the public. we strengthened collaborative relationships with other federal and state regulators and international counterparts. we engaged in substantial participation in scores of interagency and working group meetings and round tables, meeting with interested groups and individuals including investors, academics and industry participants and considering thousands of public comments. all of these efforts in addition to congressional input and robust commission debate are helping us to write rules that protect investors and the financial system without imposing undue burdens on market participants. some feel we are moving too quickly and others feel we are not moving rapidly enough i believe we are proceeding at a pace that ensures we will get the rules right. misstatement of the tapes -- my statement illustrates what has engage the sec for the past year

from hedge fund registration to the obligations of broker-dealers, implementation of a new whistleblower program. other priorities include completing the specialize disclosure rules called for in the act and establish a new oversight regime for the over-the-counter derivatives market, strengthening oversight of credit rating agencies, increasing oversight of financial market utilities, putting in place new oversight for municipal advisers beleaguered little -- engaging our foreign counterparts in discussions aimed at limiting the arbitrage and making effective use of enhanced enforcement powers to address wrong doing. the sec has shown tremendous progress in the past year the provisions of the dodd-frank act expand the sec's responsibilities and require significant additional resources to fully implement the law.

to date we have preceded the first stages of implementation without additional funding with other responsibilities and working on areas like information technology. it is incumbent to use our existing resources efficiently the new responsibilities are so significant they cannot be achieved solely by rating efficiencies out of the budget. attempting to do so will hamper our ability to meet the new and existing responsibilities. if the sec does not receive additional resources circumstances that contributed to the financial crisis will not be adequately addressed and the sec will not build out the technology or higher the expertise needed to oversee new areas of responsibility. i would note the dodd-frank act requires the fcc to collect transaction fees for annual appropriation of the agency. regardless of the amount appropriated to the sec because it will be offset it will have

no impact on the nation's budget. the sec implementing the dodd-frank act has been extensive. thank you for inviting me to share our progress and our plans going forward and i look forward to entering your questions. >> thank you, chairman of the -- schapiro. chairman gensler. >> thank you for inviting me to testify today and i am pleased to testify on behalf of the commodity futures trading commission. on this anniversary it is important to remember why derivatives reform was so necessary. when a ig and lehman brothers failed we paid the price. all of your constituents paid the price. the effects of the crisis continued to be very real with significant uncertainty in the economy and millions of americans still out of work. though the crisis had many causes it is clear the

derivatives played a central role. swaps added leverage to the financial system with more risk backed by less capital. they contributed particularly through credit default swaps to a bubble in the housing market and helped accelerate as we went into the crisis and contributed to a system where a large financial institutions once thought too big to fail all of a sudden were too interconnected to fail. the swaps which are so important helping manage and lower risks for thousands of end users in this economy in that moment of crisis concentrated in a heightened risk in the financial system and not to the public. what did dodd-frank do to address this? it broadened the scope of the oversight for the first time covering swaps. second the act promotes market

trend guarantees, something working on the security and futures markets through real-time reporting of transactions and bringing those transactions to a centralized space. economists for decades found a transparency reduces costs to users of the market. third the act lowered risk to the public and the overall economy by regulating the dealers and moving that which we can to a central clearing. fourth the act provides new enforcement authorities and reporting requirements for the regulators themselves to better police the market for manipulation and other abuses. the commission finalized a rule on manipulation similar to what the sec has had for decades and we think it will help. ranking member and ranking member frank had a discussion of

speculation. congress mandated aggregate position limits for physical commodities expanding the scope of certain swaps and linked contract. the cftc is working with the sec to deliberately and efficiently and transparently to write rules and implement these and other provisions of the act. this spring we completed the proposal phase of rulemaking and provided the public an extra 30 days to look at the will mosaic and staff and commissioners turned towards final rules approving eight so far. we anticipate taking of rules with regard to swap data repository, clearing position limits and others and moving forward and continuing to finalize rules. as we finalize rules we are reaching out to market participants. including round table and public comments to consider how to

