CRE Finance Council is a trade association that is...

  • Dedicated exclusively to the nearly $6 trillion commercial real estate finance industry
  • Committed to promoting strong & liquid debt markets across platforms
  • The meeting place for industry professionals
  • The platform for establishing best practices, industry standards & federal policy
  • Comprised of 400+ institutional and 18,000+ individual members
Events
More
June 10 - 12
New York

CREFC News

News Archive

News

Presidential Campaigns Agree to Debate … With More Rules

May 21, 2024

In national news
… the Presidents have agreed to debate!

Within minutes of each other on Wednesday, both Presidential campaigns announced that they had agreed to debate, but notably are doing so on their own terms.

  • This will be the first time a debate has occurred outside the purview of the Presidential Commission on Debates, since its formation in 1987.

The first debate will occur on June 27 and will be hosted by CNN in Atlanta, GA.

A debate this early in the year is extremely unusual as neither President Joe Biden nor former President Donald Trump has officially accepted their party’s nomination.

A few conditions were agreed to by both campaigns to hold the debates:

  • No audience will be present. This has been viewed as a win for the Biden campaign, as Trump feeds off of audience reactions.
  • Microphones will be cut off if a candidate speaks out of turn.
  • Any candidates invited must earn 15% in at least four major national polls beginning in mid-March and running through June 20. This likely takes third-party Robert F. Kennedy Jr. out of debate contention as he has consistently polled in the high, single digits as of late.
  • The debates are notably early to ensure that they occur before the start of mail-in and early voting.

The second debate is scheduled for September 10 and will be hosted by ABC. The location of the second debate is still to be determined.

You can read more about debate planning intrigue here.

Contact James Montfort (Jmonfort@crefc.org) with any questions.

Contact 

James Montford
Manager, Government Relations
202.448.0857
jmontfort@crefc.org 

a microphone with exclamation points
The information provided herein is general in nature and for educational purposes only. CRE Finance Council makes no representations as to the accuracy, completeness, timeliness, validity, usefulness, or suitability of the information provided. The information should not be relied upon or interpreted as legal, financial, tax, accounting, investment, commercial or other advice, and CRE Finance Council disclaims all liability for any such reliance. © 2023 CRE Finance Council. All rights reserved.
Presidential Campaigns Agree to Debate … With More Rules
May 21, 2024
In national news… the Presidents have agreed to debate!

News

Banking Regulators on the Hill: Gruenberg and Basel Dominate

May 21, 2024

Last week, financial regulators from the Fed, FDIC, and OCC testified before the House Financial Services Committee (HFSC) and the Senate Banking Committee (SBC).

Why it matters: As we previewed last week, the hearing comes amidst turmoil within FDIC leadership and potential revisions to the Basel Endgame proposal. Regulators briefly mentioned monitoring CRE in their opening remarks but did not engage in detailed discussions on the topic during the hearing.

FDIC and Gruenberg Focus: The majority of the hearings revolved around FDIC Chair Gruenberg and the results of an independent investigation that found pervasive sexual harassment and workplace misconduct at the FDIC. Note: Gruenberg announced yesterday that he will resign upon confirmation of a successor.

  • Republicans called for Gruenberg to step down. Some Democrats harshly criticized him, but most stopped short of calling for his resignation, including HFSC Ranking Member Maxine Waters (D-CA) and SBC Chairman Sherrod Brown (D-OH).
  • Sen. Elizabeth Warren (D-MA) contended that Chair Gruenberg’s resignation would “do nothing to improve the toxic culture at the FDIC,” adding that Republicans calling for his resignation are engaged in a “purely political exercise.”
  • Despite these calls, Gruenberg reiterated his commitment to implementing changes at the FDIC, stating that he is working on overhauling the agency’s culture and processes for addressing workplace misconduct.
  • There are political and policy reasons to keep Gruenberg in place. Without him, the FDIC would lose the majority of Biden appointees and would be unlikely to pass proposals like the Basel Endgame.

What they’re saying: Lawmakers also discussed the Basel III Endgame proposal, inquiring mostly about its implementation and potential modifications.

  • Additionally, Members delved into other recent regulatory actions, including the Fed’s long-term debt proposal and last Friday’s Financial Stability Oversight Council (FSOC) report on nonbank mortgage servicers.

Basel Endgame

  • Chairman Patrick McHenry (R-NC) asked Fed Vice Chair Michael Barr to commit to re-proposing the Basel III rule for notice and comment.
  • Barr responded that the Fed “has not made a decision on process yet” and is mostly focused on “getting the substance right.” Barr indicated in responses to several lawmakers that the Fed is considering “broad and material changes” across all three areas of the proposal, including operational, credit, and market risk.
  • Sen. Mike Rounds (R-SD) argued that broad and material changes would trigger the need for a withdrawal/re-proposal under the Administrative Procedures Act.
  • In both hearings, Barr assured lawmakers the Fed will comply with the law and the Administrative Procedures Act. He reiterated they will turn to the question of an appropriate process once the substance of the proposal is determined.
  • Sen. Mark Warner (D-VA) echoed Sen. Rounds’ concerns, highlighting that much of the opposition to the Basel III proposal stemmed from the lack of evidence-based documentation regarding the cumulative effects of the proposed rule changes. He urged Vice Chair Barr to make these impact estimates public, particularly those related to credit availability.
  • Reps. Brad Sherman (D-CA) and Sean Casten (D-IL) questioned the proposal’s treatment of clean energy tax credits. Rep. Casten specifically asked if regulators support revising the risk weights for tax equity. Chair Gruenberg confirmed the issue received heightened attention and agencies are still reviewing comments.
  • Rep. Ritchie Torres (D-NY) asked Barr if he agreed with Fed Chair Powell’s statement made during a March hearing that the level of capital in the U.S. banking system is “about right.” Barr affirmed the overall banking system is sound and resilient, and noted the Basel III proposal is designed to correct specific weaknesses in the system.

