1 / 32

The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry

The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry. Steven Pruitt, Managing Partner, Consultant to the National Installment Lenders Association (NILA). The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry. AGENDA.

Download Presentation

The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Steven Pruitt, Managing Partner, Consultant to the National Installment Lenders Association (NILA)

  2. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry AGENDA • Overview of the 2014 Congressional Session • The Washington Regulatory Environment • 2014 Congressional Elections • Outlook for 2015: What to Expect next year? • The Future of the Dodd-Frank Act • What Can You Do??

  3. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Overview of the 2014 Congressional Session • Days in Session • Legislative Activities • The Congressional Leadership Story • The President’s Financial Services Legislative Agenda

  4. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Days in Session/Congressional Productivity

  5. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Legislative Activities • House vs. Senate • 13,437 bills introduced to date in the 113th Congress • House voted on 1,012 bills: Senate votes on 172 • President has signed 125 bills into law

  6. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Legislative Activities • Legislating and Oversight vs. Media Circus • Benghazi • Libya • IRS Targeting • General Motors Ignition Switch Recall • EPA and Environmental Issues • CFPB • Keystone Pipeline • The War on Coal • VA Scandal

  7. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story • Republican Civil War • Unexpected Changes to House • Leadership Team • Lack of Legislative Agendas? • Ability to Lead? • House-Senate Relations

  8. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story The Republican Civil War VS

  9. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story • Unexpected Changes to House • Leadership Team • Eric Cantor (VA) loses • Primary election to Tea • Party Candidate • Kevin McCarthy (CA) • elected Majority Leader • Steve Scalise (LA) elected • Majority Whip

  10. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story • Lack of Legislative Agendas • President signaled intent to use Executive Powers to • govern; has not presented a real agenda but jumped • from one issue/crisis to another • Congressional Republicans nor Democrats actually have • a governing agenda that is pro-active • Republicans focused on restraining government • intervention; but have not defined intervention or • restraint • Democrats powerless to act: can’t muster 60 votes in • Senate, don’t control legislative action in the House

  11. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story • Questions about the Ability to Lead • Speaker Boehner has not shown an ability to get his • Party members to take BIG votes; Tea Party having major • impact, only BIG bills that have passed (Agriculture, • Water Resources) passed with Democratic votes • Republican Leadership Team (Boehner, Cantor, • McCarthy) are rarely on the same page legislatively • Democratic Leadership Adrift; major questions about • direction and succession in 2014/2016; lack tools to • enforce Party discipline

  12. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Congressional Leadership Story • House-Senate Relations • Very little consultation/communication between the two bodies • Different forces driving each body and Party’s political • outlook (ideological and generational) • Rules changes have made it difficult to coordinate • actions by both bodies • 2014 Elections impacting policy discussions-both bodies relying mostly on “messaging votes” • 2016 Presidential politics interfering with Leadership’s • ability to find common ground • Potential of Leadership changes in both Parties and • bodies has created a “Lame Duck” environment

  13. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The President’s Financial Services Agenda • Announced Agenda • Fight all efforts to repeal or weaken Dodd-Frank • Fully fund/increase funding for all Regulatory Agencies • Reform GSEs-Fannie Mae and Freddie Mac • Move forward with implementation of regulatory • responsibility realignment • Continue rollout of new Rules and Regulations • required by Dodd-Frank

  14. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The President’s Financial Services Agenda • Added Agenda Items • Initiate/accelerate Examinations authorized by Dodd- • Frank • Accelerate rule-making and regulations rollout • Begin enforcement activities • Expand scope of data gathering activities to enhance • regulatory reach • Increase promotion of regulatory activities-send a • tough message

  15. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Washington Regulatory Environment

  16. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Washington Regulatory Environment

  17. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Washington Regulatory Environment • The Expanding Federal Consumer Lending Regulatory Agenda • Truth in Lending • Small-Dollar, Short-Term Lending (Pay Day, Lease-to-Own, Auto Title) • Online Lending • Ability-to-Pay • Disparate Impact • Fair Credit Reporting (Regulation V) • Debt Collection Practices (Regulation F) • Arbitration and Dispute Resolution • Ancillary Products • Financial Education (Literacy) • Disclosure Requirements and Practices • Customer Complaints (Process, Data Collection) • Enforcement • Operation Choke Point • Reforms to Military Lending

  18. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Washington Regulatory Environment • Growing Number of Federal Consumer Lending Regulatory Tools • Rulemaking • Studies (Data Collection), Requests for Comment and White Papers • Company Office Visits, Employee Audits and Interviews • Field Hearings • Consumer Complaint Hotline and Web Portal • Social Media-Crowd Sourcing, Facebook and Twitter Feeds • Agency procedural manuals • Changes in Supervisory Authority • Alliances with State Attorneys General

