What’s in Dodd Frank??—Title by Title Overview
Not Applicable To Community Banks*
What’s in Dodd Frank??—Title by Title Overview
COLOR CODE
Not Applicable To Community Banks*
May/MayNot Impact Community
Banks* Depending on Implementation Impacts Certain Community Banks*
Applicable To Community Banks*
Title I—Financial Stability—Systemic Risk Regulation and Oversight
Not Applicable To Community Banks
Subtitle A—Financial Stability Oversight Council (FSOC)
—Chaired by Treasury, comprised of 10 voting agencies
—Monitors for systemic threats
—Supervision and regulation over bank holding companies over $50 billion and systemically risky non-bank
financial companies, including higher capital, leverage (15 to 1 limit), liquidity, risk management, etc
Subtitle B—Office of Financial Research
—Support FSOC with research, data collection and analysis
—Funded by BHCs over $50 billion and systemically risky non-bank financial institutions
Subtitle C—Enhanced Federal Reserve Authority
—Subjects systemic risk non-bank financial institutions to Fed supervision and BHCs over $50 billion to
enhanced Fed supervision
—Systemic risk BHCs and non-bank financial institutions to prepare and report periodically on contingent
resolution plans (living wills)
—Systemic risk BHCs and non-bank financial institutions to prepare and report periodically on credit
exposure reports
—Credit exposure limitation for systemic risk BHCs and non-bank financial institutions of 25% ofcapital to
any unaffiliated company
—Annual stress tests for systemic risk BHCs and non-bank financial institutions
—Early remediation requirements for systemic risk BHCs and non-bank financial institutions to avoid
insolvency and harm to financial stability
—Required divestiture of activities or assets to mitigate systemic risk
—FDIC backup exam and enforcement authority for systemic risk BHCs and non-bank financial
institutions
—Risk committees required for publicly traded systemic risk BHCs and non-bank financial institutions
1.
Applicable To Community Banks
—BHC capital rules to be no less stringent than bank capital rules on date of enactment
—Grandfather provision for trust preferred securities issued by BHCs under $15 billion to count
as Tier 1 capital; 3-year phase out for BHCs over $15 billion
—Exception for BHCs subject to the small bank holding company policy statement
Title II—Orderly Liquidation Authority for Systemic Risk Companies
Not Applicable To Community Banks
—FDIC authority to liquidate systemically risky large failing financial firms (BHCs and non-bank financial
companies, including securities firms, broker dealers, insurance companies)
—No use of taxpayer funds to prevent liquidation
—Costs assessed to BHCs over $50 billion and systemically risky non-bank financial institutions
Title III—Transfer of OTS Authority to OCC, FDIC, Federal Reserve
Impacts Certain Community Banks
Subtitle A—Transfer of Powers and Duties
—Supervision of savings and loan holding companies transferred to Federal Reserve
—Supervision of federal savings associations transferred to OCC
—Supervision of OTS functions related to state savings associations transferred to FDIC
Not Applicable To Community Banks
Subtitle B—Transitional Provisions (for property, funds and employees of OTS)
Applicable To Community Banks
Subtitle C—Federal Deposit Insurance Corporation—Deposit Insurance Reform
—Assessment base changed to assets less tangible capital (saves community banks $4.5 billion in the first
three years)
—Coverage limit permanently increased to $250,000
—Temporary unlimited coverage for non-interest bearing transaction accounts (expires year end 2012)
Not Applicable To Community Banks
—Minimum DIF reserve ratio increased to 1.35% by 2020 (increase from current 1.15% to 1.35% paid for
by banks over $10 billion)
2.
Subtitle D—Other Matters
Impacts Certain Community Banks
—Liberalizes branching rules for savings associations and savings associations that convert to banks.