Other topics included rising insurance costs, the regional bank long-term debt proposal, and FSOC’s recent recommendation on nonbank residential mortgage servicers.

  • Sen. Tina Smith (D-MN) addressed the increase in home insurance rates linked to severe weather events caused by climate change. She inquired about the Federal Reserve's efforts in collaboration with financial institutions to manage these risks. Vice Chair Barr responded that the Fed is actively monitoring how major banks are addressing these risks and that conducting exercises with them to gain deeper insights.
  • On the FSOC nonbank mortgage report, Rep. French Hill (R-AR) contended that Dodd Frank has driven the mortgage servicing business away from regulated institutions and toward the nonbank sector. Comptroller Hsu responded to Rep. Bill Foster’s (R-IL) questions on risk that disruptions to services in the nonbank mortgage sector could be severe and negatively impact many people. Rep. Bill Foster (R-IL) expressed concerns about the potential severe disruptions to the nonbank mortgage sector and their negative impact on many people's financial well-being. The discussion around the Basel III Endgame proposal highlights the ongoing scrutiny and potential revisions in regulatory frameworks to ensure the stability and resilience of the banking system amidst evolving market dynamics and policy considerations.

The bottom line: While Vice Chair Barr declined to commit to a Basel re-proposal, he did continue to telegraph material changes to the proposal.

Contact David McCarthy (dmccarthy@crefc.org) and Sairah Burki (sburki@crefc.org) with questions. 

Contact 

Sairah Burki
Managing Director, Head of Regulatory
Affairs & Sustainability
703.201.4294
sburki@crefc.org

David McCarthy
Managing Director, Chief Lobbyist, 
Head of Legislative Affairs
202.448.0855
dmccarthy@crefc.org
magnifying glass examining money
The information provided herein is general in nature and for educational purposes only. CRE Finance Council makes no representations as to the accuracy, completeness, timeliness, validity, usefulness, or suitability of the information provided. The information should not be relied upon or interpreted as legal, financial, tax, accounting, investment, commercial or other advice, and CRE Finance Council disclaims all liability for any such reliance. © 2023 CRE Finance Council. All rights reserved.
Banking Regulators on the Hill: Gruenberg and Basel Dominate
May 21, 2024
Last week, financial regulators from the Fed, FDIC, and OCC testified before the House Financial Services Committee (HFSC) and the Senate Banking Committee (SBC).

News

Supreme Court Rules in CFPB’s Favor 

May 21, 2024

On May 16,
the Supreme Court ruled that the Consumer Financial Protection Board’s (CFPB’s) funding mechanism is constitutional.

  • Specifically, the Court found that CFPB funding through the Federal Reserve (rather than annual appropriations by Congress) is valid under the U.S. Constitution’s appropriations clause in CFPB v. Community Financial Services Association of America.
  • In any given fiscal year, the CFPB can utilize a maximum of 12% of the Fed’s total operating expenses as reported in 2009 and adjusted for inflation. However, Bloomberg reports that the CFPB is getting close to its funding cap.

Why it matters: As reported by Bloomberg, this ruling “ends legal threats to the CFPB’s very existence that have percolated through the courts since Congress created the agency in the 2010 Dodd-Frank Act.”

Market participants believe that this ruling clears the way for a more aggressive CFPB, which has been relatively subdued with only four public enforcement cases in 2024.

What’s next: Litigation related to rules that were on pause will likely start moving forward, including:

  • 1071 Reporting: The small business lending data collection rule has been on hold since last October. Under the final rule, lenders have to collect and report loan application and origination data to small businesses, which, according to the CFPB, includes CRE mortgages;
  • Credit card late fee cap, which was paused in early May.

However, before these rules can be implemented, the CFPB will have to ask the courts for existing injunctions to be lifted. As reported by Bloomberg, “industry group plaintiffs that sued to block the rules will have the chance to ask for fresh injunctions on substantive grounds.”

Please contact Sairah Burki (sburki@crefc.org) or David McCarthy (dmccarthy@crefc.org) with questions.

Contact 

Sairah Burki
Managing Director, Head of Regulatory
Affairs & Sustainability
703.201.4294
sburki@crefc.org

David McCarthy
Managing Director, Chief Lobbyist, 
Head of Legislative Affairs
202.448.0855
dmccarthy@crefc.org
powerful regulator
The information provided herein is general in nature and for educational purposes only. CRE Finance Council makes no representations as to the accuracy, completeness, timeliness, validity, usefulness, or suitability of the information provided. The information should not be relied upon or interpreted as legal, financial, tax, accounting, investment, commercial or other advice, and CRE Finance Council disclaims all liability for any such reliance. © 2023 CRE Finance Council. All rights reserved.
Supreme Court Rules in CFPB’s Favor
May 21, 2024
On May 16, the Supreme Court ruled that the Consumer Financial Protection Board’s (CFPB’s) funding mechanism is constitutional.

We are lenders, investors & servicers.​

Become a Member

CREFC offers industry participants an unparalleled ability to connect, participate, advocate and learn!
Join Now

Sign Up for eNews