Bank Regulation

Trump Weighs In On Cordray At Community Bank Meeting

In the continuing faceoff between the Trump administration and the Consumer Financial Protection Bureau (CFPB), the American Banker stated that President Donald Trump “deeply impressed” a group of community bankers at a Thursday meeting.

That impression apparently came amid a give-and-take session where the president showed his “willingness to pull out all the stops” to help those banks attain relief from regulations governing the banking industry.

And one topic that came up, reported the banker, was Richard Cordray, the director of the CFPB, whose job, as well as the executive structure of the agency, are under scrutiny and court battles. In that line of questioning, the commander in chief mused that he was “being urged” to fire Cordray but “wondered if it was worth it” in terms of political fallout.

As has been previously reported, the director’s own term is set to expire next year. The very constitutionality of the director’s independence has been and will continue to be tested amid a labyrinth of court rulings in a case between the CFPB and mortgage lender PHH. A court filing with the U.S. Court of Appeals for the District of Columbia Circuit earlier this month has signaled that the Justice Department signaled that it will file a “friend of the court” briefing by March 17. Courts last month handed down a decision that in turn vacated a previous panel ruling. At that time the CFPB’s structure was ruled unconstitutional. Arguments over structure hinge on Cordray’s directorship versus a multi-member panel at the agency’s helm.

As for the banking issues, at large, Trump mused, per the banker, on whether some problems could be solved via executive orders or, alternatively, by new appointees at regulatory agencies. An issue pointed out by meeting participants as being of interest to Trump and his audience revolved around “qualified mortgage” loans that are typically held by banks in portfolios. Other lines of discussion touched on banking reforms, including Glass-Steagall.

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