implement this talking to international regulators and we are working closely at phased implementation which helped lower cost and risk. before i close i would like to make note the cftc is taking on significant expanded scope, kmart seven times the size of what we currently oversee. the commission must be adequately resources to police this market and affect the public without sufficient funds there will be fewer cops but we won't have enough to answer the basic questions from market participants and the public on this new rule. in conclusion we are working for artfully to get these rules right based on significant public input but it is more important to get it right then to work against the clock and that is not what we are doing. we will get this right and move forward but until the cftc

completes its rule writing process and implement and enforce its new rules the public remained unprotected. i look forward to your questions. >> thank you, chairman gensler. acting chairman gruenberg. >> members of the committee, thank you for the opportunity to testify on the 1-year anniversary of the passage of the dodd-frank act. chairman johnson, thank you for your kind words. does occur to me that it was more comfortable for me to sit behind you on the dais than where i am right now. i am privileged to have the opportunity. the dodd-frank act provided the fdic important new authorities in systemic resolution. we believe will significantly enhance financial security and make significant progress toward

implementation. the fdic has no authority to manage the insurance fund in a way that will make it more resilience in the future. the fdic has implemented provisions in the act that increase the insurance covers with $250,000 and provide insurance coverage of the entire non-interest bearing account through the end of 2012. we have implemented changes in the assessment base mandated by the act which generally shifts the assessment burden from community banks to the largest institutions to rely less on funding. change in the assessment base of deposits and assets will result in aggregate increase of 30% with the positive insurance assessments in short institutions of assets under

$10 billion. in addition the act provided the fdic new flexibility setting the target size for positive insurance funds. we used the new authority to adopt a long-term fund management plan which should maintain a positive insurance fund balance even during the crisis. preserving steady and predictable assessment rates through economic credit cycle. this will enable us to avoid imposing pro cyclical deposit insurance assessment and financial institutions during an economic downturn. the dodd-frank act provides a new systemic resolution framework used in rare instances when we mitigate the systemic risk posed by the resolution of the financial company bankruptcy. the framework includes quarterly reputation authority and requirement for resolution plans with regulators to manage the

failure of large complex financial institutions. if the fdic is appointed receiver under the orderly liquidation of 40 we are required to carry out orderly liquidation in a manner that ensures creditors and shareholders maximizing the of our youth of assets, minimizing losses and mitigating risks and moral hazards. critical to the exercise of this authority is a clear and transparent process. the fdic board approved the final will implementing the orderly liquidation authority on july 6th. this provides a framework to resolve systemically significant financial institutions using many of the same powers to manage failed banks. the fdic and federal reserve board as ben bernanke mentioned working to implement new

resolution plan requirements. the comment period on wool making ended on june 10th and helped the final rule in the future. in order to carry out these responsibilities for the resolution of systemically important financial institutions the fdic has established a new office for complex financial institutions with three key functions, monitor the condition of systemically important financial companies from the standpoint of resolveability, oversee the federal reserve development resolution plan by these companies and engage with supervisors of foreign operations with regard to resolution plans. finally the dodd-frank act contains provisions that will complement the reform that will make capital requirements more uniformly strong across the banking system. section 171 of the dodd-frank

act makes capital requirement for the largest banks, not the capital requirements generally applicable to in short institutions. the fdic and the federal reserve recently finalized the rule implementing this. we made significant progress in the past year but still have considerable work ahead of us. we saw input from the public and continue to report to congress on our progress. the process is transparent as possible. implementation of these provisions will be to the financial system that is more stable and less susceptible to crises if and when they develop. thank you and i look forward to answering your questions. >> thank you, acting chairman gruenberg. acting comptroller walsh. >> thank you, members of the committee. i appreciate the opportunity to

