The seal of the Federal Deposit Insurance Corporation at its headquarters in Washington. Bloomberg
The seal of the Federal Deposit Insurance Corporation at its headquarters in Washington. Bloomberg
The seal of the Federal Deposit Insurance Corporation at its headquarters in Washington. Bloomberg
The seal of the Federal Deposit Insurance Corporation at its headquarters in Washington. Bloomberg

Major bank regulation back in focus as top US official plans to step down


Kyle Fitzgerald
  • English
  • Arabic

A top US official's intent to resign has sparked renewed debate over the future of banking regulation, as questions linger over the fate of banking reforms.

After a blistering report outlining a culture of sexual harassment and mismanagement at the Federal Deposit Insurance Corporation, chairman Martin Gruenberg announced he would resign as soon as a successor is chosen.

The news comes at a perilous time for Democrats and bank regulators seeking to push through major reforms.

Chief among those changes is the proposed capital requirements for the largest banks, otherwise known as Basel III.

The FDIC is one of three regulators – along with the Federal Reserve and Office of the Comptroller of Currency – pushing for these new capital requirements.

The proposed rule's fate was already uncertain heading into this week, but Mr Gruenberg's looming resignation underscores Basel III's uncertain future.

What is Basel III and why is it controversial?

The Basel III Endgame was first introduced in 2010, two years after the global financial crisis. But even before the collapse of Lehman Brothers, there were already cracks in the banking sector including low liquidity buffers and poor risk management.

Many reforms were made in the following decade, but the US regional banking crisis last year brought renewed focus on Basel III, and the three US regulators released a proposal that would significantly increase banks' risk-weighted assets, which increases the capital banks would need to meet minimal capital and buffer requirements.

Doing so would make the US banking system more resilient to shocks, and US regulators proposed much stronger capital requirements than those in the EU.

The collapse of Silicon Valley Bank in 2023 brought renewed focus on banking regulation in the US. Reuters
The collapse of Silicon Valley Bank in 2023 brought renewed focus on banking regulation in the US. Reuters

Under the US rules, globally important banks would need to increase their capital requirements by a range of 16 per cent to 20 per cent, while regional banks would see a 10 per cent increase.

The proposal faces significant opposition – not only from private bankers, but from Democrats, Republicans and state officials.

A vast majority of notes received during the comment period opposed the plan.

Many comments said the proposed rule would mean reduced access to credit for small businesses, homebuyers and minority communities. Others said it would harm energy projects and capital markets.

“The record of comments on the proposal includes a substantial amount of detailed and significant comments from a diverse range of industries – almost all of which express reservations about at least some aspects of the proposal,” Latham and Watkins said in a February report.

During a House of Representatives hearing in December, chief executives of eight major banks criticised the proposed rules.

“Real changes need to be made to address this over-calibration, or we risk a serious impact on financial institutions’ ability to raise and lend money for companies as well as assume risk on behalf of pension funds, mutual funds and other investors,” Goldman Sachs chief executive David Solomon said in his testimony.

Chief executives of eight major US banks testify before Congress on December 6, 2023. Reuters
Chief executives of eight major US banks testify before Congress on December 6, 2023. Reuters

That pushback is leading regulators to significantly lessen the increase for large banks, The Wall Street Journal reported.

The US, EU and UK are set to the implement the new rules next year.

Why does the FDIC chairman's replacement matter?

By staying on as FDIC chairman until a successor is chosen, Mr Gruenberg spares Democrats from having to contend with stalled banking reform.

Had he immediately stepped down, a Republican would have become acting head of the agency and the FDIC's board would be split evenly between the two parties.

Speaking from the Senate floor on Tuesday, Republican leader Mitch McConnell suggested Democrats were not calling for Mr Gruenberg's removal because of the political calculus.

“Surely their reluctance has nothing to do with the FDIC’s line of succession, which would fill a vacancy with the agency’s distinguished vice chair, who happens to be a Republican,” Mr McConnell said.

