The CFPB's policy statement seems mostly reasonable and straightforward. There are, however, embedded assumptions that should be examined. First, the CFPB describes "unequal bargaining power" as potentially an indication of abuse. As a practical matter, given the legal nature of financial institution loans to consumers, the CFPB analysis appears to create a presumption (rebuttable) that all loans are abusive. Second, the CFPB appears to assert that a loan that goes into default may…

Because the collateral posted by the banks is valued at par, which will generally be higher than market value given the sharp rise in inflation and interest rates, the Federal Reserve Board is effectively lending on a partially unsecured basis.

Before bemoaning the regulators' powerlessness to spot the problems at SVB and Signature, and adopting yet more laws and regulations, it is important to consider exactly what went wrong.  

Was it really the case that the bank regulators did not have the ability, given the existing statutory framework, to detect that the failed banks suffered from significant liquidity mismatches?  Likewise, while high interest rates were certainly a material contributing factor to the banks…

For all the discussion of new technologies and business models, the SVB failure seems remarkably old-fashioned. The bank borrowed (took deposits) over night and invested in long maturity securities. When inflation hit and interest rates rose, SVB got crushed.