May/MayNot Impact Community
Banks Depending on Implementation
—Office of Minority and Women Inclusion—each agency to establish this office responsible for diversity in
agency management, employment and business activities ; the office will also develop standards to assess the
diversity policies and practices of regulated entities but no specific action is required based on the assessment
Title IV—Regulation of Advisors to Hedge Funds and Others
Not Applicable To Community Banks
—Hedge funds and private equity funds must register with and report to SEC under Investment
Advisors Act
Applicable To Community Banks
—Revision of accredited investor standard for raising capital in a private offering
Title V—Insurance
Not Applicable To Community Banks
Subtitle A—Office of National Insurance
Subtitle B—State Based Insurance Reform
Part I—Nonadmitted Insurance
Part II—Reinsurance
Title VI—Improvements to Regulation of Bank and Savings Association Holding Companies and Depository Institutions
Not Applicable To Community Banks
—Moratorium on applications for commercial firm ownership of credit card banks and industrial loan
companies (effective for 3 years).
Applicable To Community Banks
—Fed authority to examine subsidiaries of BHCs and SLHCs
—Bank acquisitions:
Not Applicable To Community Banks
—Fed to consider financial stability of the U.S. when approving bank acquisitions;
—Fed approval required for FHC acquisition of non-bank assets over $10 billion;
3.
Applicable To Community Banks
—BHC must be well capitalized and well managed in order to make interstate bank acquisition;
—Resulting bank in interstate merger must be well-capitalized and well-managed.
—BHC capital:
—Fed shall make BHC and SLHC capital regulations countercyclical (required capital increases in
times of economic expansion and decreases in times of economic contraction).
—Source of strength: BHCs shall be source of strength for bank subs.
—Activities Restrictions:
—Transactions with affiliates: Enhanced 23A and 23B restrictions (includes credit exposure on
derivative transactions and securities borrowing and lending transactions)
—Transactions with insiders: restrictions expanded to include credit exposure on derivative
transactions, and limitations on asset purchases with insiders enhanced.
—De novo branching—de novo interstate branching permitted
—Charter conversions to/from state/federal—prohibited if enforcement action in place (with limited
exceptions)
—Lending limits—include credit exposures from derivatives, repurchase and reverse repurchase agreements,
and securities borrowing and lending transactions
May/MayNot Impact Community
Banks Depending on Implementation
—Volcker Rule:
—Proprietary trading by banking entities prohibited (with certain exceptions); ownership or
sponsorship of hedge or private equity fund prohibited (with limited exceptions)
Not Applicable To Community Banks
—Higher capital requirements for systemically risky non-bank financial companies that
engage in proprietary trading or have ownership stake in hedge or private equity fund
prohibited; quantitative limits on such activities
—Concentration limits on large financial firms—no acquisitions among banks, BHCs, and systemically risky
non-bank financial companies if total liabilities of resulting entity exceeds 10% of system-wide liabilities.
—Securities holding company supervision—may elect to be subject to Federal Reserve oversight
—Conflicts of interest for underwriters/sponsors of asset-backed securities
—Treatment of dividends by mutual holding companies
Impacts Certain Community Banks
Applicable To Community Banks
—Interest-bearing transaction accounts authorized—repeal of Reg Q prohibition on interest on business checking
4.
Title VII—Swaps and Derivatives Regulation (Wall Street Transparency and Accountability)
May/MayNot Impact Community
Banks Depending on Implementation
—Regulation of Over-the-Counter and Security-Based Swaps Markets relating to capital and margin
requirements.
Title VIII—Payment, Clearing and Settlement Supervision
Not Applicable To Community Banks
—Oversight, supervision and examination of systemically important financial market utilities and payment,
clearing or settlement activities
Title IX—Investor Protections and Improvements to the Regulation of Securities
Not Applicable To Community Banks
Subtitle A—Increasing Investor Protection
—Creates Investor Advisory Committee within SEC to advise on regulatory priorities, regulation of securities
products/fees/disclosures, investor protection initiatives
—Various studies on financial literacy, mutual fund advertising, investor access to information
broker-dealer standards of care, etc.
Subtitle B—Increasing Regulatory Enforcement and Remedies
—SEC authority to restrict mandatory arbitration between broker-dealers and clients
Impacts Certain Community Banks
—Whistleblower protections [SEC registered/filing community banks]
—Miscellaneous provisions including:
Not Applicable To Community Banks
—Short sale reforms
—SIPC amendments
Impacts Certain Community Banks
—Aiding and abetting liability
—SEC enforcement
Not Applicable To Community Banks
Subtitle C—Improvements to Regulation of Credit Rating Agencies
—Enhanced regulation of credit rating agencies, including internal controls, penalties for misconduct,
separation of rating from sales and marketing, conflicts of interest, disclosure of ratings performance,
methodologies, due diligence on asset-backed securities, corporate governance, private right of action
—Creation of Office of Credit Ratings within SEC to administer rules, conduct annual exams
5.