There is currently no timetable to replace Mr Gruenberg, though the White House has said it would soon nominate his successor.

COMPANY%20PROFILE
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While you're here
UAE currency: the story behind the money in your pockets
Wednesday's results

Finland 3-0 Armenia
Faroes Islands 1-0 Malta
Sweden 1-1 Spain
Gibraltar 2-3 Georgia
Romania 1-1 Norway
Greece 2-1 Bosnia and Herzegovina
Liechtenstein 0-5 Italy
Switzerland 2-0 Rep of Ireland
Israel 3-1 Latvia

THE CLOWN OF GAZA

Director: Abdulrahman Sabbah 

Starring: Alaa Meqdad

Rating: 4/5

Five famous companies founded by teens

There are numerous success stories of teen businesses that were created in college dorm rooms and other modest circumstances. Below are some of the most recognisable names in the industry:

  1. Facebook: Mark Zuckerberg and his friends started Facebook when he was a 19-year-old Harvard undergraduate. 
  2. Dell: When Michael Dell was an undergraduate student at Texas University in 1984, he started upgrading computers for profit. He starting working full-time on his business when he was 19. Eventually, his company became the Dell Computer Corporation and then Dell Inc. 
  3. Subway: Fred DeLuca opened the first Subway restaurant when he was 17. In 1965, Mr DeLuca needed extra money for college, so he decided to open his own business. Peter Buck, a family friend, lent him $1,000 and together, they opened Pete’s Super Submarines. A few years later, the company was rebranded and called Subway. 
  4. Mashable: In 2005, Pete Cashmore created Mashable in Scotland when he was a teenager. The site was then a technology blog. Over the next few decades, Mr Cashmore has turned Mashable into a global media company.
  5. Oculus VR: Palmer Luckey founded Oculus VR in June 2012, when he was 19. In August that year, Oculus launched its Kickstarter campaign and raised more than $1 million in three days. Facebook bought Oculus for $2 billion two years later.
The biog

Name: Abeer Al Shahi

Emirate: Sharjah – Khor Fakkan

Education: Master’s degree in special education, preparing for a PhD in philosophy.

Favourite activities: Bungee jumping

Favourite quote: “My people and I will not settle for anything less than first place” – Sheikh Mohammed bin Rashid.

Five expert hiking tips
    Always check the weather forecast before setting off Make sure you have plenty of water Set off early to avoid sudden weather changes in the afternoon Wear appropriate clothing and footwear Take your litter home with you
Ms Yang's top tips for parents new to the UAE
  1. Join parent networks
  2. Look beyond school fees
  3. Keep an open mind
Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
Dengue%20fever%20symptoms
%3Cp%3EHigh%20fever%20(40%C2%B0C%2F104%C2%B0F)%3Cbr%3ESevere%20headache%3Cbr%3EPain%20behind%20the%20eyes%3Cbr%3EMuscle%20and%20joint%20pains%3Cbr%3ENausea%3Cbr%3EVomiting%3Cbr%3ESwollen%20glands%3Cbr%3ERash%26nbsp%3B%3C%2Fp%3E%0A
A State of Passion

Directors: Carol Mansour and Muna Khalidi

Stars: Dr Ghassan Abu-Sittah

Rating: 4/5

MATCH INFO

New Zealand 176-8 (20 ovs)

England 155 (19.5 ovs)

New Zealand win by 21 runs

How to apply for a drone permit
  • Individuals must register on UAE Drone app or website using their UAE Pass
  • Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
  • Upload the training certificate from a centre accredited by the GCAA
  • Submit their request
What are the regulations?
  • Fly it within visual line of sight
  • Never over populated areas
  • Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
  • Users must avoid flying over restricted areas listed on the UAE Drone app
  • Only fly the drone during the day, and never at night
  • Should have a live feed of the drone flight
  • Drones must weigh 5 kg or less
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%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%204-cylinder%202-litre%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E9-speed%20automatic%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E252%20brake%20horsepower%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E352Nm%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3Efrom%20Dh146%2C700%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3Enow%3C%2Fp%3E%0A
Conflict, drought, famine

