Game Change

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month in review Summer Meltdown This past month saw new capital rules, senators take action on two critical issues, and an entire major metropolis succumb to recessionary pressures. JULY 3 Fed Finalizes Bank Reforms, Adds Rules for Small Institutions The Federal Reserve Board announced it approved a final rule to implement the Basel III regulatory capital reforms and requirements called for by the Dodd-Frank Act. The approved rule includes a new minimum ratio of common equity tier 1 capital. Community banks will also have a longer transition period to adopt the new requirements. JULY 8 Underwater Loans Down by Half in First Quarter The amount of delinquent borrowers dropped by nearly half from Q1 2012 to Q1 2013, according to research from LPS. The good news is not confined to a particular area, even the beleaguered "sand states" saw a decrease in underwater loans, down by as much as 53 percent year-over-year. JULY 16 Senate Confirms Cordray in 66-34 Vote The U.S. Senate voted to confirm Richard Cordray as director of the Consumer 14 | The M Report Financial Protection Bureau (CFPB) in a vote in mid-July. President Obama installed Cordray as a recess appointment in 2012, a move that was met with criticism by opponents who said that the Senate was not actually in recess. JULY 17 Senators Introduce Bipartisan Bill Strengthen FHA Lawmakers met to discuss a bill that will strengthen underwriting, hold lenders more accountable, and strengthen the FHA's reverse mortgage program. The senators who sponsored the bill said the FHA saved nearly "3 million jobs and prevented catastrophic collapse in home values." JULY 18 Detroit Files for Bankruptcy Detroit, once the fourth-most-populous city, filed for bankruptcy in mid-July making it the largest municipal district to go bankrupt in the history of the United States. The city owes somewhere between $18 billion and $20 billion to the government. The city's largest creditors are the General Retirement System of the City of Detroit and the Police and Fire Retirement System of the City of Detroit among others.

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