be here to discuss the progress the regulatory agencies have made in implementing the dodd-frank act in the years since the law was passed. we weathered the worst financial crisis since the great depression but it will be years before we put its effects behind us. dodd-frank took steps to strengthen the financial system and guard against future crises and all of us are determined to implement those safeguards as quickly and effectively as possible. as i said in previous testimony the occ is involved in individual projects including interagency rulemaking that will have a significant impact on the financial system. the biggest single task has been to integrate the functions of the office of supervision into the occ but we have devoted considerable effort to the transfer of supervisory responsibilities to the new consumer financial protection bureau and we participated in the early work of the financial stability oversight council

which has the potential to serve against market disruption. regarding the t f integration i am pleased to report on monday 674 employes of the office of supervision reported for duty at the occ in offices from the country. we have worked hard to ensure a smooth transition and we have succeeded in moving to a single regulator for national -- we need every bit of the talent and experience to fulfil our combined supervisory mission and the men and women joining us have been fully integrated into policy and field units where their talents can best be utilized. we recognize the importance of communication to the industry so executives know what to expect from the combined agency and we helped 17 outreach meetings around the country and had 1,000 thrift executives join us for the meeting. as part of the transition we

have to engage in several rulesmakings affecting the thrift industry. we posted an interim final rule that published the t s --ots regulations going forward. we continue to review regulations that fits our own to see where improvements maybe in order. we published a final rule that a dresses a number of areas important for continuity of supervision after july 21st including assessments of federal savings association. that rulemaking published in the federal register addressed areas where dodd-frank made changes in the standard upon which the occ's rules on pre-emption was based. the rulemaking scales back current rules in a number of areas. the amendments eliminate the preemptions standards from regulations and eliminate pre-emption 4 operating subsidiaries of national banks and federally chartered thrifts,

limit federal savings associations with the same standard of conflict pre-emption that applies to national banks and recognize enhanced authority of state attorneys general provided under dodd-frank. we also implement new procedures for future preemption decisions including consultation with the cftc. we had considerable support for the cftc and insure cooperation between the occ and the new consumer bureau in our supervisory roles. in addition to participating in numerous informational briefings with staff we assisted in developing the agency's procurement and personnel management process to see the banks that will be supervising we executed a memorandum of understanding that allow us to share reports and examinations, supervisory letters, information on enforcement and other

confidential information. we agreed to provide transitional support for other functions including consumer complaints. the occ will continue to operate our customer assistance group to handle consumer complaints about the large banks now under cftc supervision. as we discussed in our last appearance before the committee we participated in the interagency effort to create an effective financial stability oversight council as a forum for participants to share views and expertise in a confidential setting on emerging risk across the system. the council will be an important venue for averting and addressing future market disruptions. dodd-frank also calls for a number of rulemakings an interagency rules to address credit risk retention, incentive compensation and margin and capital requirements among others. clearly we have a great deal of work ahead implementing many important provisions of dodd-frank but i am confident we will get it done in a way that

strengthens the financial system and protect it against the risks that led to the last crisis. i am happy to answer your questions. >> thank you for your testimony we will begin the questioning of our witnesses. will the clerk put five minutes on the clock for each member for their questions. secretary wolin, important to keep in mind the damage inflicted by the crisis and the wall street reform act will present or mitigate another crisis. could you highlight in your opinion the cost of the crisis and the most important benefits of the new regulatory framework? >> thank you for that question. the costs i tried to enumerate in my testimony were extraordinary. the financial system came to the brink of utter failure. credit markets froze up.

in this end the economy was enormously effective in a way that hurt all americans with respect to the availability of credit, with respect to the destruction of an enormous amount of wealth, lost jobs and lost homes and so forth. a key reason for that is we have a framework for the financial system that was manifestly inadequate. it had's and weaknesses that needed to be addressed but to do that, lead dodd-frank statute does that. it makes sure our financial system rests on a more stable and brazilian foundation requiring firms, especially those that are more risky and present more risk to the system to hold capital, to have a greater liquidity standards and leverage constraints. it brought the derivatives market and swap market out of darkness. that was an important factor that led to the crisis and

