On December 28, 2016, the OCC posted its final rule to prohibit national banks from dealing in or investing in industrial or commercial metals. This rule was proposed by the OCC in September 2016, and was approved in substantially the same form as the proposal.
Two developments signal for the first time in my memory a cut back in bank powers. The Fed is restricting physical commodities activities and merchant banking activities in its proposed rule just below. In the same vein, the OCC is restricting national bank activities in industrial metals—i.e., copper. These proposals are reversing decisions made many years ago and have seemingly operated without any appreciable losses to the banking industry. The Fed is exempting certain banks from the full range of capital requirements and stress test is a proposed rule.
The OCC published a proposed rule dealing with qualified financial contracts and their effect on the U.S. financial system. The proposal is similar to a rule proposed by the Federal Reserve earlier this year. In essence, QFCs will be required to contain provisions that restrict acceleration and contain contractual stay provisions. FinCEN is proposing to expand its requirements for AML programs to banks that are not currently subject to federal supervision.
Old acronyms die hard. No less an authority than a senior attorney at the Federal Reserve Bank of New York advised me that no one calls the Bureau of Consumer Financial Protection the BCFP—even though this is what it is called in the Dodd-Frank Act. Instead, even the agency refers to itself as the CFPB. Accordingly, we will get in step for future entries, as we have with the Met Life Building, the Ed Koch Bridge, and Kennedy Airport. A rose by any other name would smell as sweet. The OCC continues to study its leveraged lending guidelines. Foreign swap transactions executed in the U.S. will benefit from some exemptions. The healthy dividend paid by the Fed to the member banks will be cut back based on new law adopted in January.