The Federal Financial Forum

From: Computerworld

By Dan Morris

The recent system outages in banking systems point to an underlying and growing issue within banks. The impact of some of these outages has been so severe that it has led some to describe retail banks as IT companies with banking licenses.  While this is an extreme view, the failures do highlight that the technology infrastructure at the core of banking operations is in a poor state — another item to add to the list of regulator concerns.

Complexity creates systemic risk

From: Pmynts.com

Financial institutions participating in the 2012 Debit Issuer Study, commissioned by PULSE, experienced strong growth in debit transaction volume in 2011 amid profound regulatory changes.

“The latest Debit Issuer Study provides more evidence that growth in debit remains robust even in the face of significant regulatory headwinds,” said Steve Sievert, Executive Vice President of Marketing and Communications for PULSE.

The Federal Reserve’s Regulation II capped the maximum interchange fees that financial institutions with at least $10 billion in worldwide assets could receive on debit card transactions. These issuers report fundamental shifts in their debit business. The relative importance of PIN debit versus signature debit and interest in debit rewards were impacted by the regulation. Eighty-nine percent of large issuers indicate that regulatory pressure will be a key challenge in the coming year.

From: WSJ

By VICTORIA MCGRANE and ALAN ZIBEL

WASHINGTON—A U.S. bank regulator said Monday that its top lawyer will step down next month after nearly two decades of service, a departure that may signal tougher treatment ahead for banks.

Julie Williams, the chief counsel at the Office of the Comptroller of the Currency, said she will relinquish her position Sept. 30 and retire from the federal government at year-end. She joined the agency in 1993 and was named chief counsel the following year.

From: Association of Corporate Counsel

Jeff Werthan/Katten Muchin Rosenman LLP