By J. Preston Carter,
J.D., LL.M.
In a letter to the federal financial regulators, American
Bankers Association President and CEO Frank Keating is asking the Federal
Financial Institutions Examination Council to explain its policy for examining
and supervising financial institutions in the initial months after the
TILA-RESPA integrated disclosure (TRID) rule becomes effective. The Consumer
Financial Protection Bureau recently finalized the extension of the TRID rule’s
effective date to Oct. 3, 2015.
Keating’s letter points out that the CFPB indicated regulators
will be sensitive to the good-faith efforts of lenders to comply with the TRID
rules in a timely manner. Keating asks the FFIEC to “formally establish a
transition period and clarify how regulators will oversee and examine regulated
institutions for TRID compliance during this time.” By doing so, he continued,
the FFIEC would “provide needed certainty to the credit markets and encourage
lenders to continue to provide mortgage credit to qualified borrowers.”
Bankers will be more likely to maintain credit flows, said
Keating, if they have greater assurance that supervisory reviews will reflect
consideration of factors such as the dates compliance systems were received, operational
problems that required debugging efforts, the extent to which necessary
training was possible before systems are fully operational, and the adequacy
and reasonableness of training programs once systems are functional. Keating
contends that “in light of the volume, intricacies and delays associated with
the TRID regulations, the only way to realistically ensure an orderly
transition is to confirm that supervisory standards work in tandem with lender
efforts to refine and debug systems following the effective date.”
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