Financial Regulatory Reform: An Overview
This week President Obama unveiled a comprehensive plan to overhaul financial system regulation. The plan is built around proposed reforms designed to meet the following five key objectives:
- Promote robust supervision and regulation of financial firms
- Protect consumer and investors from financial abuse
- Establish comprehensive regulations of financial markets
- Provide the government with the tools it needs to manage financial crises
- Raise international regulatory standards and improve international cooperation.
Details of the Administration’s Plan are outlined in an 80-plus page white paper. The white paper and fact sheets on the five major components of the Plan are posted on the Treasury Department’s website at: http://www.ustreas.gov/news/index1.html.
NAHB staff members are presently reviewing the proposal, but the initial read is that the plan raises some significant concerns for housing finance, including: elimination of the thrift charter and the Office of Thrift Supervision (OTS); questions on the future role of the housing government-sponsored enterprises (GSEs); reassessment of capital requirements (which will probably rise); and increased mortgage lending and consumer regulations. A combination of all these factors could result in reduced government support to the mortgage market.
The document linked here delves into a more detailed preliminary analysis of the plan, and makes note of the fact the Administration has not submitted actual legislative language to accompany the proposal. In short, the Congress will undoubtedly put its own stamp on this topic, and NAHB will have an extended opportunity to try and influence the debate (which is likely to bleed into next year).
Our Advocacy staff will be sharing this same material with the Federal Government Affairs and Housing Finance committees later today and we will keep the members updated as this discussion/debate evolves.
Questions or comments should be directed to Chellie Hamecs or John Dimitri, of NAHB's Housing Finance department. [Return to top]
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