Private Funds

Federal Deposit Insurance Corp. executed a passivity agreement with The Vanguard Group on Dec. 27 intended to mitigate risks of large investors from exerting undue influence over financial institutions in which they hold significant stakes. The agency indicated such agreements are necessary as a means of maintaining integrity and stability of the financial system. Read on »

A Delaware Federal District Court circuit judge gave approval for interlocutory appeal to answer questions regarding the Consumer Financial Protection Bureau’s (CFPB) constitutionality and the scope of its enforcement authority. The two issues arise from a 2017 enforcement action taken by CFPB against the National Collegiate Loan Trusts for engaging in forbidden debt-collection and litigation practices.

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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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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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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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As part of an effort to reorganize federal agencies in a way to make them more efficient and accountable, President Donald Trump’s administration is proposing to end the conservatorship of the government-sponsored enterprises (GSEs) and allow other privately owned entities to enter the secondary market to increase competition.

The proposal has elicited responses from trade associations representing mortgage bankers and credit unions, noting their hopes for what can be done to improve on the current guarantor structure.

Learn more details about how the plan would impact the housing finance system and what the industry is saying about it.

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Numerous financial trade organizations are hailing the Federal Housing Finance Agency’s (FHFA) recent proposal for reforming the housing finance system as further evidence of what they long have contended: the secondary mortgage market should incorporate private capital.

The FHFA recently published a report entitled, “Federal Housing Finance Agency Perspectives on Housing Finance Reform,” proposing that Fannie Mae and Freddie Mac should be reincorporated as private entities. FHFA Director Mel Watt also wrote to the Senate Banking Committee, detailing his views on the matter. 

Find out which recommendations the agency outlined closely align with proposals published by the financial industry. 

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Having long contended that conservatorship for the government-sponsored enterprises (GSEs) is unsustainable, Federal Housing Finance Agency Director Mel Watt recently testified to the Senate Banking Committee about actions he feels need to take place to work toward reforming the housing finance market. Read on to find out what he and members of the committee had to say about the issues facing the agency and Congress regarding the matter.  Read on »

The Securities and Exchange Commission’s Office of Compliance Inspections and Examinations released its examination priorities for 2015, focusing on certain practices and products that the office perceives to present potentially heightened risks to investors and capital markets.  Read on »

The mortgage industry breathed a collective sigh of relief when regulators unveiled a rule reproposal that would align the qualified residential mortgage (QRM) definition — a key element of Dodd-Frank’s risk retention framework — with the qualified mortgage (QM) provisions set forth under the Consumer Financial Protection Bureau’s (CFPB) ability-to-repay rule. However, industry participants hoping for workable final rules should familiarize themselves with the proposal and submit comments to regulators, said Kristie Kully, of counsel in the Washington, D.C., office of K&L Gates.

Public comments on the new proposal are due by Oct. 30.

Six regulatory agencies are working to implement provisions of the Dodd-Frank Act that require securitizers to retain at least 5 percent of the credit risk of the assets collateralizing asset-backed securities. The act also requires regulators to establish criteria for QRMs — certain mortgages that will be exempt from the risk-retention requirements.

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