Community Banks

  • Capital Rules: FDIC teleconference for community banks, Aug. 15, 2013. Dial-in and presentation slides available here.

Debit Cards/Interchange Fees

  • Federal district court vacates Federal Reserve's rules on interchange transaction fees and network non-exclusivity in NACS v. Board of Governors, Civil Action No. 2011-2075, Mem. Op. (D.D.C. July 31, 2013), available here.
  • Court stayed its remedy, meaning current rules remain in effect but lifespan to be decided in further briefing. Court indicates stay would be months, but not years. Status conference on Aug. 14, 2013.
  • Rationale:
  • Rule on interchange fee vacated because Federal Reserve incorrectly included fixed ACS costs, network processing fees, transaction monitoring costs, and an allowance for fraud losses in the costs it was allowed to take into account under Durbin Amendment.
  • Rule on network non-exclusivity vacated because statutory non-exclusivity requirement applies on a per-transaction rather than per-card basis.

The Economy

  • FOMC meeting, July 31, 2013
  • Statement available here.
  • Bond purchasing program to remain in effect: $45 billion in longer-term Treasury securities and $40 billion in agency MBS each month.
  • Target range for federal funds rate remains 0-¼% and will remain so until unemployment falls to 6.5% or below.  

Student Loans

  • Congress passes bill with new rates on student loans, the Bipartisan Student Loan Certainty Act of 2013, H.R. 1911, available here.
  • Fixed rate to be set annually on June 1 and to apply to loans made on July 1 or thereafter: yield on 10-year Treasury note at last auction before June 1 plus statutory add-on with cap on total rates. For loans made between July 1, 2013, and June 30, 2014, applicable 10-year Treasury yield is 1.81%.
  • Stafford undergraduate loans: 2.05% add-on with 8.25% cap.
  • Stafford graduate student loans: 3.6% add-on with 9.5% cap.
  • PLUS loans: 4.6% add-on with 10.5% cap.


  • FDIC teleconference, Aug. 15 (see above).  


  • Constitutional challenges to Title X of the Dodd-Frank Act and to the recess appointment of Richard Cordray are dismissed in State National Bank of Big Spring v. Lew, Civ. Action No. 2012-1032, Mem. Op. (D.D.C. Aug. 1, 2013), available here.

Housing/GSE Reform

  • Markup: Sen. Banking Comm. approves S. 1376, "FHA Solvency Act of 2013," July 31, 2013. Draft and related material are available here.
  • For comparison purposes,
    • Corker-Warner bill, S. 1217, available here.
    • H.R. 2767, "Protecting American Taxpayers and Homeowners (PATH) Act of 2013," original version available here.

Bank Closings

  • First Community Bank of Southwest Florida, Fort Myers, FL
  • Deposits assumed by C1 Bank, St. Petersburg, FL  

Too Big to Fail

  • Proposed supervisory guidance on stress testing for mid-size banks issued by Federal Reserve, FDIC, and OCC (July 30, 2013). Release available here. ◦Comments due Sept. 25, 2013.
  • Constitutional challenges to Titles I and II of the Dodd-Frank Act are dismissed in State National Bank of Big Spring v. Lew, Civ. Action No. 2012-1032, Mem. Op. (D.D.C. Aug. 1, 2013), available here.

Congressional Activity

  • July 30
  • Hearing, Sen. Banking Comm., "Managing Systemic Risk in Financial Markets through Wall Street Reform."
  • July 31
  • Markup, Sen. Banking Comm., S. 1376, "The FHA Solvency Act of 2013" (see above).  

Upcoming Events

  •  Aug. 14
  • Status conference in NACS v. Board of Governors (see above).
  • Aug. 15
  • FDIC teleconference for community banks on capital rules (see above).

Regulatory Comment Deadlines

  • Aug. 21 – CFTC: Exemptive Order relating to cross-border swap activities.
  • Aug. 21 – SEC: Cross-border security-based swap transactions.
  • Aug. 27 – Federal Reserve: data collection requirements for certain money market instruments.
  • Sept. 9 – CFTC, other agencies: Exemptions from appraisal requirements for certain high-priced mortgage loans.
  • Sept. 17 – SEC: Money market reforms.
  • Sept. 25 – Federal Reserve, FDIC, OCC: Stress Test Guidance for Medium-Sized Firms.
  • Sept. 27 – BCBS: Capital treatment of bank exposures to central counterparties. Non-internal model method for capitalising counterparty credit risk exposures.
  • Sept. 30 – FSB: Principles for an Effective Risk Appetite Framework.
  • 60 days after publication – FRB, FDIC, OCC: Market risk capital rules.
  • Oct. 4 – BCBS: Capital requirements for banks' equity investments in funds.
  • Oct. 11 – BCBS: Discussion paper, "Balancing risk sensitivity, simplicity and comparability."