Banks Declare Peace With Consumer Bureau Over Regulating Nonbanks

American Banker
August 25, 2011
Davidson, Kate

In an unexpected move, the financial services industry is coming to the defense of the Consumer Financial Protection Bureau. While still wary of the agency's initiatives, banks are solidly on its side in terms of regulating the competition. In comment letters on the new regulator's options for supervising nonbanks -- including payday loan providers and nonbank mortgage lenders -- banking trade groups uncharacteristically urge the bureau to be relentless with its nonbank supervision program and laud CFPB for starting the program early. The American Bankers Association "fully supports the bureau's preliminary efforts to define its nondepository supervisory scope as it prepares for the future exercise of that supervision authority," Virginia O'Neill, senior counsel for the ABA's Center for Regulatory Compliance, wrote in an Aug. 15 letter. "This approach has been a model effort to seek broad, careful, and thoughtful input in the important early stages of developing a rule proposal."
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