strengthen enormously consumer protection because we know that consumers did not have adequate information or in a position to make fundamental choices about the kinds of credit they undertook aunt that led to enormous amounts of credit being extended in ways that neither they nor the overall system could bare. in all these ways and others the dodd-frank backed makes strides to put us on a foundation that allows our financial system to contribute what it can to the economy and its growth which is the critical need we have as our country. >> i have a question for ben bernanke, acting chairman gruenberg 11 and acting comptroller walsh. we are concerned about the unnecessary regulatory burdens on financial institutions that

did not cause the crisis. can you describe what you're agencies are doing to insure we have an appropriate set of rules that are not duplicative, contradictory and overly burdensome to small businesses and small financial institutions? >> we agree small banks are critical to the financial system. they have the ability to make loans in a local community that large banks often do not have including loans for small businesses so it is important to minimize the burden on those banks. first of all the law itself emphasized it is focused on the largest firms and the most complex activities so the direct implications of the law for smaller firms, smaller banks is

less. that being said it is important for us as regulators to make clear to smaller banks that they are exempt and make sure they are effectively exempt. we are trying in our rules to provide more guidance to small banks about what applies to them and what doesn't apply to them. i think small banks will benefit for the fact that tougher rules in the biggest banks will create a more level playing field and be of assistance to them. finally i would mention leaving time for others that the fed has made a strong effort to reach out to smaller institutions for example our supervision committee has a subcommittee focused on making sure the rules we passed do not have excessive burden on small banks. we created a community bank council that meets three times the year with the federal

reserve board to give maximum feedback. we are taking a lot of steps to achieve that objective. it is an important one. >> acting chairman gruenberg? >> this is a matter of significant priority to the fdic because we are the leading federal supervisor to the majority of community banks in the united states. it is a matter we take seriously. one of the challenges community banks told about is the number of regulations required by dodd-frank, an issue for them sorting through which ones have relevance and applicability to them to respond to that on every financial institution letter we issue a letter for each regulation we provide a box on the front that specifically summarizeds the act but the

ability -- applicability of a quick short and place to go to identify the relevance of the regulation to them. in addition we have an ongoing statement of policy on the development and review of the fdic regulations and policy which requires regular periodic review of regulations and their impact and that is something we are undertaking specifically with regard to the implementation of the dodd-frank act. finally we also have a community bank advisory committee that has been helpful and one of the recommendations they made was to conduct a review of questioners and surveys that would require regulated institutions to fill out. in response to that review we have created a new place on the fdic website consolidating all of those surveys to racing will place institutions can go and they will be able to fill out

those questionnaires and surveys online which they were not able to do before. this is a matter of ongoing attention. >> acting comptroller walsh? >> i certainly join my colleagues in expressing the same concerns and the approach we're taking. 2,000 of 21 consent -- community banks. we have substantial outrage and internet based system that enables them to come and look at updates on regulation and remain apprised of things that are happening. they share the concern that there are a lot of rules and not sure what affect them and what doesn't and it is true most of those are aimed at larger institutions and more complex activities but we continue to work with them to understand those things that will affect them and many that won't. >> senator shelby?

>> it seems to me that after most crises we are told if regulators only had more resources they could have prevented what ever crisis it was. as a result the standard real -- response by congress is to grow the bureaucracy. dodd-frank hit this pattern because of dodd-frank leaders and regulators have seen their powers grow the american economy and their budgets also grow. dodd-frank landed over a 4,000 new government jobs. many of them very well paid. employees at the fcc and other agencies can earn $230,000 a year. meanwhile as we all know private sector job growth is in place. do we now have enough government bureaucrats to protect the financial system? >> let me go back to the premise

of your question which is i really do think -- i believe there is widespread agreement the regulatory structure before the crisis was inadequate. there were large gaps in our coverage. nobody responsible for looking at the system as a whole. there were significant weaknesses in the structure of the financial system including the shadow banking system and so on. i congratulate you on your attention early on to fannie and freddie and capital standards, these were things that were inadequate. so i think that this is not just a.less response. clearly a lot of things need fixing that we can improve and broadly speaking i believe the dodd-frank act covers the main perception of housing finance which was discussed earlier.