Estimates of the number of deaths caused by the famine range from 400,000 to 1 million, according to a document prepared for the UK House of Lords in 2024.
It has been claimed that the policies of the Ethiopian government, which took control after deposing Emperor Haile Selassie in a military-led revolution in 1974, contributed to the scale of the famine.
Dr Miriam Bradley, senior lecturer in humanitarian studies at the University of Manchester, has argued that, by the early 1980s, “several government policies combined to cause, rather than prevent, a famine which lasted from 1983 to 1985. Mengistu’s government imposed Stalinist-model agricultural policies involving forced collectivisation and villagisation [relocation of communities into planned villages].
The West became aware of the catastrophe through a series of BBC News reports by journalist Michael Buerk in October 1984 describing a “biblical famine” and containing graphic images of thousands of people, including children, facing starvation.

Band Aid

Bob Geldof, singer with the Irish rock group The Boomtown Rats, formed Band Aid in response to the horrific images shown in the news broadcasts.
With Midge Ure of the band Ultravox, he wrote the hit charity single Do They Know it’s Christmas in December 1984, featuring a string of high-profile musicians.
Following the single’s success, the idea to stage a rock concert evolved.
Live Aid was a series of simultaneous concerts that took place at Wembley Stadium in London, John F Kennedy Stadium in Philadelphia, the US, and at various other venues across the world.
The combined event was broadcast to an estimated worldwide audience of 1.5 billion.

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Ruwais timeline

1971 Abu Dhabi National Oil Company established

1980 Ruwais Housing Complex built, located 10 kilometres away from industrial plants

1982 120,000 bpd capacity Ruwais refinery complex officially inaugurated by the founder of the UAE Sheikh Zayed

1984 Second phase of Ruwais Housing Complex built. Today the 7,000-unit complex houses some 24,000 people.  

1985 The refinery is expanded with the commissioning of a 27,000 b/d hydro cracker complex

2009 Plans announced to build $1.2 billion fertilizer plant in Ruwais, producing urea

2010 Adnoc awards $10bn contracts for expansion of Ruwais refinery, to double capacity from 415,000 bpd

2014 Ruwais 261-outlet shopping mall opens

2014 Production starts at newly expanded Ruwais refinery, providing jet fuel and diesel and allowing the UAE to be self-sufficient for petrol supplies

2014 Etihad Rail begins transportation of sulphur from Shah and Habshan to Ruwais for export

2017 Aldar Academies to operate Adnoc’s schools including in Ruwais from September. Eight schools operate in total within the housing complex.

2018 Adnoc announces plans to invest $3.1 billion on upgrading its Ruwais refinery 

2018 NMC Healthcare selected to manage operations of Ruwais Hospital

2018 Adnoc announces new downstream strategy at event in Abu Dhabi on May 13

Source: The National

COMPANY PROFILE

Company: Bidzi

● Started: 2024

● Founders: Akshay Dosaj and Asif Rashid

● Based: Dubai, UAE

● Industry: M&A

● Funding size: Bootstrapped

● No of employees: Nine

COMPANY%20PROFILE
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While you're here
UAE currency: the story behind the money in your pockets

Hotel Silence
Auður Ava Ólafsdóttir
Pushkin Press

The%20specs%3A%202024%20Mercedes%20E200
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COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%203S%20Money%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202018%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20London%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Ivan%20Zhiznevsky%2C%20Eugene%20Dugaev%20and%20Andrei%20Dikouchine%3Cbr%3E%3Cstrong%3ESector%3A%3C%2Fstrong%3E%20FinTech%3Cbr%3E%3Cstrong%3EInvestment%20stage%3A%3C%2Fstrong%3E%20%245.6%20million%20raised%20in%20total%3C%2Fp%3E%0A
The White Lotus: Season three

Creator: Mike White

Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell

Rating: 4.5/5

Updated: May 22, 2024, 3:00 PM`