"Washington Report 360 | February 8, 2019"

Key highlights

• BB&T Corp. and SunTrust Banks Inc. intend to merge, creating the sixth-largest U.S. bank in terms of assets and deposits.
• The Federal Reserve has suspended stress testing requirements and CCAR for “lower-risk firms,” which are generally firms with assets between $100 billion and $250 billion for the 2019 cycle.
• The CFPB has proposed to rescind the mandatory underwriting provisions of its Payday Lending Rule.

Financial services legislative and regulatory news

The Federal Reserve has taken actions related to stress testing, including:

• Suspending 2019 stress tests and CCAR for “lower-risk firms,” which generally include those with total assets between $100 billion and $250 billion.
• Finalizing a stress testing policy statement, modifying the framework for designing economic scenarios, and expanding disclosure of the supervisory models.
• Planning a public conference in July 2019 focused on stress testing transparency and effectiveness.
• Highlighting future rulemaking based on these changes.

The CFPB released:

• Two proposed rules regarding its Payday Lending Rule that would:
  • Rescind provisions covering mandatory underwriting and ability-to-repay determinations related to certain payday, vehicle title, and balloon payment loans.
  • Delay the compliance date for the mandatory underwriting provisions, currently scheduled in August 2019, until November 2020.
• Frequently asked questions for the TILA/RESPA Integrated Disclosure Rule.

The final compliance date for the New York Department of Financial Services’ cybersecurity rule is March 1, 2019. 

The House Financial Services Committee Chair has released a schedule for February that includes hearings on banking services for cannabis-related businesses, affordable housing, credit reporting oversight, and diversity trends.

The Senate Banking Committee Chair released an outline for housing finance reform legislation. 

Financial services policy news

BB&T Corp. and SunTrust Banks Inc. announced plans to merge; the resulting entity, which would be the sixth-largest U.S. bank in terms of assets and deposits, will be based in Charlotte, NC and operate under a new name. (WSJ)

Federal Reserve Governor Brainard outlined learnings from research forums and other outreach efforts related to the Community Reinvestment Act, highlighting support for the CRA and input on certain reforms, such as tailoring to asset size and business models and increased consistency in evaluations and ratings.

The FSB published its annual report on Non-Bank Financial Intermediation, covering data through the end of 2017 in 29 jurisdictions and focusing on “bank-like financial stability risks.”