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Senate Banking Chair, Democrats Still Hopeful for Deal on Dodd-Frank Bank Rules Rewrite

ABI Bankruptcy Brief
ABI Bankruptcy Brief
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November 2, 2017

ABI Bankruptcy Brief

Senate Banking Chair, Democrats Still Hopeful for Deal on Dodd-Frank Bank Rules Rewrite

Senior U.S. Republican and Democratic Senators said yesterday that they would push ahead with efforts to reach a bipartisan deal on rolling back some financial rules introduced during the 2008 financial crisis, even after a leading Democratic lawmaker walked away from talks, Reuters reported. Sen. Sherrod Brown (D-Ohio) said yesterday that he was stepping away from months-long private negotiations with the Committee’s Republican chair, Senator Mike Crapo (D-Idaho), over rolling back elements of the 2010 Dodd-Frank law, saying they had reached an impasse. However, Sen. Crapo told reporters yesterday that he was still working toward a regulatory reform bill and would renew efforts to reach a bipartisan compromise. “I intend to move forward to build a bipartisan solution, and I hope to be able to do so soon,” he said. Spokespeople for Sens. Heidi Heitkamp (D-N.D.) and Joe Donnelly (D-Ind.) said that they were open to rekindling the talks. “Congress needs to make the financial regulatory system work better for everyone, and I’m willing to work with anyone on a deal that would accomplish that goal,” Sen. Heitkamp said. The House of Representatives has already passed a broad rewrite of Dodd-Frank legislation, but the Senate will ultimately determine what, if any, relief the Republican-led Congress hands to banks. Industry expectations on a final deal had been modest because Senate Republicans need eight Democrats to support their efforts in order to pass changes to Dodd-Frank. The exact shape of a regulatory reform bill is generally not made public.
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Analysis: Experts Indicate Oversaturation of Restaurants

After a prolonged stretch of explosive growth, fueled by interest from Wall Street, experts say there are now too many fast-food, fast-casual and other chain restaurants, the New York Times reported on Tuesday. Since the early 2000s, banks, private-equity firms and other financial institutions have poured billions into the restaurant industry as they sought out more tangible enterprises than dot-com start-ups, some of which have been going belly-up. There are now more than 620,000 eating and drinking places in the U.S., according to the Bureau of Labor Statistics, and the number of restaurants is growing at about twice the rate of the population.
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CFPB Report Finds Sharp Increase in Long-Term Auto Loans

The Consumer Financial Protection Bureau (CFPB) yesterday released a report on auto loan trends that found a sharp increase in riskier longer-term auto loans, according to a press release. The report said that 42 percent of auto loans made in the last year carried a payback term of six years or more, compared to just 26 percent in 2009. The growth of these longer-term loans has largely come at the expense of five-year loans, which declined over the same period. The CFPB found that six-year auto loans are riskier—they cost more, are used by consumers with lower credit scores to finance larger amounts, and have higher rates of default.
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Report: More Competitive U.S. Oil and Gas Lending Drives Down Pricing

A renewed willingness to lend to U.S. oil and gas companies, as oil prices stabilize well above lows, is driving down pricing for borrowers after two straight years of steep increases, Reuters reported. The volume of credit lines provided to exploration and production companies, using their oil and gas reserves as collateral, so far this year has already topped full-year 2016, although it is a shadow of the 2014-15 tallies reached before oil and gas prices tanked, according to Thomson Reuters LPC. “This industry has been very resilient through the cycle, and we remained committed to our clients throughout, providing them with unwavering support to help them succeed,” said Mike Lister, head of JP Morgan’s Corporate Client Banking Energy group. “There is more bank capital available today for oil & gas companies.” Lending to the upstream sector has reached $35 billion so far this year, surpassing the $29 billion lent in all of last year, LPC data show. However, this volume is starkly lower than the $112 billion in 2014 and $61 billion in 2015.
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Next Consumer Commission Open Meeting to Take Place Next Friday at ABI’s Hon. Eugene R. Wedoff Consumer Bankruptcy Conference in Chicago

ABI's Commission on Consumer Bankruptcy will hold a public meeting during the Hon. Eugene R. Wedoff Seventh Circuit Consumer Bankruptcy Conference on November 10, 2017, from 12:00-1:30 PM at Jenner & Block’s Conference Center in Chicago. To access the list of topics under consideration by the Commission’s committees and previous hearing statements, please click here.

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New on ABI’s Bankruptcy Blog Exchange: FDIC Survey Finds Community Bank Small Business Loans Are Undercounted

A recent FDIC survey suggests that call-report data on commercial and industrial loans does not fully capture small business lending by smaller institutions, according to a recent blog post.

To read more on this blog and all others on the ABI Blog Exchange, please click here.

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