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CRA reform could take many shapes
Posted Date: Tuesday, January 28, 2020
The financial industry is used to coping with uncertainty over when or if change is going to happen. When it comes to revamping Community Reinvestment Act (CRA) requirements, the real question is “how?”
Warren Traiger of Buckley LLP and Lilly Thomas of the Independent Community Bankers of America (ICBA) spoke to Dodd Frank Update about the possible ways the CRA framework could be reformed, based on priorities expressed by the three banking agencies.
Learn more details about the reform possibilities the industry could face in the future.
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Trades voice TRID liability, timing concerns
Posted Date: Thursday, January 23, 2020
No shortage of financial trade advocates answered the call for feedback as part of the Consumer Financial Protection Bureau’s (CFPB) assessment of its TILA-RESPA Integrated Disclosure rules.
Among the top priorities highlighted by nearly all commenters is uncertainty regarding timing restrictions and liability with regard to a Loan Estimate and a Closing Disclosure.
Learn what various trades had to say in their comment letters.
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CFPB sues mortgage companies, debt-relief servicers under FCRA
Posted Date: Tuesday, January 14, 2020
The Consumer Financial Protection Bureau (CFPB) accused two mortgage companies of obtaining consumer reports under false pretenses and assisting several student loan debt-relief companies charging illegal advance fees and deceiving customers.
The CFPB detailed charges of violations of the Fair Credit Reporting Act (FCRA), the Consumer Financial Protection Act and the Telemarketers Servicing Act in its complaint.
Get more details about the allegations.
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CFPB examiners detail consumer reporting issues
Posted Date: Friday, January 10, 2020
The Consumer Financial Protection Bureau (CFPB) detailed examination findings about consumer reporting issues in its second special edition of Supervisory Highlights.
The report focuses on commonly occurring issues in reporting and furnishing consumer credit information in accordance with the Fair Credit Reporting Act (FCRA) and Regulation V, as well as furnishers’ efforts to correct such issues.
Find out what types of issues examiners documented in the report.
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Senators to IG: Investigate CFPB’s restitution practices
Posted Date: Friday, January 17, 2020
The reduced amount of restitution being collected by the Consumer Financial Protection Bureau (CFPB) under Director Kathy Kraninger has spurred a group of Democratic senators to mobilize, calling for an investigation by the Inspector General of the Federal Reserve.
At the center of the lawmakers’ claims are four enforcement actions during Kraninger’s first year in office in which the CFPB called for defendants to pay little or no consumer redress.
Find out more details about the senators’ claims against the bureau and Kraninger.
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Former Wells Fargo execs charged in sales misconduct
Posted Date: Thursday, January 23, 2020
Former Wells Fargo Chairman and CEO John Stumpf and several other former senior executives have been charged by the Office of the Comptroller of the Currency (OCC) for their roles in facilitating the company’s high-profile sales practices misconduct which resulted in record fines and restitution for harmed consumers.
Although Stumpf is the most high-profile former executive named in this round of OCC action involving Wells Fargo, the company’s former community banking head, Carrie Tolstedt, received the steepest punishment.
Get more details about the settlement terms for each former executive.
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Patent infringement lawsuits hold vendor management lessons
Posted Date: Tuesday, January 7, 2020
Multiple patent infringement lawsuits involving Wells Fargo and the United Services Automobile Association (USAA) offer lessons about vendor management at a time when many financial entities are looking to offer technology comparable to (or better than) their competitors, but must do so without stepping on each other’s toes in a legal sense.
Patents involved in the cases pertain to remote deposit capture technology, which is used to allow retail banking customers to deposit checks via their mobile deposits.
Find out more details about the cases and the lessons they underscore.
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Moody’s highlights industry M&A risks with Texas deal
Posted Date: Tuesday, January 7, 2020
A $5.5 billion merger between two Texas-based regional bank holding companies recently highlighted the potential credit implications of such integrations between similar financial entities when Moody’s Investors Service rated the deal as credit negative for the newly combined entity.
