Policy
CSBS supports state regulators in advancing the system of state financial supervision by ensuring safety, soundness and consumer protection; promoting economic growth; and fostering innovative, responsive supervision. The content in the Policy Section describes the positions of CSBS on legislation, regulations and guidance in advancing these objectives.
Featured
As the administrative record makes clear, the FDIC’s corporate governance proposal is ill-conceived and must be withdrawn. The FDIC’s rule would impose a one-size-fits-all mandate on institutions that would intrude on over a century of state fiduciary laws.
Comment Letter
CSBS believes this review is long overdue, and we stand ready to assist as you undertake the processes mandated by the Dodd-Frank Act.
All Issues
Clear bank merger standards are critical to attracting investment, encouraging competition, and supporting growth, ultimately enabling beneficial transactions and helping to preserve the community bank business model.
Although risks related to excessive reliance on third-party funding persist, technology has significantly reshaped bank funding practices.
Although maintaining the financial system’s integrity is paramount, compliance resources must also be well-targeted and deployed according to risk. The current BSA/AML framework does not meet this standard.
An effective partnership with the Consumer Financial Protection Bureau (CFPB) promotes consumer protection, consumer choice, innovation, and competition.
As community banks grow, they are increasingly subject to complex requirements designed for larger institutions. This misalignment creates disproportionate compliance costs that divert resources away from lending and community investment.
Financial services companies face a host of significant cybersecurity threats from various domestic and foreign threat actors. CSBS supports adoption of robust state data security laws, develops cyber exam resources, and provides numerous training opportunities for state examiners.
State regulators support the formation of new financial institutions and welcome de novo applications.
The central question in National Association of Industrial Bankers v. Weiser is how to interpret where a loan is “made” under Section 525 of the Depository Institutions Deregulation and Monetary Control Act (“DIDMCA”) when the lender and borrower are in different states.
A robust state pathway for payment stablecoin issuers is critical to maintain dynamic supervision of payment stablecoin issuers, better protect consumers who purchase stablecoins, and support innovation in this developing market.
In 1996, with overwhelming support, Congress amended the FDI Act to require that one of the positions on the FDIC Board be held by someone “whom shall have State bank supervisory experience.” However, this statutory requirement has gone unfulfilled since 2012.
In 2022, the Fed issued guidelines for how it would evaluate master account applications from a range of entities, including traditional banks, trust companies, and non-FDIC-insured (“uninsured”) “novel” charters. These guidelines created structural inequities among similarly situated uninsured institutions.
Efforts by the Fed to modernize and improve discount window operations are welcome and essential to ensuring it can serve as an effective “lender of last resort.” At the same time, any policy reforms to the discount window should avoid undermining the FHLBs’ important liquidity role.
CSBS has long maintained that the largest firms should be subject to clear, rational, and appropriately calibrated heightened standards that promote financial stability, a competitive banking system, and regulatory and supervisory transparency.
2024 proposed revisions by the CFPB to the mortgage servicing rules under RESPA/Regulation X create uncertainty and ambiguity regarding how processes and protections under various state laws will interact with the federal framework going forward.
Wholesale preemption of state laws poses risks to consumers and financial stability. The OCC has failed to adhere to the strict requirements established by Congress, inappropriately shielding national banks from state consumer financial laws that apply to similarly situated state-chartered banks and state-licensed nonbank firms.
Bank-TSP relationships have grown in importance and scale, especially for community banks, and clear, actionable, and operational guidance from regulators is critical for banks to successfully navigate complex third-party relationships while meeting their compliance obligations.