The countdown has begun as we approach the one year mark anniversary of the passage of Dodd-Frank when provisions begin kicking in and a number of which funnel into a vacuum. The 2,300 pages will require over 240 separate implementing legislations, the creation of several new federal organizations, the merger of others, and rules over a dozen areas of financial services. Its intent is to prevent a shadow banking system to exist and to provide an orderly transition if a systemic crash is threatened. We laud these aims as we all remember vividly the “crash”. As much as Dodd-Frank is talked about no one person or agency really understands all of it, nor is there a definitive study on its effects and how to make it better. Further clouding the banking landscape is other legislation and rules passed that simultaneously impact, in some cases more directly, such as the FATCA legislation, the IRS ruling which will require reporting on accounts of NRAs, Basel 3 among others. Hampered by deficits the government has attacked the banking system to deputize them to collect taxes world wide, a costly role and one for which they are ill suited.

Where does this all leave us? With uncertainty, concern, and reactionary over-regulation. We do know that the derivatives provisions, over 100 of them, that were scheduled for July 16 have been put off for six months as you could not have trading over an exchange that did not exist with rules that were not written. The law requires that certain risk be rated but the new rating agencies that are to perform this task also do not exist. We know that interest will soon be paid on checking accounts for businesses and that banks will receive a lesser few on credits cards. This will lower earnings that will have to be made up somewhere and will probably lead to credit card cancelations for marginal credit risks.

We know that significant new and more complex documentation will be required for consumer protection, again costly for financial institutions. We know that the regulators are vigorously enforcing stronger credit standards making it much more difficult to refinance a mortgage and freezing out lower income applicants by requiring large down payments. The latter surely has an effect on the housing and real estate markets. It is more cost effective for a bank to foreclose than to restructure. Small businesses are having their loans called and their credit card debit limits lowered with little alternative credit available. Thus the creators of 70% of new jobs are holding fast and slowing job creation. We see money flowing out of the US in torrents as foreign investors no longer consider the US a safe haven and foreign banks are leaving the US almost daily. Isn’t any one looking at the big picture?

In spite of this, we are adjusting to the new normal. We just have to understand the rules when someone knows them well enough to explain them. Banks are lending and seeking new clients. The system is stronger and better capitalized. Governments are cooperating. We are learning from our mistakes. And the government will find a way to stimulate the economy in an election year. But it will be a bumpy road in getting there and job creation will be slow. So will the housing market with such tight credit standards. And Dodd-Frank will dominate the banking news for better or for worse.

On the front lines of the banking world the battle goes on. Regulators are now stepping over a long-standing divide between enforcing basic rules and playing a major part in business decisions. One wonders if the regulators in the field are in sync with the rhetoric of the administration, when there are reports of a regulator leaving an examination with tears in her eyes because she could find nothing wrong and feared for her job when she had to report that to her supervisory. Or when regulators report in private to the banking officers that the mood in the department is to eliminate all of the small community banks with assets under 500 million so they would have less to bother with. Regulators are still stinging from the lashing they got from Congress for having missed the real estate credit mess (probably because a good bit of their resources were tied up in enforcing the Patriot Act and chasing illusionary terrorists) that they are bound to make amends. They are particularly harsh on restructuring and new credits to small business. And somewhat appalling is their almost complete control on who gets hired and who doesn’t for banks trying to dig themselves out of trouble. They have the final say and it is capricious – almost never in writing. Unlucky is the one who falls victim to the economic backwash for they have no higher court of appeals. In all matters of banking business the regulators rule supreme – there is no higher court of appeals.

Spring marks the beginning of the H-1B season as every year on April 1 there are 65,000 H-1B visas released for an employment starting date of October 1. With the overall limit there are sub limits of 5,800 visas allocated specifically to citizens of Chile and Singapore. Another 20,000 are available to foreign nationals gradating with a Masters or higher degree from a US graduate school. This accounts for a little less than half of the all over quota.

For the remaining applicants, an H-1B is available for work in “specialty occupations” which is loosely defined as a job which requires a bachelor or higher degree for entry into the position. The specialty occultation is one which also requires the theoretical and practical application of a body of highly specialized knowledge. Bankers and financial analysts do qualify as “specialty occupations. For a country this size having only 30,000 plus at large slots, with engineers, software experts, and the like, plus special categories in the academic world, makes the process a real challenge for visa seekers.” The visa allows one to work 3 years with the sponsoring company which is extendable for another three years thereafter. This visa is transferable to another sponsoring institution. An L1 visa, an intercompany transfer, is sometimes an alternative but it is complicated, non transferable and to stay with a change of status, one has to go through the H-1B application or a similar process. Pending a green card or one in progress, which allows the foreigner to stay, at the end of this 6 year period it is back home, it’s been nice to know you.