you need more people to carry out more regulations and in general to do a better job of overseeing private sector activity. that being said, we want quality more than quantity. we wanted done well and make sure there is clarity in terms of the rules that financial institutions understand what the rules of the game are so that we can achieve these results at the least cost to the financial system. let me say the fed does do regular cost-benefit analyses of all our rules and it is always our intention to try to meet the goals of the statute in the least cost way that we can. >> didn't the inspector general of the fed recently called that

into question, cost-benefit mythology that the fed was using that the claim was antiquated? >> i don't believe that is correct. there have been several studies. won by a group -- and another by the gao which is more related to the programs we did during the crisis. correct me if i am wrong but my understanding is the fed generally speaking took a positive view of consistent application of cost benefit principle to the rules we right. >> my understanding is the inspector general of the federal reserve revealed that the fed internal written policy for rulemaking procedures is 30 years out of date and does not adequately reflect current statutory requirements before cost benefit. if that is not right, maybe we

can both review this. if that is right, then the fed needs to step up to the plate assuming that is right. >> that is right. that is a statement of written policy and action will practice. we are very attentive to the cost and benefits. >> chairman gensler, i have asked you twice in written questions -- my colleagues and the whole committee -- how the cftc would exercise its authority with respect to financial institutions engaged in activities designated under that title. in both instances you responded with a discussion of the regulation of financial market utilities which doesn't answer the question. let me ask you again. what are the cftc's plans with respect to financial institutions other than financial market utilities?

what are the plans with respect to financial institutions engaged in activities designated by the council systemically important? >> thank you for clarifying. i do not think i fully understood the question in written form. title a addressed itself to financial market utilities and through the coastal there will be some designated -- we currently oversee 16 clearinghouses and some of them will be that. i don't know right now whether the council will designate any activities so that is why i did not envision and right now i suspect -- unless the colossal does that on activities we will focus on one, 2 or 3 clearing houses and no other institutions will come under title a.

>> recently approved rules lay the groundwork to determine which clearinghouses will be deemed systemically important. will the cftc provide clarity on whether it will allow clearinghouses more time before they must decide whether to accept or reject swap trades? >> it is up to the clearing house and their risk. clearinghouses will have a mandate but it is important that they do it. dodd-frank addressed it. they add to the side a mandate that only happens if we then also seek public comment. >> do you think the ability of systemically imports clearing houses to access the fed's discount window makes it more or less likely that clearinghouses will accept risks to their product or will you try to make

sure that they don't? >> i think it is our responsibility to make sure taxpayers their stand behind any financial institution like we stood behind before. >> i agree with you. the perverse outcome of the crisis is something we might do more of that and it is important we do everything in our rulewriting to make sure the public not stand behind the clearing houses or other financial institutions. >> thank you. >> on tuesday the chamber of commerce reported federal agencies are not keeping up with markets and technology and the regulated market is one in which they use current technology and techniques to keep pace with market developments. chairman gensler and chairman schapiro, the house committee is

proposing significant cuts which i assume would diametrically opposed this request that you keep up with markets through technology. what is your perception? >> thank you, senator. under the house appropriation we would cut $10 million of our information technology budget and the end result of that would be postponed critical investment in market surveillance technology. i talked with this committee many times about the flash crash last year and the implications for investors and public companies seeking reliable capital markets in which to raise money and the fact that it took the two agency's many months to diagnose what happened because of a lack of technology capability. we also needed to lay in the modernization of the system which is critical to public companies involving disclosures to our staff, capability to

analyze public company disclosure and much of the information we will be gathering as a result of dodd-frank that will be filed by the edgar system and the ability to bring in data as a result of dodd-frank for oversight of hedge funds, over-the-counter derivatives and consolidated audit trail in the reporting system moving forward apart from dodd-frank all require that we have the capacity to invest in technology and we have not had that and under the house bill we would not have that. >> technology is important so we can see -- efficiently provide the public protection. we spent $37 million in technology which is less than the largest financial institutions spend in one week and the industry spending $25 billion a year is less than

