WASHINGTON (AP) - A regulator whose agency would disappear under a Bush
administration plan to revamp financial oversight says his agency should instead
be given expanded power over the U.S. home loan market.
John Reich, director of the federal Office of Thrift Supervision, said
Tuesday that his agency should be given broad powers over mortgage bankers and
brokers, many of whom operate outside federal regulation.
"There needs to be a federal supervisor of the entire mortgage industry,"
Reich said at a briefing with reporters.
The agency, which oversees 831 savings and loans, regulates major lenders,
including Seattle-based Washington Mutual Inc. and Sovereign Bancorp Inc. of
Philadelphia.
Under the administration's more than 200-page plan to overhaul financial
regulation, the Office of Thrift Supervision would be closed and its role would
be absorbed by the Office of the Comptroller of the Currency, which regulates
banks. Treasury Secretary Henry Paulson released the so-called regulatory
blueprint in March.
Reich called that idea, "counterintuitive and contrary to how we ought to be
responding to the current housing market correction."
While the Paulson plan asks Congress to establish a federal commission to
set recommended minimum licensing standards for mortgage brokers, Reich said his
agency would be better equipped to do so, as it has expertise with lending and
staff around the country.
"It would be easier for us to increase our resources in a short period of
time," he said.
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