Changes in federal regulations and the impact of the newly created Consumer Financial Protection Bureau on the local banking industry will be discussed for the next two days during the fifth edition of the “Minority Depository Training Seminar” co-sponsored by the Puerto Rico Bankers Association and the Federal Deposit Insurance Corporation.
The seminar’s educational program includes conferences discussing regulations during the “post Dodd-Frank Act era,” the changes and new requirements it brought for Puerto Rico’s financial institutions, and other compliance aspects that affect local banking and financial institutions.
One of the most relevant aspects the Dodd-Frank Act brought with it was the creation of the Consumer Financial Protection Bureau, which represented a significant change in the federal regulatory structure regarding consumer protection, not only for banking institutions but also for other non-banking organizations that provide services to consumers, said Carmen M. Pagán, chairwoman of the PRBA’s compliance committee.
“This edition of the seminar is very important since we will be discussing the regulatory framework for the local banking industry in what we call the ‘post 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act era’ and the new regulatory framework that this law established,” said Pagán, who is also vice president and director of the compliance department at FirstBank.
The Consumer Financial Protection Bureau supervises the publication and enforcement of consumers’ protection federal laws and regulations, with which banks, credit unions and other financial institutions must comply.
The new organization also has the mission to educate consumers on how to protect themselves against abusive practices, as well as to gather and analyze information to better understand consumers, financial services providers, and consumer financial markets.
“Previously, the FDIC, together with other regulatory agencies, regulated all the areas of the banking business. Now, the FDIC coexists with the CFPB as a regulatory organization, with the latter focused on promoting consumer protection regulations’ compliance,” said Pagán, noting the FDIC continues to manage and supervise all aspects related to the soundness and safety of banking institutions in Puerto Rico and the United States.
“The CFPB works to make sure consumers have all the information they need to make the financial decisions that better adjust to the needs and reality of life of their families,” said Pagán.
Topics respond to industry needs
Industry executives choose the topics to be discussed during the seminar to strengthen their knowledge regarding the federal regulatory framework as a result of the new regulations and requirements that came into effect in 2010, she said.
Some of these include: the main regulatory changes during 2011; mortgage lending in a Dodd-Frank world; top mortgage lending changes; latest compliance risks and issues in electronic banking; third-party relationships’ risk and compliance; compliance in general; and ompliance hot topics, among others.
FDIC personnel will host the workshops and will benefit PRBA’s member and non-member financial institutions. Puerto Rico’s banking industry comprises eight banks with a combined 435 branches, some 1,473 ATM terminals and 39,468 points of sale throughout the island. The sector generates about 17,500 jobs.
“This educational forum gives the FDIC an excellent opportunity to provide technical support and to educate Puerto Rico’s financial institutions and their banking executives with the latest developments in the regulatory framework in a direct and timely manner, facilitating the implementation of these laws to benefit the local economy and consumers,” said Scott Strockoz, compliance deputy for the FDIC’s New York Regional Office, who has actively participated in the annual seminar over the past five years.