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Inside Washington (06/27/2008)
* WASHINGTON (6/30/08)--Regulators unveiled a standardized version of Basel II for financial institutions that would implement certain approaches for calculating risk-based capital requirements. The framework addresses expanding the number of risk-weight categories to which credit exposures may be assigned; using loan-to-value ratios to risk weight most residential mortgages to enhance the risk sensitivity of the capital requirement; providing a capital charge for operational risk using the Basic Indicator Approach under the international Basel II capital accord; emphasizing the importance of a bank’s assessment of its overall risk profile and capital adequacy; and providing for comprehensive disclosure requirements to complement the minimum capital requirements and supervisory process through market discipline. The rule also would expand risk categories for most financial institutions to 16 from five. Community bankers argue the rule would give larger bankers a competitive advantage over smaller ones because operational risk would be tied to capital levels (American Banker June 27). The Federal Reserve Board is seeking public comment on the rule for 90 days. The National Credit Union Administration has based its credit union prompt corrective action reform proposal on aspects of Basel reform ... * WASHINGTON (6/30/08)--Sen. Charles Schumer (D-N.Y.) is requesting information on IndyMac Bancorp from the Federal Home Loan Bank of San Francisco, the Office of Thrift Supervision and the Federal Housing Finance Board. Schumer is concerned about the company’s loan holdings (American Banker June 27). The senator wants to know if the Federal Deposit Insurance Corp. has verified that the company’s loans meet regulatory guidelines, and whether the FDIC has asked IndyMac to scale down its reliance on brokered deposits. Regulators also may not be ready to prevent a potential IndyMac collapse, he said. Indymac was downgraded by Moody’s Investors Service Tuesday ... * WASHINGTON (6/30/08)--Though she wants a provision for higher conforming loan limits for Fannie Mae and Freddie Mac included in a housing bill, Speaker of the House Nancy Pelosi (D-Calif.) said she will support the measure if House Financial Services Committee Chairman Barney Frank (D-Mass.) gives his approval. The Senate is not expected to accept the higher loan limits in the housing package, though Frank said the higher limits could help the economy. The legislation can and must be approved before the August recess, Frank said. Originally, the bill was expected to pass before July 4. Frank and Senate Banking Committee Chairman Christopher Dodd (D-Conn.) are expected to discuss the bill next week ... * WASHINGTON (6/30/08)--The Community Development Financial Institutions (CDFI) Fund is extending deadlines for the Notice of Award for the 2008 Native American CDFI Assistance program to July 7, and the Community Investment Impact System reporting deadline for the period ending Dec. 31, 2007, to July 11. The CDFI’s public website experienced technical difficulties June 20 and was taken down. It has been restored ...


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