|
Fed to
Consider Paying Interest on Reserves
|
|
The Federal
Reserve's Board of Governors plans to discuss during a closed meeting on Wednesday whether the central
bank should pay interest on bank reserves. Two years ago Congress freed
the Fed to pay interest on bank reserves starting in 2011. A staff
report will be presented on the option, considered as a possible remedy
to current liquidity pressures in financial markets.
|
|
More Progress
Cited over Farm Bill
|
|
Farm bill
conferees said last week that they reached a tentative agreement over
how to finance $10 billion in new farm bill spending, one of
the biggest negotiation challenges for lawmakers. Senate and House
farm bill conferees are also expected to receive today for the first
time a formal copy of a proposed new five-year farm bill. The work of
the full conference committee over the bill is expected to continue for
several days. Conferees said they plan to seek at least another week's
extension to the current $597 billion farm bill, which expired Friday.
However, some congressional observers predicted a final bill may not be
wrapped up until shortly before Memorial Day.
|
|
FinCEN
Proposal Amends CTR Exemptions
|
|
A new proposal by the Financial Crimes Enforcement
Network is designed to simplify Currency Transaction Report exemption
requirements for certain bank customers. FinCEN designed the
proposal to respond to concerns raised in a Government Accountability
Office report earlier this year. The proposal
would eliminate exemption filings for banks, government agencies and
entities acting on government authority.
Banks also would no longer have to file the biennial
exemption renewal or wait 12 months to file an initial exemption for
certain eligible businesses or payroll customers (the so-called Phase
II exemptions under existing rules). The goal is to encourage more
banks to take advantage of exemptions and reduce the filing of
unnecessary CTRs. Comments on the proposal are due June 23.
|
|
House Panel
Clears Abandoned Property Bill
|
|
The House
Financial Services Committee cleared a bill, with a 38 to 26 vote,
to direct $15 billion toward helping state and local housing agencies
and nonprofit groups buy, rehabilitate and reoccupy abandoned foreclosed
homes. The Neighborhood Stabilization Act of 2008 (H.R. 5818) would authorize the Department
of Housing and Urban Development to direct $7.5 billion in
zero-interest loans and $7.5 billion in grants toward quickly
re-occupying properties with new homeowners or renters. Properties
benefiting from the bill's financing must be resold to or house
low-income families. The bill was introduced by Rep. Maxine Waters
(D-Calif.), a House Financial Services subcommittee chairman.
|
|
Credit Cards
Account for More Bank Earnings
|
|
Credit cards
contributed more to bank income last year than any of the previous four
years, according to a report published this month by bank card advisory
firm R.K. Hammer Investment Bankers. Credit cards accounted for 6.9
percent of bank assets and 16 percent of bank earnings last year. For
the last five years, bank earnings from credit card business have been
at least twice as large as the assets they represent.
|
