. airlines announced merger plans in short order, giving just three airlines control over travel by hundreds of millions of American passengers? Thomas Barnett, the Justice Department’s antitrust chief, told the Reuters Regulation Summit that regulators would not pre-judge such a possibility and would talk to airline customers before deciding whether to approve such a series of mergers.
U.S. banks are taking a closer look at their own internal risk controls and trying to figure out how to prevent the kind of huge trading losses that French-based Societe Generale recently disclosed, according to John Dugan, Comptroller of the Currency. Dugan spoke at the annual Reuters Regulation Summit.
John Dugan, U.S. Comptroller of the Currency, says American banks have “learned the hard way” that they must do their own due diligence and not rely solely on credit rating agency information about securities. Dugan, whose office regulates most of the largest U.S. banks, spoke at the annual Reuters Regulation Summit.
Democratic Sen. Charles Schumer of New York says the recent billion-dollar U.S. investments by sovereign wealth funds are generally positive for American business, but each must be considered on a case-by-case basis. At the annual Reuters Regulation Summit, Schumer said he believed that sovereign funds in the Middle East generally have more “purely economic” interests than those in China or Russia.
The leaders of the U.S. Securities and Exchange Commission weren’t always so closely identified with their political party, Commissioner Paul Atkins said. He told the Reuters Regulation Summit that it’s a fairly new phenomenon for the commissioners to wear their party affiliations on their sleeves. Three Republicans are currently at the helm of the investor protection agency after the two Democrats left in recent months to return to the private sector.
Democratic Sen. Charles Schumer of New York told the Reuters Regulation Summit he was confident that two Senate bills would soon be combined in an attempt to force China to revalue its yuan currency. Separate bills have been proposed by members of the Senate Banking Committee and by members of the Senate Finance Committee. Schumer sits on both panels.