—Qualification standards for analysts
Applicable To Community Banks
—Removal of statutory and regulatory references to credit ratings
Subtitle D—Improvements to the Asset-Backed Securitization Process
May/MayNot Impact Community
Banks Depending on Implementation
—Credit risk retention requirements for securitizers; qualified residential mortgages
Not Applicable To Community Banks
—Disclosures and reporting for asset-backed securities
Impacts Certain Community Banks
Subtitle E—Accountability and Executive Compensation
—“Say on Pay” shareholder resolutions (public companies)
—Shareholder resolutions on golden parachutes (public companies)
—Compensation committee independence (public companies)
—Compensation disclosure in proxy statements (public companies)
—Compensation “clawbacks” (public companies)
—Financial institution compensation prohibitions (no unsafe and unsound compensation practices, or
excessive compensation, etc.). Banks under $1 billion are exempt.
—Hedging disclosure (public companies)
Not Applicable To Community Banks
Subtitle F—Improvements to the Management of the SEC
—Requires reports to Congress/studies on internal supervisory controls, personnel management, financial
controls audit, oversight of national securities associations, organization reform, employee revolving door, etc.
-Increased examination staffing
Impacts Certain Community Banks
Subtitle G—Strengthening Corporate Governance
—Proxy access for shareholder nomination of directors, including exemption authority (public companies)
—Chairman and CEO structure proxy disclosures (public companies)
Subtitle H—Municipal Securities
May/MayNot Impact Community
Banks Depending on Implementation
—Registration and oversight of municipal advisors
6.
Not Applicable To Community Banks
—Studies of municipal securities market and disclosures by municipal securities issuers
—Government Accounting Standards Board provisions (fees to support and study of role and funding)
Subtitle I—Public Company Accounting Oversight Board, Portfolio Margining, and Other Matters
—Foreign auditor oversight authority access to public accounting firm information
—Auditing requirements for broker-dealers
—Portfolio margining amendments
—Loan or borrowing of securities in contravention of SEC rules
—Bank regulator reports of material losses to DIF in bank failures
—GAO study of proprietary trading
—Misleading “senior investor” certification designations
—Provisions relating to agency inspectors general
—GAO study of person to person lending
Applicable To Community Banks
—Exemption from SOX 404(b) attestation requirements for small issuers
Not Applicable To Community Banks
Subtitle J—SEC Match Funding
Title X—Bureau of Consumer Financial Protection
Not Applicable To Community Banks
—Supervisory, examination and enforcement authority for banks over $10 billion
—Supervisory, examination and enforcement authority for non-bank providers
Applicable To Community Banks
—CFPB established to enforce consumer financial protection laws and write regulations covering consumer
financial products and services
—Banks $10 billion or less—supervisory, examination and enforcement authority remains with prudential
bank regulators
—Jurisdiction over 18 federal consumer financial protection laws
—Authority to prescribe rules to prevent unfair, deceptive or abusive practices
7.
Not Applicable To Community Banks
—Authority to take enforcement action to prevent unfair, deceptive or abusive practices
Applicable To Community Banks
—Authority to prescribe rules re: disclosures of features of consumer financial products and services; directed to
develop model combined Truth in Lending and RESPA mortgage disclosures
—Authority to exempt any class of providers, products or services from a rule, considering asset size, volume of
transactions and adequacy of existing protections
—FSOC may overturn CFBP final rule upon 2/3 vote if rule puts the safety and soundness of the banking
system or the stability of the financial system at risk.
—CFPB/SBA must convene panel in pre-rulemaking stage to consider impact on small businesses and less costly
alternatives
—No usury limit authority
—Enforcement of federal consumer protection laws by state attorneys general
—Preservation of state law; preemption standards for national banks and federal thrifts
—Regulation of consumer remittance services (disclosures, refund, error resolution, etc.)
