Proposed Dodd-Frank change centers on Milstein
New York City real estate tycoon Howard Milstein has landed in the center of another debate surrounding the controversial Dodd-Frank Act that intends to change the banking industry in the wake of the recent crisis. The New York Daily News reported that local politicians are rallying to change an aspect of the law so that Millstein’s Emigrant Savings Bank, a large lender for local mortgages, isn’t forced to make a $300 million payout as a result of Dodd-Frank requirements.
The issue at hand stems from a specific requirement in the law for banks with more than $15 billion in assets that Emigrant did not meet. Though Emigrant surpassed that threshold, it did so only briefly when it took a loan in 2009 to help it weather the financial storm, according to the Wall Street Journal. New York politicians want federal regulators to add a specific date to the requirement that would exclude Emigrant. They argue that the smaller institution was never meant to be caught up in a law aimed at larger banks.
The Daily News said it’s no surprise that local officials are coming to Milstein’s defense considering his well-publicized and generous campaign contributions. [NYDN] and [WSJ]