they spend in a day in one year. that is what we do. we think it would be helpful to double that and we only asked for 30% more people so technology as a way to be efficient, people's side and to oversee the markets which are seven times the size. important for the setting of aggregation so that we can aggregate that data, bring it in and use computers to do that which computers are good at. the house appropriation bill -- we couldn't do any of that with the cuts of 15%. >> in effect this is almost setting you up not only for falling behind these markets but failing even as any transparency or insight to the market. >> that is right. we will complete the rulewriting

process. it will be thoughtful and take longer than congress laid out but we will finish that rule writing process but i fear we won't have the people to answer the questions to be digital aggregate the market and put it on the web site, public market transparency needs technology and resources. >> we repeatedly said we won't be able to operation allies the dodd-frank rule. hopefully it will be reasonable and appropriate but the other area where we will fall behind is we receive 2,000 requests a year in the form of self-regulatory will findings and requests for exemption that no action letters and our capacity to keep up with that volume on a declining budget will be impacted and those are things industry really wants from us. they need that guidance and that relief from time to time.

everybody has a stake in agencies being in a position to do their jobs. >> it seems from your comments that having the worst of two world's. regulation on the books which were required under dodd-frank but resources to respond to legitimate questions of business to interpret the regulations that respond promptly to their requests. i would think the business community would be worse off in this situation because the liabilities are on the books but they can't get any traction. >> that is right. to follow what ben bernanke said it is in the interest of the industry to have expert people in the regulatory agencies who can efficiently do examinations and provide guidance and information as well as do the enforcement of the law we are charged with doing. the public has to understand

what the limitations are on the regulatory regime that has no compliance or enforcement behind it. >> the only real beneficiaries are not the only rank-and-file but those who deliberately will try to avoid following the law in hopes they won't get discovered because of lack of resources. the vast majority of business will be labor to do when they can but getting no helpful guidance. >> senator toomey. >> thanks to the witnesses for being back once again. two questions. i would like to direct to miss schapiro. you know better than anyone that last year the fcc developed a whole new set of rules and regulations regarding money market funds to tighten standards for credit quality and

enhance liquidity and short and portfolio maturities and meaningful measures to basically diminish the risks. significantly reduce the risk that any kind of run would be likely to occur or systemic risk from these funds. nevertheless we do hear a discussion from time to time that there is also an interest in moving -- what concerns me about a floating net asset value is the complexity of a minister in this or keeping up with the paperwork and tax implications that could be complex and onerous to a large part of the financial system. my question is imposing the net asset value, is that under consideration or off the table? >> fsoc is taking an interest in a money-market fund issues. we do a complete overhaul of

money-market funds for credit quality and liquidity standards a year ago and fairly universally apprised of being very helpful to build the resilience of money market funds and requiring reporting these so investors can become accustomed to the idea that value does fluctuate for money-market funds. we have discussed the issue and several times and held up public round table with all fsoc members in attendance to talk about how to present runs on money-market funds and what are the options available? we are actively discussing floating these ideas, one of the ideas that was raised in the president's working group, the study on money market funds and capital buffers. the industry came forward with a liquidity exchange bank.

there are number of areas we are having discussions. nothing has been decided but we continue to seek public input and fellow regulators input on what we can do to ensure we don't have a situation as we did when the reserve fund broke the buck and cause a run on money market funds in large part because -- and issue we are continuing to explore. >> i hope we will keep in mind what seems to me an absence of empirical evidence to suggest that this would solve the problem. and the fact that very substantial measures have been taken. a separate question i would like to address to mr. gensler and ben bernanke. this has to do with proposed margin rules for swaps under title vii. my understanding is these rules would require the subsidiaries of american banks operating overseas and doing business with

