Magazine article American Banker

Moynihan Urges Cautious Approach to GSE Reform

Magazine article American Banker

Moynihan Urges Cautious Approach to GSE Reform

Article excerpt

Byline: Donna Borak

WASHINGTON - Brian Moynihan, the chief executive officer of Bank of America Corp., sounded a note of caution Friday on everything from implementation of the Dodd-Frank Act to reform of the housing finance system, saying policymakers must guard against unintended consequences.

Speaking to the National Press Club, Moynihan said any reform could end up making homeownership more costly.

"All of us have thoughts about how we could have done this better in hindsight," he said. "But I would be careful; this is another case of 'Be careful for what you wish for.' ... Many of you might have a 30-year mortgage, [but] remember if we go to floating rate mortgages, it works, except your mortgage could be more costly to you. If we say it's fair for everybody to pay more cost to avoid this issue, then everybody's got to be willing to make that transition."

Moynihan said he viewed the issue as a "societal question."

"If we want to change it, we can change it, but we have to change it across the board, and that will be difficult for American consumers if some of the ideas that are thrown out here take hold," he said. "This could change dramatically the benefits we've all gotten from a very robust, very efficient, and very able-to-borrow long-term mortgage market."

Nearly three months after enactment of the Dodd-Frank Act, Moynihan voiced support for the regulatory reform law, but emphasized that implementation of the statute would be critical.

"There is much work ahead to get that right, but recent reforms, if properly implemented, should contribute to future stability of the financial system," he said. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.