Slideshow

'Prudent and logical math doesn't sway voters': Comments of the week

August 30, 2018 10:00 PM

Readers weigh in on bank overdraft policies, react to megabank capital standards, respond to Sen. Heidi Heitkamp's tough re-election bid and more.

A marijuana leaf is displayed at a grow facility in Winnipeg, Canada.

On ways financial institutions can monitor whether they're banking undisclosed marijuana-related businesses:

"If this is really a concern to the Federal Government, they could establish a list (like the FINCEN foreign nationals list) of 'known' MRB's that could be checked by bankers as a part of due diligence. That would make it harder to escape notice by simply finding the bank with the loosest controls. They could also make it possible for bankers to report 'suspected' businesses (under a safe harbor) for vetting by the government."

Related: How to tell if you're banking a pot business

A Fannie Mae logo is pictured outside their headquarters in Washington, DC, on Wednesday, December 29, 2004. Fannie Mae, the biggest provider of money for the U.S. mortgage industry, will sell as much as $4 billion of preferred stock after its regulator said it broke accounting rules and is ``significantly undercapitalized.'' Photographer: Jay Mallin / Bloomberg News

Jay Mallin/Bloomberg News

On a report from the Congressional Budget Office showing that some reform plans to overhaul Fannie Mae and Freddie Mac could increase mortgage rates:

"It is unfortunate that FHA's insurance premiums are not based on actuarial analysis but politics. All GSE Insurance premiums should cover the forecasted losses and be based on externally validated models. This is the problem with government involvement in mortgages - prudent and logical math doesn't sway voters!"

Related: GSE reform could increase costs to borrowers: CBO

Senator Heidi Heitkamp, a Democrat from North Dakota, speaks during a Senate Banking Committee hearing in Washington, D.C., U.S., on Thursday, May 24, 2018. The committee is holding the hearing to look into cybersecurity risks to the financial services industry. Photographer: Aaron P. Bernstein/Bloomberg

Aaron P. Bernstein/Bloomberg

On Sen. Heidi Heitkamp's challenging reelection campaign:

"We need more people in Congress that can think for themselves. The thought that there is a "standard definition" of the views a Democrat or Republican must hold is a major problem for our political system."

Related: After bruising reg relief fight, Heitkamp is fighting to keep her seat

Wall street and red traffic light

On an argument that regulators should resist call from big banks to lower capital requirements:

"Bank returns are below their cost of capital. More capital prevents the lending level that the economy needs. There is a trade-off between very high capital levels and economic activity. Economically, the country is worse off with high capital and restricted lending. There would be less traffic deaths if the freeway speed was limited to 5 mph but everyone would be worse off with this speed limit."

Related: Dear regulators: Don’t loosen megabank capital standards

Businessman pressing an Capital concept button.

Duncan Andison/duncanandison - stock.adobe.com

Another response to the argument that megabanks don't need capital relief:

"We assume that the Bank Policy Institute is one of the “sleekly reformulated lobbying groups” that Rebeca Romero Rainey is calling out. Ms. Romero Rainey argues that attempts to review the efficiency of the post-crisis regulatory regime are unwarranted because, well, more capital is always better. She cites no evidence to reach this conclusion, nor does she acknowledge the harm to the American economy that results from getting it wrong. See our full response here."

Related: Dear regulators: Don’t loosen megabank capital standards

On new rules setting an extended exam cycle for small banks stemming from the regulatory relief law passed this spring:

"There is no good reason for a highly liquid well run bank can't be reviewed biennially or triennially. A single bank failure below $3 Billion is completely insignificant. They still would have to submit quarterly financials that can be monitored off-site by regulators. As long as system-wide penalties for misconduct and wrong doing are swift and severe."

Related: New federal rules allow more banks to benefit from longer exam cycle

Close-up hand of man is holding envelope with money.

VadimGuzhva - stock.adobe.com

On an argument that financial institutions should do more to improve overdraft programs:

"A person should be responsible enough to know if they have money to spend or not. However, if they are not responsible and do not carefully track balances it shouldn't be a pathway for Bank's to gouge them with fees that make up half the institutions revenue. Bank should be risk takers and lenders and not toll fee collectors and meter maids."

Related: It's past time to overhaul overdraft

KittyKat - stock.adobe.com

Another reader weighs in on an argument that banks need to clarify for customers how their overdraft programs work:

"What happened to a person's responsibility to keep track of their purchases and know how much money they have available to them? It is really simple 3rd grade math. If I spend more than I have there is a penalty. I fail to see where this is the banks fault or responsibility to fix."

Related: It's past time to overhaul overdraft

Caucasian business hands holding tablet with business screen

ranczandras/ra2 studio - stock.adobe.com

On an argument that banks can't just focus on millennials and younger generations when they are building digital products and services:

"Digital can save you a car trip to the branch. That's a plus for older customers, who may have mobility limitations. My 70+ mother in law is pretty handy with a smart phone too."

Related: Don’t forget baby boomers in the race to go digital

Credit Report and Magnifying Glass

Feng Yu - Fotolia

On an argument that legislation allowing the credit bureaus to collect information about utility and other bill payments would benefit consumers:

"Sounds like a huge amount of reporting requirements for institutions that are not currently required to report...... the natural result of added requirements and work is that the price of goods and services will go up and the cost will then be passed along to the poor which will be in essence a greater burden on them. There are already plenty of ways to supplement credit scores for institutions that have those desires. Don't force this legislation on the rest of the US."

Related: Risks of credit-scoring bill are overstated