Texas Capital Bancshares, Inc., and Independent Bank Group, Inc., reached a definitive agreement to combine all stocks in a merger of equals in December to create what the companies described in a press release as “the premier, Texas-based super regional bank.”
Learn more details about the historical trends behind the rating change.
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Colorado regulators block credit union from buying bank
Posted Date: Tuesday, January 21, 2020
One of Colorado’s largest credit unions was blocked from acquiring a community bank when state regulators determined that the deal did not align with statutory requirements in Colorado.
The Colorado Banking Board voted 6-1 to deny Elevations Credit Union’s proposed purchase of Cache Bank & Trust on the grounds that state law prohibits acquisitions between different types of financial institutions.
Learn more details and reactions regarding the situation.
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FDIC, OCC: Geopolitical tensions mean more cyberrisk
Posted Date: Thursday, January 23, 2020
Heightened geopolitical tensions mean financial institutions could be at higher risk of facing a cyberattack, according to the Federal Deposit Insurance Corp. (FDIC) and the Office of the Comptroller of the Currency (OCC).
With that in mind, the agencies issued a joint statement on “Heightened Cybersecurity Risk” urging financial institutions to reevaluate their information security safeguards and make upgrades where necessary.
Get more details about what measures the agencies recommend.
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Black Knight: More than 9 million good refi candidates
Posted Date: Thursday, January 23, 2020
As mortgage rates moved lower once more, to their lowest mark since early October, Black Knight reported that its pool of high-quality candidates for a refinance had grown again.
The company reported that more than 9 million borrowers could gain from a refinance, saving an average of more than $260 a month.
How steady is that pool of high-quality candidates? Read on for more details.
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PNC reports uptick in 2019 mortgage income
Posted Date: Thursday, January 23, 2020
PNC Financial Services recorded $1.4 billion of its $5.4 billion 2019 net income in the fourth quarter, according to its latest earnings report. The bank ended the year with an uptick in residential mortgage income compared to a year prior.
The report also notes the company’s growth in both consumer and commercial lending throughout the year, as well as in the fourth quarter.
Learn more details disclosed in the report.
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Bank survey indicates increased compliance costs
Posted Date: Thursday, January 23, 2020
A majority of mortgage lenders have seen an increase in compliance costs related to recent regulatory reforms, according to the American Bankers Association’s (ABA) 26th Real Estate Lending Survey.
The results also indicated an uptick in loans sourced through retail channels and insight about fintech investments and non-QM lending activity.
Find out more details about the results.
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Absolute Home Mortgage to acquire HausM, continue expansion
Posted Date: Wednesday, January 22, 2020
Absolute Home Mortgage Corporation, a technology-based mortgage origination company, recently entered into an agreement to acquire the origination platform of Haus Mortgage (HausM), a Chicago-based residential mortgage originator and digital marketing provider.
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Kraninger proposes to extend GSE patch, replace DTI measure
Posted Date: Tuesday, January 21, 2020
As questions loom as to what the secondary mortgage market will look like in two years, Consumer Financial Protection Bureau Director Kathy Kraninger decided the bureau should extend its temporary measure allowing for certain exceptions to its Qualified Mortgage standard, also known as the “GSE patch.”
The letter also indicates that the CFPB plans to propose an amendment to the current rule to replace debt-to-income ratios with a new measure of credit risk.
Find out more about the proposed changes.
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CFPB adds third former FTC member to taskforce
Posted Date: Tuesday, January 21, 2020
The Consumer Financial Protection Bureau has added a third alumnus of the Federal Trade Commission to its Taskforce on Federal Consumer Financial Law.
The bureau announced the selection of four members to serve on the taskforce earlier this month.
Read on for more information about the late edition to the taskforce.
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Wells Fargo issues first earnings report under Scharf
Posted Date: Tuesday, January 21, 2020
Wells Fargo reported $2.9 billion in fourth-quarter profits to finish 2019 with $19.5 billion in net income for the year. The bank’s positive mortgage numbers helped offset declines in other areas.
