Late Friday (July 6), the Federal Reserve issued a joint statment on implementation of “the Crapo Act,” or, as its principal authors christened it, the “Economic Growth, Regulatory Relief, and Consumer Protection Act.”
The statement itself was written in regulationese — though perhaps this befits any comment on a piece of legislation that infelicitously acronyms out to “EGRRCPA.” The Fed was joined in the statement by the Federal Deposit Insurance Corporation and the Comptroller of the Currency. The regulators outlined which provisions of the Crapo At will take immediate effect, and which will require further regulatory action.
After reassuring the public (read: themselves) that their agencies “will continue” to enjoy vast discretion in oversight of the financial system, the
Good news: modification of the Volcker Rule will take effect immediately, freeing most institutions with total assets of less than $10 billion from the constraints of the Volcker Rule. The regulators way of expressing this was to say that their institutions “will not enforce the final rule implementing section 13 of the BHC Act in a manner inconsistent with the amendments made by EGRRCPA to section 13 of the BHC Act.”
Less good news: two of the more significant areas of regulatory relief for community banks — the respective increases in thresholds for the small bank holding company policy statement, and the off-ramp regarding mortgages and mortgage-backed securities — will await regulation re-writes.
That said, the statement doesn’t constitute a proverbial “two steps back.” Just, “two steps yet to come.”