—Small business loan data collection requirements
—Interchange fees and routing—authority for Federal Reserve Board to regulate debit interchange fees
(capped in relation to issuer costs) and prescribe rules re: exclusivity and routing, etc. Issuers of $10 billion
or less in assets exempt from fee cap rules.
Title XI—Federal Reserve System Provisions (Lending Authority, Reserve Bank Governance)
Applicable To Community Banks
—Provisions regarding Federal Reserve emergency lending authority to eliminate case-by-case assistance to
individual institutions; programs must have broad eligibility
—Authority for FDIC to create widely available emergency financial stabilization programs during time of
severe economic stress
—Class A Federal Reserve Bank directors (member banks) may no longer vote for FRB president
Not Applicable To Community Banks
—New position on Federal Reserve Board created: Vice Chairman for Supervision
—Various GAO and Federal Reserve reports and studies on FRB credit facilities, and FRB governance
8.
Title XII—Improving Access to Mainstream Financial Institutions
Applicable To Community Banks
—Treasury to establish programs of grants, cooperative agreements, etc to promote initiatives to enable low
and moderate income individuals to set up accounts at insured depositories and obtain small dollar loans
Title XIII—Pay It Back Act
Not Applicable To Community Banks
—Reduction of TARP authorization
—Withdrawal or recapture of unobligated funds under the American Recovery and Reinvestment Act of 2009
Title XIV—Mortgage Reform and Anti-Predatory Lending Act
Applicable To Community Banks
Subtitle A—Residential Mortgage Loan Origination Standards
—Mortgage originators must be qualified and, when required, registered and/or licensed per the
SAFE Act
—Anti-steering—compensation to mortgage originator cannot vary based on terms of the
mortgage (other than principal amount); no steering to mortgage borrower unlikely to repay, etc.
—CFPB may prohibit or restrict abusive, unfair, deceptive or predatory mortgage practices
Subtitle B—Minimum Standards for Mortgages
—“Ability to Repay”—Creditor must make good faith determination based on verified
documentation that borrower has reasonable ability to repay
—Safe harbor/rebuttable presumption that borrower has ability to repay for “qualified mortgages”
as defined by CFPB
—Limitation on prepayment penalties
—General prohibitions/restrictions on single premium credit insurance, mandatory arbitration,
negative amortization loans
Subtitle C—High Cost Mortgages
—Definition and restrictions
Not Applicable To Community Banks
Subtitle D—Office Housing Counseling
—Office established in HUD
9.
Applicable To Community Banks
Subtitle E—Mortgage Servicing
—Mandatory escrow for certain loans; exemption authorized for creditors in rural and underserved areas who
hold mortgages in portfolio.
—Disclosures required when borrower declines optional escrow
—Establishes conditions/protections related to forced-placed hazard insurance
—Requirements for prompt crediting of payments and prompt provision of payoff amounts
Subtitle F—Appraisal Activities
—Specifies required appraisals by certified/licensed appraiser
—Appraisal independence requirements; customary and reasonable fees
Not Applicable To Community Banks
—Appraiser licensing and education standards are strengthened
—Registration, licensing and supervision of appraisal management companies by FFIEC
Subtitle G—Mortgage Resolution and Modification
—Multifamily mortgage resolution program to protect tenants, etc
—Home Affordable Modification Program (HAMP) provisions (Treasury Dept)
Subtitle H—Miscellaneous Provisions
—Study of mortgage foreclosure rescue scams, study of Chinese drywall; authorization for Treasury
Emergency Homeowner’s Relief Fund, Treasury Neighborhood Stabilization Program, and grants for
foreclosure legal assistance for low/moderate income homeowners
Title XV—Miscellaneous Provisions
Not Applicable To Community Banks
—Restrictions on use of U.S. funds for foreign governments, Republic of Congo conflict minerals
provisions, coal mine safety, study on effectiveness of inspectors general, etc.
Applicable To Community Banks
—FDIC study on core deposits and brokered deposits
Title XVI—Section 1256 Contracts
Not Applicable To Community Banks
—Certain swaps not treated as Section 1256 contracts
*Community Banks $10 billion or less in assets for purposes in this document.
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