The Mortgage Bankers Association (MBA) is welcoming federal banking agencies’ Basel III reproposal, calling it a “pivotal step” toward more balanced capital standards, even as the group continues to press policymakers for critical revisions to recent congressional housing legislation and presidential executive orders.

Following the March 19 release of proposed revisions to the Basel III framework by the Federal Reserve, the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp., MBA President and CEO Bob Broeksmit highlighted significant advocacy wins.

Basel III is a global banking framework developed after the 2008 financial crisis that established revised standards for bank capital requirements and other liquidity considerations. According to a formal statement released by the MBA, the new proposal incorporates several industry priorities, including the use of risk-sensitive capital requirements based on loan-to-value ratios and reduced capital penalties on mortgage servicing rights and commercial real estate loans.

In a subsequent video update published Monday, Broeksmit described the original July 2023 Basel III proposal as “flawed and unworkable,” attributing the recent changes to more than two years of sustained MBA advocacy.

With a public comment deadline set for June 18, Broeksmit noted the MBA plans to push for further refinements. These include reestablishing a 50% risk weight for warehouse lines across all banks and fully recognizing the value of private mortgage insurance to lower the capital banks must hold against insured loans.

Beyond capital requirements, the MBA is actively urging the U.S. House of Representatives to fix structural elements in the Senate-passed 21st Century Road to Housing Act. While acknowledging the bipartisan measure includes positive provisions to boost housing supply and expand mortgage lending, Broeksmit outlined concerns, including restrictions on institutional investors and a new requirement that servicers provide foreclosure mitigation counseling paid for from Federal Housing Administration insurance reserves.

Finally, the MBA president addressed two recent housing-related executive orders signed by President Donald Trump aimed at reducing regulatory barriers to construction and expanding mortgage credit access.

“MBA strongly supports the efforts to reform appraisals, ease construction regulations and encourage homebuilding,” Broeksmit stated. “We also appreciate the administration’s focus on addressing costly mortgage regulations that have increased costs and limited access to credit.”

But Broeskmit called many of the core reforms “narrowly targeted” at smaller banks, claiming they would exclude independent mortgage banks and other key market participants.

“Given that IMBs, credit unions and large banks account for more than 80% of the single-family mortgage market, the EOs’ current approach would reach only a limited share of lenders and borrowers,” the MBA leader maintained.