#FHA – Federal Financial Analytics

17 03, 2023

DAILY031723

Eliza Allen2023-03-17T16:53:13-04:00March 17th, 2023|2- Daily Briefing|

Biden Positions White House On Side Of SVB/SBNY Enforcement Actions

Reflecting growing political heat as SVB/SBNY revelations continue, President Biden today called on Congress to toughen enforcement penalties for senior management at failed banks. As noted on the fact sheet accompanying the formal request to Congress, the White House believes current law makes it unduly difficult for regulators to claw back executive compensation following a receivership and/or to bar individuals from further banking-industry employment.

HUD Reinstates Tough Disparate-Impact Standard

HUD today announced a final rule rescinding a 2020 rule governing Fair Housing Act disparate impact claims (see FSM Report FAIRLEND8) and restoring a 2013 discriminatory effects rule (see FSM Report FAIRLEND4). The fact sheet accompanying the announcement claimed that the complications added in 2020 rule would have made it “virtually impossible” for HUD and private plaintiffs to prove discrimination.

Waters Pledges Bill on Failed-Bank Execs, Pushes Incentive-Comp Regs

Shortly after the President called on Congress to toughen penalties for failed bank executives, HFSC Ranking Member Waters (D-CA) sent a letter today to Fed, FDIC, and SEC leadership announcing she is crafting legislation to do so. The letter also reiterated Democratic calls for the agencies to hold SVB and SBNY executives accountable and urged them to finalize longstanding compensation rules (see FSM Report COMPENSATION30), which Ms. Waters demanded include strong clawback provisions.

Daily031723.pdf…

27 02, 2023

DAILY022723

Eliza Allen2023-02-27T16:39:49-05:00February 27th, 2023|2- Daily Briefing|

FRB-NY: CRA Now Makes No Measurable Difference

As the banking agencies wrestle with their still-unfinished CRA rule (see FSM Report CRA32), the Federal Reserve Bank of New York today released a staff report concluding that the law has little to no impact on like-kind household credit in target areas. Using data available only to the Fed, the report finds that banks largely meet CRA in target areas by acquiring existing mortgage loans, not making new ones.

SCOTUS Re CFPB Has Broad Ramifications

In a case with significant implications not only for the CFPB, but also other financial agencies, the Supreme Court today agreed to review the Fifth Circuit’s decision invalidating CFPB funding via transfers from the Federal Reserve’s income rather than annual Congressional appropriation.

CFPB Puts A Repeat Offender Out Of Business

Wielding the hammer Director Chopra claimed when he announced his campaign against repeat offenders, the CFPB today used the powers it argues derive from its authorizing law (see FSM Report CONSUMER14) to put a nonbank mortgage lender out of business. In this case, RMK Financial was found to have persistently violated a 2015 agreement under consumer-finance laws and rules to mislead veterans about the terms of their VA and FHA mortgages.

Daily022723.pdf…

22 02, 2023

DAILY022223

Eliza Allen2023-02-22T16:44:44-05:00February 22nd, 2023|2- Daily Briefing|

BIS Backs Away From Old CBDC, Presses New “Unified Ledger”

BIS General Manager Agustín Carstens today distanced the global central bank somewhat from its prior calls for two-tier CBDC as quickly as possible (see Client Report CBDC6).

Administration Drops FHA Premiums in Broad Housing Push

In a victory for mortgage lenders and defeat for private mortgage insurance and the GSEs, Vice President Harris announced that FHA will shortly reduce mortgage premiums by .30 percent, saving the average homeowner $800 in total premiums or $67 a month.

GOP Opens Anti-CBDC Campaign

Starting the GOP’s 2023 campaign against CBDC with a specific initiative, Rep. Tom Emmer SP (R-MN) and nine Republicans have introduced H.R. 1122.

FDIC Found Remiss re Systemic Resolution

In its assessment of challenges facing FDIC leadership, the Office of Inspector General (OIG) finds that the agency may not be ready to handle an OLA or systemic resolution, nor is it yet able to assess climate financial risk and sanctions compliance.

FHFA Looks Into FHLB-Member Community Activities

Perhaps advancing FHFA Director Thompson’s commitment to review aspects of the FHLB System, her agency today released a request for views on the extent to which a Home Loan Bank member supported its community to retain eligibility for long-term System advances.

Daily022223.pdf…

30 01, 2023

DAILY013023

Eliza Allen2023-01-30T16:59:06-05:00January 30th, 2023|2- Daily Briefing|

FDIC Sets New Comment Deadline For Advertising NPR

The FDIC today extended the comment deadline for its NPR modernizing restrictions on the agency’s official sign and logo, advertising statement, and misrepresentations of deposit insurance coverage by 45 days until April 7.

Banking Agencies Report No Material Differences in Capital, Accounting Rules

Ahead of efforts later this winter to rewrite large-bank capital standards, the banking agencies today submitted their annual report to HFSC and Senate Banking assessing the differences between the agencies’ accounting and capital standards.

HFSC Lays Out Initial Action Plan

HFSC Chairman McHenry (R-NC) is moving forward, today announcing plans for a meeting on Wednesday to set the committees’ rules and near-term oversight priorities.

Controversial CFPB Initiatives Advance

The Federal Register today includes the CFPB’s nonbank enforcement action registry proposal as well as its circular regarding negative option marketing practices.

FHA Expands Loan-Mod Options, Incentives

The FHA today announced it will extend incentive payments to mortgage servicers that complete COVID-Recovery loss-mitigation options, also releasing several other changes to help struggling borrowers avoid foreclosures regardless of the nature of repayment hardship.

