Ian McKendry

A bipartisan Senate alliance working on a bank regulatory relief bill appeared even stronger Tuesday as it worked to minimize changes in the interest of moving the legislative package to the Senate floor.

The ill will between Democrats and Republicans in the controversy over appointing an acting Consumer Financial Protection Bureau chief adds a new wrinkle to bipartisan efforts to pass regulatory relief.

The financial services industry has cheered a proposed reduction in the corporate tax rate, but a lower rate could force Fannie Mae and Freddie Mac to write down assets, increasing the odds that the companies will need Treasury support.

District Judge Timothy J. Kelly ruled Tuesday that Office of Management and Budget Director Mick Mulvaney was the legal interim head of the Consumer Financial Protection Bureau, denying a request by Deputy Director Leandra English to block the appointment.

Employees at the Consumer Financial Protection Bureau are privately questioning why outgoing director Richard Cordray abruptly tapped a 34-year-old chief of staff with no enforcement, supervisory or legal experience to head the embattled agency after he resigned.

OMB Director Mick Mulvaney said he would "fix" the CFPB by ensuring it protected consumers without cutting off access to financial services. His comments came as a federal judge declined to rule yet on the legality of Mulvaney's appointment.

President Trump has tapped Office of Management and Budget Director Mick Mulvaney as interim head of the CFPB. He has taken tough stances on the CFPB, its payday lending rule, housing finance reform and other issues pending before the agency.

The Trump administration insisted Saturday that OMB Director Mick Mulvaney was the rightful interim leader of the CFPB, but Democrats said that the appointment was illegal. It remains unclear who is legally in charge.

CFPB Director Richard Cordray abruptly announced Friday that he would leave at the end of the day, giving the reins of the agency to a new deputy director.

The agency's Quarterly Banking Profile said banks earned $47.9 billion in the third quarter, helped by a 7.4% increase in net interest income from the previous year.

The White House and congressional GOP leaders are eyeing a tight window between tax reform passage and the 2018 midterms to pass housing finance reform. And with key policymakers readying their exit, the effort could be the most concerted push yet.

The resignation of CFPB Director Richard Cordray gives President Trump the chance to name a director who could roll back agency rules and supervisory policies.

The announcement by the head of the Consumer Financial Protection Bureau ends months of speculation about how long he planned to stay at the agency.

The regulatory relief bill would raise the SIFI threshold to $250 billion of assets and allow mortgages held in portfolio to be counted as "qualified," among other items, but it is far less sweeping than institutions had hoped.

The Senate tax proposal released Thursday would cap the mortgage interest deduction for properties worth $1 million, a reversal from the House plan that would have limited the deduction to $500,000.

Hopes that tax reform might soften a weakening of the mortgage interest deduction were quickly dashed as the GOP plan landed a double punch on the incentive cherished by the mortgage and housing industries.

Call-report data on commercial and industrial loans does not fully capture small-business lending by smaller institutions, a recent FDIC survey suggests.

In a somewhat surprising decision, House Financial Services Committee Chairman Jeb Hensarling announced his retirement from Congress on Tuesday, but speculation immediately grew that he could fill a regulatory post.

CFPB Director Richard Cordray sent a letter to President Trump Monday asking him to veto a Republican resolution to nullify the bureau's arbitration rule.

Republicans were able to use an obscure legislative process to overturn a rule that banks and credit unions feared would raise their litigation costs.