non american counterparts that the subsidiaries would be required to hold margin on behalf of their counterparts. it is my understanding the europeans and asians have not imposed comparable requirements. i am concerned that would put our firms at a competitive disadvantage with respect to transactions that don't occur on u.s. soil or have an american counterpart. are you concerned we are in the process of putting ourselves at a competitive disadvantage? >> thank you for the question. not just in the margin area but more broadly we have been working with international regulators to -- there is no geographic border. it will move somewhere else. more specifically we are reaching out with treasury as part of this and the federal reserve to have an international approach to margent the

regime's. on the back rules i will defer to ben bernanke because we are only setting margins -- there's a jurisdiction question. >> you are absolutely correct. if those margin rules for foreign operations are maintained and europeans and other foreign jurisdictions -- that would be a significant competitive disadvantage. the best solution we are pursuing some assiduously is a global agreement on margin rules for swaps and other instruments. we are working on that. if that doesn't happen we will need to think again about how to meet the dodd-frank requirements

for improved prudential safety which is what margins are intended to achieve without a disadvantageing our banks and foreign operations. our first choice is equalize the playing field. if that doesn't work we will look at many suggestions we received to think about how to address that issue. >> i would like to suggest it seems to me that if we have global uniformity that obviates the need for extraterritoriality in a regulation and with respect to margin requirements of users as we all know that can be very disruptive for the ability of the end user to hedge risks and problematic and essentially at the end of the day presumably the banking entities are qualified to make. >> at least in what we have

proposed the non-bank swap dealers would not be required to collect or receive margin from non-financial end users. i just wanted to -- >> thank you. senator menendez. >> thank you. news reports came out from the associated press and reuters that alleged that despite the regulators's assurances that the bank's illegal robotsigning was fixed the practice is still widespread. it is still going on for boat foreclosed homes and for homes that aren't in foreclosure which amounts to forging documents and in some cases wrongfully foreclosing on people which is why i and ten of my colleagues including several members of this committee and a dozen house members as well have written to

the occ, federal reserve and the fdic urging you that you make the foreclosure reviews and other foreclosure related documents fully transparent and that you release the results of those reviews on a bank by bank basis so the public can evaluate the performance of each bank. there's a tremendous interest in the public seeing these problems properly resolved. i want to ask those three agencies, the fed, the fdic and the occ will you release the results of the foreclosure reviews on a bank by bank basis? will you release the mortgage servicers action plan that response to problems in consent orders and what about the engagement letters for the, quote, independent consultants hired by the banks themselves to perform the foreclosure reviews

of the bank? >> we are as concerned about these issues as you are. we have issued cease and desist orders. we told the banks they have to engage independent consultants and making sure they are independent and provide supplementary diagnosis over and above the work we have done as well as action plans for the banks and we will be reviewing those action plans and the conformity of the banks to those plans. our current plan is to provide a report. we will share with you a public report that will explain the findings and what the proposals were and what the reactions were. >> i don't have less than 25 minutes. you are not going to have a

specific question. are you going to release the three entities i asked for? >> matt consult with my advisory teams and get back to you? >> surely. about the other two agencies. >> we will surge in late be releasing more information. >> i hate to interrupt but a very specific question, i don't want to be played with. are you going to release the mortgage servicers action plans that respond to the consent orders? are you going to release the foreclosure reviews on a bank by bank basis and are you going to release engagement letters for the independent consultants? it is yes or no. >> we have to evaluate individual documents and see if there's anything that would be of a confidential supervisory nature but we will release some information. >> not to duck your question but

the fdic is not a regulator of any of the servicers. is not within our authority. >> let me just say i hope you understand, chairing the subcommittee here, i hope you understand it is incredibly difficult to create public trust that the companies hired by the banks to perform foreclosure reviews are the same companies doing business with those banks that future business. i hope you have a little understanding that public trust as regulators when you are assuring us the problem of the bank's forging documents to foreclose on homes more easily has been fixed when news reports alleged the problem hasn't been fixed are still widespread. i am going to share with you the congressional research service analysis that i asked for to see if you had the legal wherewithal