The bank’s earnings report for the fourth quarter was the first released since Charlie Scharf was tapped to be Wells Fargo’s new CEO and president in September.
Get more details about the report’s findings, including its best fourth quarter for originations since 2016.
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U.S. Bancorp reports earnings for fourth quarter 2019
Posted Date: Tuesday, January 21, 2020
U.S. Bancorp brought in nearly $1.5 billion in net income during the fourth quarter of 2019 to end the year with just shy of $23 billion in revenue.
The company indicated a significant increase in fourth-quarter mortgage banking revenue, year-over-year.
Learn more details from the company’s latest earnings report.
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CFPB 2019 employee survey reveals few changes
Posted Date: Friday, January 17, 2020
Internal opinions of senior leadership and the organization as a whole have improved slightly at the Consumer Financial Protection Bureau during Kathy Kraninger’s first year as director, according to the bureau’s 2019 employee survey results.
Employee satisfaction within the bureau remains markedly lower than it was under former Director Richard Cordray.
Find out more information about the survey results.
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Leandra English joins NYDFS as policy advisor
Posted Date: Friday, January 17, 2020
Leandra English, the former deputy director of the Consumer Financial Protection Bureau (CFPB), recently joined the New York Department of Financial Services (NYDFS) as a special policy advisor to Superintendent Linda Lacewell.
English brings nearly 10 years of experience dealing with consumer financial protection laws to the department, having served in various leadership capacities at the CFPB, as well as at other organizations focused on consumer protection issues.
Learn more details about her new regulatory oversight role.
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JPMorgan Chase reports record profits for 2019
Posted Date: Friday, January 17, 2020
JPMorgan Chase posted its most profitable year ever in 2019, capping it off with an $8.5 billion (21 percent) growth in net income in the fourth quarter to finish the year with $29.9 billion in profits.
The bank recorded $474 million in profits from mortgage fees and related income in the fourth quarter, more than double the $203 million it saw in the fourth quarter of 2018.
Learn more details about the bank’s earnings.
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Bank of America gets boost from residential mortgages
Posted Date: Friday, January 17, 2020
Bank of America reported $7 billion in net income in the fourth quarter of 2019, closing the year with $27.4 billion in profits over the last 12 months.
Much of the bank’s positive performance in the fourth quarter and throughout 2019 can be attributed to strong growth in its residential mortgage business.
Find out more details about the bank’s 2019 earnings.
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Report: Banks effective in preventing fraud
Posted Date: Friday, January 17, 2020
Fraudsters attempted to steal $25.1 billion for bank deposit accounts in 2018, according to the American Bankers Association’s (ABA) 2019 Deposit Account Fraud Survey. Banks’ efforts to safeguard deposit those accounts saved $22.3 billion of those funds from theft – the equivalent of $9 for every $10 in attempted fraud.
The ABA survey has been conducted biennially on a national basis since 1993, tracking data on various types of fraud including check, debit, bill pay, person-to-person (P2P) transfers, wire and automated clearinghouse (ACH) transactions.
Find out more details from the report.
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Bill would nix Section 1071 mandate
Posted Date: Tuesday, January 14, 2020
As the Consumer Financial Protection Bureau (CFPB) has taken what seem to be positive steps towards implementing long-anticipated rulemaking on small business loan data collection under Director Kathy Kraninger, the agency has faced no shortage of resistance from the financial industry.
A piece of legislation introduced by Rep. Roger Williams (R-Texas) seeks to eliminate the section requiring the rulemaking in the first place.
Find out more details about the legislation.
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CFPB issues NAL to Bank of America
Posted Date: Tuesday, January 14, 2020
Bank of America, N.A., will be shielded from adverse regulatory actions with respect to its funding arrangements with housing counseling agencies certified by the U.S. Department of Housing and Urban Development (HUD) thanks to the Consumer Financial Protection Bureau’s (CFPB) first no-action letter (NAL) since revising its NAL policy in September.
In accordance with the revised policy, Bank of America listed various potential consumer benefits and concerns associated with the HCA funding arrangements in its NAL application.
