NACHA Government Relations Update - June 15, 2017

Posted June, 13 2017

NACHA Hosts Capitol Hill Day
On June 8, 2017, NACHA hosted its annual Capitol Hill Day in Washington D.C., facilitating a day-long series of meetings between members of NACHA’s Government Relations Advisory Group (GRAG) and elected officials as well as congressional staff members from the Senate Banking Committee and House Financial Services Committee, representing two Payments Caucuses – the Senate Payments FinTech Innovation Caucus and the Congressional FinTech Payment Technology Caucus. GRAG Members continued their outreach and education efforts regarding the ACH Network with particular emphasis on the value of private sector rulemaking and NACHA’s role in governing the Network. Other discussion topics included an update on Same Day ACH, plans to leverage the ACH to move payments faster/easier for end users, and CHOICE and CLEARR legislation. GRAG members also reminded staffers of the resources that NACHA and our Membership can provide for payments-related training and education. Collectively, the group participated in a total of nine meetings in addition to a breakfast meeting at The Capitol Hill Club.
Treasury Report Highlights Need for Regulatory Relief
On June 12, 2017, The U.S. Department of the Treasury issued its first in a series of reports to President Trump examining the United States’ financial regulatory system and detailing executive actions and regulatory changes that can be immediately undertaken to provide regulatory relief for U.S. financial institutions. 
Treasury issued the report with a press release that stated, “Properly structuring regulation of the U.S. financial system is critical to achieve the administration’s goal of sustained economic growth and to create opportunities for all Americans to benefit from a stronger economy,” said U.S. Treasury Secretary Steven T. Mnuchin. “We are focused on encouraging a market environment where consumers have more choices, access to capital and safe loan products – while ensuring taxpayer-funded bailouts are truly a thing of the past.”
As background, over the past four months, Secretary Mnuchin and other Treasury officials met with hundreds of stakeholders across the financial ecosystem, including NACHA; community, independent, regional and large banks; regulators; FSOC members; consumer advocates; academics; analysts and investors. These listening sessions provided a picture of redundancy, fragmentation, and challenges in the regulatory framework.
The report issued today detailed the following findings:
  • Community financial institutions – banks and credit unions – are critically important to serve many Americans
  • Capital, liquidity and leverage rules can be simplified to increase the flow of credit
  • We must ensure our banks are globally competitive
  • Improving market liquidity is critical for the U.S. economy
  • The Consumer Financial Protection Bureau must be reformed (suggested a legal change allowing the president to fire the bureau's sole director, or said the agency could be restructured into a multiperson commission)
  • Regulations need to be better tailored, more efficient, and effective
  • Congress should review the organization and mandates of the independent banking regulators to improve accountability 
The report also recommended that banks with fewer than $10 billion in assets be exempt from the Volcker rule, along with larger banks that either have a smaller trading portfolio or a higher capital level. It also included provisions to strengthen community bank mortgage lending, ease commercial lending rules that harm small businesses’ and consumers’ ability to borrow.
The next step will be that Treasury and the Administration will begin working with Congress, independent regulators, the financial industry, and trade groups to implement the recommendations advocated in the report through changes to statutes, regulations and supervisory guidance.
On a side note but related to the report: The Senate Banking Committee will hold a hearing with financial regulators on June 22, 2017 to discuss economic growth.
Financial CHOICE Act Clears House
On June 8, 2017, the House passed the Financial CHOICE Act by a nearly party-line vote of 233 to 186 with only one GOP member voting against the bill (Walter Jones of North Carolina). Major provisions of the bill included CFPB reorganization, regulatory relief for community institutions and repeal of the Volcker rule. The bill now heads to the Senate where it will likely be broken up into smaller pieces and passed as part of a U.S. competitiveness initiative. Vote counts can be seen here.
Legislative Tool Kit
House 2017 Calendar
Senate 2017 Calendar
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