The Federal Reserve, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency issued notices Friday to postpone current regulatory capital rules for the Basel Committee on Banking Supervision until an unspecified date.

The Basel III news should come as no surprise to HousingWire readers that the United States is making little progress in adopting the draft regulations. Critics often state that the implementation of Dodd-Frank protocols take precedent.

Originally, banking companies were supposed to meet a Jan. 1, 2013 deadline, which would safeguard against a 2008 credit crisis repeat. However, because of  ‘the volume of comments received and the wide range of views,’ the agencies delayed an effective date.

Big banks have found the draft regulations process challenging because of other agreements that have come across the table, such as the Dodd-Frank Act. As a result, Basel III keeps getting pushed to the side. 

“As members of the Basel Committee on Banking Supervision, the U.S. agencies take seriously our internationally agreed timing commitments regarding the implementation of Basel III and are working as expeditiously as possible to complete the rulemaking process,” the OCC, FDIC and Federal Reserve said in a joint statement. 

The statement continued, “As with any rule, the agencies will take operational and other considerations into account when determining appropriate implementation dates and associated transition periods.”

In regards to housing, lenders and investors and borrowers in the residential, commercial and multifamily real estate industry would have felt tighter credit and higher costs had the Basel III gone into effect at the start of the year, said president and CEO David H. Stevens of the Mortgage Bankers Association.

“It is critical now that regulators re-propose Basel implementation rules that more appropriately allocate risk-weights on real estate-related assets, whether they be residential, commercial or multifamily loans and securities and/or servicing rights.” 

He added, “Otherwise, credit for real estate transactions will tighten and consumer and borrower costs will go up, as banks reduce their real estate lending and mortgage servicing business.”

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