Learn more about the terms of the agreement.
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Fed makes 2019 payment to Treasury
Posted Date: Tuesday, January 14, 2020
The Federal Reserve is primarily attributing a year-over-year dip in total net income recorded collectively by the nation’s Reserve Banks to a drop in certain interest income tied to securities combined with an uptick in certain security-related interest expenses on securities.
The Reserve Banks have seen a drop in net income in each of the last four years.
Read on for information.
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Citigroup ends 2019 with positive fourth-quarter earnings
Posted Date: Tuesday, January 14, 2020
Citigroup Inc. finished 2019 with stronger fourth-quarter earnings numbers than 2018, reporting upticks in net income, compared to 2018.
The company attributed its positive earnings results to higher revenues and a lower effective tax rate, partially offset by higher expenses and an uptick in the cost of credit.
Find out more details about the company’s latest earnings report.
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OptifiNow unveils advanced reporting, business intelligence engine
Posted Date: Friday, January 10, 2020
OptifiNow recently unveiled a new business intelligence engine called Insights onDemand, which the company built into its flagship OptifiNow CRM platform. BI Insight was designed to combine sales and marketing data managed in the OptifiNow CRM with external data sources to provide a 360-degree view of business performance, according to a company press release.
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Fed lays out its CRA priorities
Posted Date: Friday, January 10, 2020
Having avoided joining with two of its regulatory counterparts in endorsing plans to revamp Community Reinvestment Act (CRA) regulations, the Federal Reserve’s ideas regarding CRA reform became clearer in a recent speech by Fed Governor Lael Brainard.
Amid her nuanced account of what changes the Fed has determined might be appropriate in reforming CRA standards, her main point on the matter was quite succinct, asserting that the focus should be getting it “right” rather than getting it done quickly.
Learn more about the key takeaways from her speech.
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Carranza confirmed as SBA administrator
Posted Date: Friday, January 10, 2020
The Senate voted to confirm Jovita Carranza of Illinois to become the administrator of the Small Business Administration (SBA) by an 85-5 margin. The lopsided vote came nine months after she was nominated by the Trump administration in April.
Carranza’s nomination came after Linda McMahon, Trump’s first Senate-confirmed SBA administrator, resigned.
Find out more details about the vote and Carranza’s background.
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CSBS reports positive community banker sentiments
Posted Date: Friday, January 10, 2020
Community bankers entered 2020 with a fairly optimistic attitude about their businesses and the financial marketplace in which they operate, according to the Conference of State Bank Supervisors’ fourth quarter Community Bank Sentiment Index.
The fourth quarter index is the third since the organization began tracking community bank sentiment in the second quarter of 2019.
Find out more details about the findings related to the index.
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CFPB names members of Federal Consumer Financial Law taskforce
Posted Date: Friday, January 10, 2020
The Consumer Financial Protection Bureau has named four members to serve on its new Taskforce on Federal Consumer Financial Law.
The taskforce will examine the existing legal and regulatory environment facing consumers and the financial industry and recommend changes that could be beneficial to all stakeholders.
Learn more details about the taskforce and its members.
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CRA proposal published in Federal Register
Posted Date: Friday, January 10, 2020
The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corp. published their proposed rule for modernizing Community Reinvestment Act (CRA) regulations in the Federal Register on Thursday. Interested stakeholders will have 60 days from the proposal’s publication to comment on its provisions.
The proposal includes the two agencies’ recommendations for establishing new assessment areas, new testing parameters and expanding the types of activities that qualify for CRA credit, among other details.
Learn specifics about the comment period on the proposed rule.
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Gateway First Bank opens 34 new mortgage centers
Posted Date: Thursday, January 9, 2020
Gateway First Bank opened 34 new mortgage centers in 2019 in response to an uptick in demand from local communities for home financing, the company announced in a press release.
