The ABA has accused a Federal Reserve proposal of showing a lack of transparency.
ABA has pointed to a lack of transparency in the Federal Reserve’s proposal to assess bank, savings-and-loan and nonbank financial holding companies with over $50 billion in assets for the cost of supervision. The organization said that the proposal, issued under Section 318 of the Dodd-Frank Act, “provides insufficient information” about whether the supervisory activities the Fed proposes to fund truly relate to its oversight of the covered firms.
“Section 318 is clearly based on a direct relationship between the assessment and related supervision costs,” ABA stated. “Those costs must be publicly known and subject to evaluation for the assessments to be valid under the provision.”
ABA believes that supervision and regulation should, when appropriate, be tailored and reflect the different risk profiles of financial institutions, taking into account business models, product offerings and complexity rather than just being based on size.