Regulating Interest Rates in a Digital World – Finance and Banking

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United States: Regulate interest rates in a digital world

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Maria Earley spoke to Reuters on the “valid when made” rules of the Federal Deposit Insurance Corporation (FDIC) and the Treasury Department Office of the Comptroller of the Currency (OCC), which state that when a bank lends at a valid interest rate, the interest rate applies remains when the loan is granted sold to a non-bank.

According to Maria, the industry sees the rules as essential to the banks’ ability to sell and securitize loans.

“You have to have secondary markets to keep the flow of credit,” said Maria. “Overriding ‘valid if done’ would seriously upset that.”

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