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Banks to SEC: Leave CECL out of disclosure updates
Posted Date: Tuesday, January 7, 2020
Offering feedback on the Securities and Exchange Commission’s (SEC) proposed updates to statistical disclosures which SEC-registered financial institutions provide to investors, some banking industry advocates urged the agency to leave out requirements on current expected credit loss (CECL) disclosures.
Banking trade advocates encouraged SEC officials to hold off on creating CECL-related disclosure requirements until CECL standards are developed fully.
Find out more details about the proposal.
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Agencies create no-action policy for Regulation O
Posted Date: Tuesday, January 7, 2020
In a move intended to stem growing risk of potential market disruptions, federal banking regulators outlined plans to offer relief to banks extending credit to fund complex-controlled portfolio companies.
The agencies stated that they would not take action against banks that lend to such entities that violate Regulation O, provided they meet certain criteria.
Learn more about the new relief measure.
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Report: Banks well-positioned against downturn, disruptors
Posted Date: Tuesday, January 7, 2020
Despite predictions of slowing growth over the next year, Kroll Bond Rating Agency (KBRA) is predicting that the banking industry is well-positioned to remain stable in its “2020 U.S. Banking Outlook: Resilient Despite Headwinds.”
In its report, KBRA credits regulatory actions, policymaker initiatives and effective market discipline as catalysts for positive changes in banking fundamentals since the financial crisis.
Find out more details outlined in the report.
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Agencies to review risk retention rule
Posted Date: Friday, January 3, 2020
The financial industry has been afforded the first month of 2020 to weigh in on a mandatory review of the risk retention mortgage (QRM) final rule, finalized in 2014 in accordance with the Dodd-Frank Act.
Stakeholders also are encouraged to suggest potential changes to the Consumer Financial Protection Bureau’s Qualified Mortgages definition, which is aligned with the QRM standard.
Learn more details about what the review will entail.
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OCC appeals ruling on non-bank charters
Posted Date: Friday, January 3, 2020
The Office of the Comptroller of the Currency is turning to the Second Circuit Court in an effort to continue its years-long battle to begin accepting special-purpose national bank charter applications from fintechs and other non-depository institutions.
The agency appealed a final judgment handed down by the District Court for the Southern District of New York in October which asserted that the agency lacks the statutory authority to issue national bank charters to entities that do not accept deposits.
Learn more details about the on-going situation.
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Trades to Calabria: Finalize GSE capital rule ASAP
Posted Date: Friday, January 3, 2020
Numerous financial trade associations wrote Federal Housing Finance Agency (FHFA) Director Mark Calabria to stress the urgency of publishing a new regulatory capital rule for Fannie Mae and Freddie Mac in the Federal Register.
The trades cited several possible economic and political ramifications that could negate progress toward finalizing a rule to recapitalize the government-sponsored enterprises.
Find out more about the specific concerns expressed in the letter.
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Fed finalizes changes to promote payment system adoption
Posted Date: Friday, January 3, 2020
The Federal Reserve recently finalized new modifications to its National Settlement Service (NSS) and Fedwire Funds Service to support system enhancements and to reduce processing and settlement delays.
The Fed also announced it will extend its operating hours to promote adoption of the same-day automated clearinghouse system.
Find out more details about the changes.
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Banking agencies release adjusted CRA thresholds
Posted Date: Friday, January 3, 2020
The federal banking agencies recently announced an increase to asset-size thresholds for 2020 which will impact Community Reinvestment Act (CRA) examinations for banks of varying size classifications.
The annual adjustments are statutorily required and are based on year-to-year changes in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers.
Get more details about the newly adjusted thresholds.
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CFPB releases 2019 Financial Literacy Report
Posted Date: Friday, January 3, 2020
The Consumer Financial Protection Bureau recently issued its Financial Literacy Annual Report for fiscal year 2019, which details the bureau’s efforts toward fulfilling its statutory mission of improving consumers’ understanding of financial topics.
Highlighting the agency’s reasoning behind its emphasis on promoting good saving habits, the report includes statistics regarding consumers’ financial well-being and details the agency’s goals and strategies for improving financial literacy throughout the country.
Read on to learn more information.
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