STATE GOVERNMENT RELATIONS
House Bill 1109 - Registration of Telemarketers
Author: Rep. Matt Lehman, R-Berne
Summary: This bill amends the law requiring telemarketers to register with the Office of the Attorney General (registration law) as follows: (1) It provides that a seller is not subject to the registration law solely because the seller makes or will make a solicitation in a telephone call that is exempt from the Do Not Call statute. (2) It restores conditions removed by P.L.242-2019 that limit application of the registration law to sellers that make certain types of solicitations. (3) It provides that a solicitation occurs for purposes of the registration law only in a telephone call made by a seller.
Latest Action: The bill was heard in the Senate Utilities Committee on Feb. 13 and voted out of committee. The bill now moves to second reading in the Senate.
Senate Bill 350 - Central Indiana Regional Development Authority
Author: Sen. Travis Holdman, R-Markle
Summary: The bill authorizes counties and municipalities within the Indianapolis metropolitan area to establish a central Indiana regional development authority pilot that will sunset on July 1, 2025. It requires counties and municipalities that wish to establish the development authority to adopt substantially similar resolutions to adopt a preliminary strategic economic development plan (preliminary development plan). It provides that the development authority shall be governed by a strategy committee composed of members selected according to the terms of the preliminary development plan adopted to establish the development authority. The bill specifies the duties of the development authority. The bill requires the development authority to prepare a comprehensive strategic economic development plan. The bill amends the definition of "economic development projects" under the local income tax statute. The bill codifies the establishment and governing provisions of the Indianapolis metropolitan planning organization.
Latest Action: Senate Bill 350 is scheduled to be heard in the House Ways and Means Committee on Feb. 19.
Senate Bill 395 - Uniform Consumer Credit Code
Author: Sen. Eric Bassler, R-Washington
Summary: This bill amends the Uniform Consumer Credit Code (UCCC) as follows: (1) Changes: (A) from July 1 of each even-numbered year to January 1 of each odd-numbered year the effective date for the adjustment, based on changes in the Consumer Price Index, of various dollar amounts set forth in the UCCC; and (B) the corresponding date that precedes the adjustment date and by which the Department of Financial (DFI) must issue an emergency rule announcing the adjustment. (2) For an agreement for a consumer credit sale entered into after June 30, 2020: (A) authorizes a seller to contract for and receive a nonrefundable fee based on the amount financed, in addition to the credit service charge and any other authorized charges and fees; and (B) prohibits precomputed consumer credit sales. (3) Repeals a provision concerning the credit service charge for revolving charge accounts and relocates the language to the provision concerning the authorized credit service charge for consumer sales. (4) For an agreement for a consumer loan entered into after June 30, 2020: (A) re-designates the authorized "nonrefundable prepaid finance charge" as an authorized "nonrefundable fee" and changes the amount of the authorized fee from $50 to an amount based on the amount financed, in the case of a consumer loan not secured by an interest in and; and (B) prohibits precomputed consumer loans. It changes from $1.50 to $3.00 the amount of the fee that a lessor in a rental purchase agreement may impose for accepting rental payments by telephone. It also makes conforming technical amendments throughout the UCCC to reflect the bill's changes.
Latest Action: Senate Bill 395 is scheduled to be heard in the House Financial Institutions Committee on Feb. 18.
FEDERAL GOVERNMENT RELATIONS
Quarles Makes Case for Fed Supervision Revamp
Taking note of the inherent tension in bank supervision between the need for confidentiality and tailoring on one hand and accountability and predictability on the other, Federal Reserve Vice Chairman for Supervision Randal Quarles Tuesday elaborated on his plans to revamp how the Fed supervises banks.
"I don’t believe the Federal Reserve has communicated as clearly as it could with the banks we supervise," Quarles said in a speech in New Haven, Connecticut. "More transparency and more clarity about what we want to achieve as supervisors and how we approach our work will improve supervision."
Quarles provided a deeper conceptual framework for a set of reforms outlined in a different speech last month that he plans to "implement expeditiously." They include: aligning supervisory portfolios with newly tailored regulations; creating a searchable database of all significant agency rules and interpretations; putting supervisory guidance out for public comment; increasing stress test transparency; and adopting a formal rule on the use of guidance in the supervisory process.
Fed’s Powell: Financial System 'Generally in a Good Place'
Federal Reserve Chairman Jerome Powell told House lawmakers Tuesday that the U.S. financial system is "strong, and has been materially strengthened since the financial crisis." Testifying before the House Financial Services Committee, he noted that banks today are well-capitalized and highly liquid, and that as a result of the post-crisis regulatory framework, the financial system is "generally in a good place."
When asked what he viewed as the most significant risk facing the financial system, Powell flagged cyber-attacks as a major concern for the central bank. "We have a great game plan for traditional issues like bad loans…[Cyber] is really the frontier where you worry."
Powell fielded questions from lawmakers on a wide range of issues from climate change to the effort to update and modernize Community Reinvestment Act regulations.
Powell: Separate CRA Plans Would Work
Federal Reserve Chairman Jerome Powell told the Senate Banking Committee that diverging regulatory paths on Community Reinvestment Act reform wouldn't harm Fed-regulated banks. In his second day of congressional testimony, Powell noted that the OCC-FDIC reform proposal would allow certain community banks to continue using the current system, so Fed-regulated banks would be in a similar position if it doesn’t join with those agencies on a final rule.
The OCC-FDIC plan, which is open for comment through March 9, includes a provision that would allow community banks with $500 million or less in assets to opt into the revised framework. The Fed could still join in on an interagency final rule. Powell told the House Financial Services Committee on Tuesday that the Fed hasn't yet adopted a CRA plan and that he is comfortable with Fed Governor Lael Brainard's approach. Brainard last month laid out the Fed's efforts to develop new CRA metrics and tests.
Before the Senate panel, Powell also discussed the challenges of low inflation and interest rates in setting monetary policy. He said the Fed plans to update its policy framework to ensure it continues to have tools to address economic downturns.
Quarles Floats Technical Changes to Liquidity Regulation, Supervision
In remarks in New York last week, Federal Reserve Vice Chairman for Supervision Randal Quarles suggested that making reserves and Treasury securities more interchangeable from a liquidity regulation and supervision perspective could help improve the efficiency of the financial system and prevent sudden liquidity crunches in the markets, such as those that occurred last September.
He proposed several approaches that he said "do not involve any decrease in banks’ liquidity buffers" but that would "[facilitate] the use of [high-quality liquid assets] beyond reserves to meet the immediate liquidity needs projected in banks’ stress scenarios." Quarles discussed the role of the discount window in providing emergency liquidity and potentially equalizing the preference for treasuries over cash for purposes of contingent liquidity and supervisory liquidity buffers.
Another potential approach could be to set up a new program or facility, such as a standing repurchase agreement - something the Fed has previously explored - but Quarles added that "there may be benefits to working first with the tools we already have at our immediate disposal."
He also addressed criticism from industry stakeholders about the surcharge for global systemically important banks - specifically, that its partial dependence on year-end inputs has exacerbated some of the liquidity challenges in the market. Based on a preliminary analysis, he said the data may support switching those inputs to averages and that the Fed is "actively considering" taking action to do so.