Bank-Friendly U.S. Regulator Shifts to Revamp Reputation

From Bloomberg
By Jesse Hamilton
October 4, 2012

In a stately hearing room stuffed with senators and bankers, Thomas Curry began his apologies. His agency should have stopped a major bank from helping drug cartels launder cash. The violations went on for years while his agency was overly passive.

“I deeply regret we did not act sooner,” he said…

‘Tougher’ Climate

Arthur Wilmarth, a law professor specializing in banking and financial regulation at George Washington University in Washington, predicts a “tougher supervisory climate toward the largest banks” and said the industry would push back.

“They’re not used to having the OCC take an independent view toward them,” he said in an interview. The OCC’s “change in tone” includes Curry’s willingness, unlike some of his predecessors, to admit mistakes, Willmarth said.

Bair said the agency’s independence problems stem from structural factors, including its industry funding. Until Congress responds to the “steady drumbeat of criticism” of the OCC, Bair said she hopes Curry makes headway on his own.

“We all should wish him well,” she said.

Cornelius Hurley, director of Boston University’s Morin Center for Banking and Financial Law, described Curry as “independent, low key and thoughtful” and said he’ll know when to push against Treasury Secretary Timothy F. Geithner.

“Look for Tom Curry to be the Sheila Bair of the next phase of the country’s banking crisis,” Hurley said.

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