Daily013023.pdf…

1 06, 2022

FedFin: How Adverse Is This?

Arezou Rafikian2023-02-21T12:50:01-05:00June 1st, 2022|The Vault|

As detailed in our new in-depth report, the CFPB has issued another sweeping rule by way of a seemingly innocuous circular not subject to public notice and comment. Under it, lenders that use third-party underwriting are responsible for ensuring that borrowers receive thorough adverse action notices even if the lender has no authority over the AI or other complex models determining credit outcome.

The full report is available to subscription clients. To find out how you can sign up for the service, click here.

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1 06, 2022

GSE-060122

Arezou Rafikian2023-02-21T12:49:48-05:00June 1st, 2022|4- GSE Activity Report|

How Adverse Is This?

As detailed in our new in-depth report, the CFPB has issued another sweeping rule by way of a seemingly innocuous circular not subject to public notice and comment. Under it, lenders that use third-party underwriting are responsible for ensuring that borrowers receive thorough adverse action notices even if the lender has no authority over the AI or other complex models determining credit outcome.

GSE-060122.pdf…

24 05, 2022

DAILY052422

Eliza Allen2023-02-21T13:49:08-05:00May 24th, 2022|2- Daily Briefing|

BIS Committee Fears Debt Build-Up Poses Systemic Risk

The BIS Committee on the Global Financial System has concluded that sharp increases in household and corporate debt pose increasing systemic risk.

CFPB Creates New Competition Office, Plan

Reflecting its director’s continuing focus on consumer-finance competition, the CFPB today recast an office that previously encouraged “sandbox” product launches into an office focused principally on enhancing the ability of small firms and start-ups to compete with big banks, fintech, and bigtech.

FRB-Dallas Staff: TALF Worked for CMBS

The Federal Reserve Bank of Dallas has issued a new report documenting the manner in which Fed support at the pandemic’s outset supported U.S. commercial real estate.

IDIs Sound, but Worrisome Signs

The FDIC’s report on banking-sector 1Q data shows that, despite continuing strong earnings and robust credit quality, some IDIs are facing serious challenges.

HFSC Disabilities Hearing Confirms Little Appetite for New Legislation

As anticipated, HFSC’s Subcommittee on Diversity and Inclusion hearing today covered issues faced by persons with disabilities such as under-banking, unemployment and housing inaccessibility.

Brainard to Lay Out Key CBDC Considerations

The HFSC staff memo today on Thursday’s CBDC hearing confirms that it will be a consequential session.

HFSC Backs OLA, Climate Action in FY23 Budget

The House Financial Services Committee today released its views on the FY2023 budget, detailing broad support for the administration’s financial stability, climate, and housing efforts to guide its future authorizing work and that of the appropriations committees to the extent they heed HFSC’s request.…

16 05, 2022

GSE-051622

Max Camateros-Mann2023-02-21T15:06:12-05:00May 16th, 2022|4- GSE Activity Report|

Minimizing Mortgages, Maximizing Community Service

As we noted last week, the federal banking agencies sighed a mighty sigh and heaved up a massive inter-agency proposal rewriting decades-old standards detailing which activities earn the Community Reinvestment Act (CRA) points essential for any bank’s strategic objectives and national reputation. As discussed below, the new proposal is lengthy, complex, and in some cases analytically daunting or flat-out confusing. Still one critical conclusion is clear: CRA evaluations would switch from the almost monomaniacal focus on mortgages that characterize the rule to a far wider lens encompassing many more community-development, deposit-taking, consumer finance, and small-business activities.

GSE-051622.PDF…

16 05, 2022

FedFin: Minimizing Mortgages, Maximizing Community Service

Arezou Rafikian2023-02-21T15:06:30-05:00May 16th, 2022|The Vault|

As we noted last week, the federal banking agencies sighed a mighty sigh and heaved up a massive inter-agency proposal rewriting decades-old standards detailing which activities earn the Community Reinvestment Act (CRA) points essential for any bank’s strategic objectives and national reputation. As discussed below, the new proposal is lengthy, complex, and in some cases analytically daunting or flat-out confusing. Still one critical conclusion is clear…

The full report is available to subscription clients. To find out how you can sign up for the service, click here.

…

25 04, 2022

DAILY042522

Eliza Allen2023-03-01T15:58:11-05:00April 25th, 2022|2- Daily Briefing|

HFSC Revs Up Repeat-Offender Legislation

As anticipated, the HFSC memo ahead of its hearing on Wednesday with CFPB Director Chopra covers a wide range of issues, actions, and CFPB priorities. The memo also lists many bills pending in the House that touch on the CFPB, but, importantly, also announces a new draft measure to mandate that the banking agencies not only join the CFPB in its campaign to sanction large “repeat offenders”, but also stipulates stiff penalties in such cases based in part on a longstanding measure from Chairwoman Waters (D-CA) to break up “megabanks” found to have repeat compliance failures (see FSM Report GSIB11).

CFPB Claims Expansive Authority over Nonbank Consumer-Finance Companies

Invoking what it describes as “dormant” authority, the CFPB today announced that it will extend its supervisory authority to nonbanks such as fintechs now not expressly covered by its procedures, doing so also for any nonbank consumer-finance company reasonably found by the Bureau to pose consumer risk.

FRB-PHL Finds Worrisome Signs of Mortgage Risk

The Federal Reserve Bank of Philadelphia today announced a monthly survey of mortgage-market risk, concluding in its first analysis that foreclosure rates are in moderate bounds but significant risk pockets are concerning. These include the fact that the Black past due rate is 6.9 percent compared to three percent for whites.

Daily042522.pdf…