to do this because i figured i would get that as an answer and their answer is our request, regulators have the discretion to release the results of bank by bank basis if they feel it is in the public interest and point out they can come to a middle ground when they release a report with high-level bank by bank results while still redacting low-level information that would be confidential to banks. rarely around here do we get ten members of the senate to focus on a specific request for information. a dozen members or so of the house of representatives. i think we need a little transparency in this process. if dodd-frank is about anything at the end of the day it is about taking and creating transparency and openness. i will be like a dog on a bone in this. i hope we get some good answers

because otherwise i will use every means possible along with my colleagues to get to the bottom of this. is not acceptable. it is not acceptable to violate the law. it is not acceptable to do robotsignings. there's a clear reason why the law dictates of procedure before you take over someone's most cherished and biggest asset in their life. that is not being pursued correctly. the agencies that are responsible for that given the assurance that it is and public reports constantly suggest that it is not. i am looking forward to your response. >> senator kirk. >> congratulations on your 97-2 win yesterday on the military the a bill --va bill. i want to focus on systemic risk and a central concept behind the

legislation because i am worried much of the crisis the american people suffered from was triggered by fannie mae and freddie mac. in my view because it was loaded with politically connected lawyers and lobbyists, that congress didn't reform it. the institution pretty much with the same cast of rogues is still running even though it was triggered and you guys weren't allowed to touch them. i am worried so often the government is slow, not innovative as opposed to the private sector and also you guys are politically controlled by us, by the white house, not allowed to look at new risks. one of the risks i am worried about is government accounting standards board recently proposed government entities be required to fully disclose

unfunded liabilities that they face particularly with regard to promised pension obligations. in 2009 the pews center published day $1 trillion gap report outlining 21 states with pension obligations funded at less than the 80% actuarial sound requirement recommended. this would be totally unacceptable for the public corporations you are allowed to torture and because systemic risk is now out there, under dodd-frank and a municipal investment advisers that you have, with the sec be recommending that municipal debt issuers conform to the gets the requirement? >> i want to be on strong legal grounds but let me say we brought some enforcement cases.

>> to new jersey and illinois where you alleged they were lying to their investors. >> a number of others are under investigation with the adequacy of their disclosure when they were doing bond issuances. we don't have the authority although we are preparing a report for congress to discuss these issues to mandate particular disclosure requirements for municipal issuers. we have been holding a series of round tables around the country to better soft municipalities and finance, investors and others to talk about how we might strengthen municipal disclosure system among other things and we were having a hearing in birmingham, alabama next week, home of jefferson county and we work on these issues.

there was disclosure of unfunded liabilities -- not everybody is required to utilize gasby. >> i hope you use your systemic risk authority because that is your get out of jail free cards to look at threats to the financial system and i worry states are so powerful and politically connected you will hold back. >> we won't hold back. >> another concept behind dodd-frank is too big to fail. what we have seen from 2008 to 2010 is in 2008 the top ten banks held 48% of all domestic banking and in 2010 the number of banks fell by 3% the top ten bancshares had grown to 53%. bank of america, j. p. morgan

chase, bank of new york mellon, and td bank. they are even bigger and less capable of failing than they were before dodd-frank. what can we do about that? >> you make an important observation. some of the increase in concentration the last few years was a byproduct of events, several medium-sized firms disappeared. it is not necessarily a trend we are seeing here. there are number of aspects which help address too big to fail. there are concentration rules like the authority of the fed not to approve a merger of financial stability concerns but the main issue that we have much

tighter oversight over sifis. one thing we noticed is banks and other institutions don't want to beat sifis. they consider an additional burden, and oversight to constrain them. if it was truly too big to fail they might refer to be designated sifis. the other thing that is crucial and still a work in progress in order to get rid of too big to fail we have to have failed. we need a way for the biggest firms to fail. you heard some discussion this morning about the fed and the fdic's work on the orderly liquidation of 40 -- authority. it will be a sign of success when we see large firms getting themselves smaller to try to get out of the oversight. out of the oversight. we see the cost of funding