Bill Overview
Title: Transparency in Lending Act of 2022
Description: This bill requires federal financial supervisory agencies to submit to the Federal Financial Institutions Examination Council specified information regarding an examination of a large financial institution. Specifically, the agency must report on the status of the examination and any findings.
Sponsors: Rep. Mfume, Kweisi [D-MD-7]
Target Audience
Population: People who use services of large financial institutions subject to examination
Estimated Size: 243000000
- Large financial institutions are defined, as a general rule, to be those with more than $10 billion in assets, though the exact threshold can vary depending on the regulatory body.
- There are several large financial institutions, both domestically and internationally, that operate within the United States' jurisdiction.
- These institutions serve a significant portion of the global population who rely on them for banking, lending, investments, and other financial services.
- The act focuses on the examination of these institutions to ensure transparency, suggesting that those who benefit from or are affected by these financial entities would experience an impact from improved oversight and transparency.
- Consumer behavior may shift across all global markets where these institutions do business, potentially affecting millions worldwide.
Reasoning
- The target population includes individuals who rely on financial services from large institutions, specifically those defined as having over $10 billion in assets.
- Those directly interacting through loans, mortgages, and investment products are more likely to anticipate changes due to enhanced transparency.
- The policy may have varying impacts: while individuals involved in high-stakes financial decisions experience significant changes, everyday users of banking services may see minimal direct effects.
- Consideration of varying perspectives is essential; not everyone will have the same level of interest or understanding of examination processes.
- Budget and longevity constraints ensure only the most crucial transparency elements are prioritized, affecting noticeable change only in the long term.
Simulated Interviews
Financial Analyst (New York, NY)
Age: 35 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- The policy might increase the efficiency and trust in large banks.
- However, as an analyst, I foresee a potential increase in workload due to enhanced transparency obligations.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Small Business Owner (Houston, TX)
Age: 45 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 20.0 years
Commonness: 8/20
Statement of Opinion:
- Greater transparency might help small business owners understand loan terms better.
- I hope this leads to fairer lending conditions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 8 | 5 |
Software Engineer (San Francisco, CA)
Age: 28 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- As a regular banking user, I don't expect noticeable differences in my everyday experience.
- I do value knowing there’s more transparency in the system.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Retired (Chicago, IL)
Age: 60 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 6/20
Statement of Opinion:
- Increased reporting can prevent mismanagement, which gives me peace of mind.
- I hope the policy includes insights into investment decisions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 7 |
Real Estate Agent (Miami, FL)
Age: 50 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 4/20
Statement of Opinion:
- Enhanced transparency could simplify the loan process for my clients.
- This change may cut down on paperwork delays.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 7 | 5 |
Teacher (Denver, CO)
Age: 38 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 12/20
Statement of Opinion:
- If it means better loan terms, great, but I don’t see immediate personal implications.
- Financial language needs simplification to affect people like me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Entrepreneur (Seattle, WA)
Age: 29 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 7/20
Statement of Opinion:
- Greater transparency could facilitate more equitable investment opportunities.
- I'm cautiously optimistic about the policy.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 7 | 6 |
Actor (Los Angeles, CA)
Age: 34 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 15/20
Statement of Opinion:
- It sounds like a good initiative, but I need clearer personal implications to appreciate its value.
- Trust in financial management is critical for me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Nurse (Boston, MA)
Age: 55 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 18/20
Statement of Opinion:
- I'm glad there's more transparency, but I doubt it affects my day-to-day life unless it touches lending rates.
- Security assurance is key for my financial peace.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 6 | 6 |
Policy Advisor (Washington, D.C.)
Age: 42 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 20.0 years
Commonness: 3/20
Statement of Opinion:
- This will place a spotlight on financial institutions, making it easier to track compliance.
- However, there might be resistance from those profiting from current opacity.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 9 | 7 |
| Year 10 | 9 | 7 |
| Year 20 | 8 | 7 |
Cost Estimates
Year 1: $150000000 (Low: $100000000, High: $200000000)
Year 2: $120000000 (Low: $80000000, High: $160000000)
Year 3: $125000000 (Low: $90000000, High: $170000000)
Year 5: $130000000 (Low: $100000000, High: $180000000)
Year 10: $140000000 (Low: $110000000, High: $190000000)
Year 100: $160000000 (Low: $130000000, High: $200000000)
Key Considerations
- The bill does not carry direct costs for financial consumers but does require resources from federal agencies.
- Potential long-term savings from improved regulatory oversight efficiency and prevention of financial instability.
- The scope of impact is primarily on regulatory bodies and financial institutions rather than the general public directly.