  19. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry 2014 Congressional Elections • House of Representatives is not really in play • All 435 seats being contested • Democrats would have to win 7 seats “net” to regain • control • Only 18 races will define the outcome over control of • the House

  20. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry 2014 Congressional Elections • The Senate is the Real Battle Ground • 33 Senate Seats and 3 vacancies • being contested • The current split: 21-D/15 R • Races in 13 States define the battle ground: • Louisiana Kentucky Virginia • Arkansas Georgia • North Carolina Michigan • Alaska New Hampshire • Iowa Minnesota • Colorado Oregon

  21. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry 2014 Congressional Elections

  22. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Look Ahead at the 2015 Congress • The Bad News • Republican Control doesn’t • necessarily mean “Pro-Business” or • “Pro-Industry Policies • Hensarling has not been particularly • friendly to small dollar, consumer • lenders • The Good News • House of Representatives expected to remain under Republican Control • Rep. Jeb Hensarling (R-TX) will remain as Chair of House Financial Services Committee-unless he runs for Majority Leader’s job

  23. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Look Ahead at the 2015 Congress • The Bad News • Shelby has generally been “Pro- • Business” and “Pro-Industry”; need • to be concerned about Committee • composition following 2014 • elections • Brown has not been friendly to • small dollar, consumer lenders; but • will have difficult time moving • Committee to the Left, • compromising with Republicans • The Good News • Change in Senate control and • Chairmanship of Senate • Banking Committee • Chairmanship (Richard • Shelby, R-AL) will be the • biggest change for the • Industry • If Democrats maintain control of the Senate, Sherrod Brown (D-OH) will become Chair of Senate Banking

  24. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Future of the Dodd-Frank Act • General belief is Dodd-Frank broadly got things directionally right, however, there are lots of places in Dodd-Frank where Congress got it wrong • Historically, with any major piece of federal legislation, Congress never gets it entirely right the first time • Many Groups pushing for Banking/Financial Services Committees to revisit Dodd-Frank in a rational way • Push today is for when Congress revisits Dodd-Frank, more work must be done on: • Transparency • Derivatives • The Volcker Rule • Refinement of the Financial Stability Oversight Council (FSOC) • Enhancement of the Office of Financial Research (OFR) • Review of efforts to designate financial firms as systemically important

  25. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry The Future of the Dodd-Frank Act • A Dodd-Frank “technical corrections bill” creates/provides an opportunity to work for targeted changes to the original law • Consumer Lending Industry well positioned to request/advocate for limited changes to the way Regulatory agencies treat Non-bank, consumer lenders • Potential changes needed by consumer lenders include: • Obtaining a clear definition of Installment Lending • Rebalancing State regulatory roles • Realignment of complaint processing and investigations

  26. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? • Write Letters/Emails • “Adopt a Congressman” • Develop ‘Relationship • Charts’ • Begin Pro-Active • outreach to and • education of local • media • Expand data collection • activities-Know your • customers and why • they are borrowing Stop Bitchin’ Behind the Barn

  27. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? Customer Service Accounting Legal Technology Recordkeeping & Privacy Controls Upgrade Your Financial Services ComplianceActivities

  28. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? Invest in more training for your workforce

  29. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? Recruit/Invest/Re-Assess Political Allies

  30. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? • Refocus Federal political giving on getting 2016 results • Texas Congressional delegation relations should become a • higher priority for the State Association-don’t assume how • they will act and vote in the Post Dodd-Frank era; • Neugebauer should be more of an advocate, Al Green can • become a friend • Enhance Company/Industry planning for business expansion • Industry needs a strategic growth plan • Understand that the consumer lending industry no longer • viewed as “Small Business”- industry impact now measured in • billions, not millions • Get into the 21st Century: grow your use and presence on • Social media

  31. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry What Can You Do?? • Prepare for an early 2015 DC Fly-In • Develop a plan for regular visits to Texas Congressional • delegation District Offices • Host Store tours for your local Congressmen and his/her • local staff • Begin working on obtaining Local “Resolutions of Support” • for consumer lending • Expand engagement with local organizations around • Financial Literacy activities

  32. The Pulse of Congress and Washington: The Impact on the Consumer Lending Industry Thank You !! Corporate Information Watts Partners 300 New Jersey Ave, NW Suite 650 Washington, DC 20001 PHONE (202) 207-2854 FAX (202) 207-2853 www.jcwatts.com

More Related