#HELOC – Federal Financial Analytics

27 09, 2023

DAILY092723

Eliza Allen2023-09-27T16:36:21-04:00September 27th, 2023|2- Daily Briefing|

FinCEN Bows to BOI Pressure

Responding to bipartisan concerns, FinCEN today issued an NPR to extend the beneficial ownership information (BOI) report filing deadline from thirty to ninety days for companies created or registered in 2024.

Chopra Considering Refi, Point Rules

The CFPB today released its annual report on residential mortgage lending, finding that mortgage applications, originations, and affordability declined significantly in 2022 while costs, loan denials, HELOC originations, and the percentage of cash-out refinances all increased.

HFSC GOP Presses Gensler on Banking-Reg Cumulative Impact

During Chairman Gensler’s as-always contentious HFSC hearing today, Rep. Barr (R-KY) asked if the SEC is in consultation with the Federal Reserve regarding the combined CRE effects of recent SEC proposals and the Basel III endgame standards (see Client Report CAPITAL234).

Carstens Says Law Must Catch Up To CBDC

BIS General Manager Agustín Carstens today emphatically called for rapid development of clear CBDC legal frameworks based on defined rights and obligations for privacy, AML compliance, and user choice.

Daily092723.pdf…

4 08, 2023

FedFin on: Credit-Risk Capital Rewrite

Arezou Rafikian2023-08-04T13:41:04-04:00August 4th, 2023|The Vault|

In this report, we proceed from our assessment of the proposed regulatory capital framework to an analysis of the rules governing credit risk. In addition to eliminating the advanced approach, the proposal imposes higher standards for some assets than under the old standardized approach (SA) via new “expanded” requirements. As detailed here, many expanded risk weightings are higher than current requirements either due to specific risk-weighted assessments (RWAs) or definitions and additional restrictions. This contributes to the added capital costs identified by the banking agencies in their impact assessment, suggesting that lower risk weightings in the expanded approach reflected the reduced risks described in the proposal for other assets and will ultimately have little bearing on regulatory-capital requirements and thus ….

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

4 08, 2023

CAPITAL231

Eliza Allen2023-08-04T13:40:43-04:00August 4th, 2023|1- Financial Services Management|

Credit-Risk Capital Rewrite

In this report, we proceed from our assessment of the proposed regulatory capital framework to an analysis of the rules governing credit risk. In addition to eliminating the advanced approach, the proposal imposes higher standards for some assets than under the old standardized approach (SA) via new “expanded” requirements. As detailed here, many expanded risk weightings are higher than current requirements either due to specific risk-weighted assessments (RWAs) or definitions and additional restrictions. This contributes to the added capital costs identified by the banking agencies in their impact assessment, suggesting that lower risk weightings in the expanded approach reflected the reduced risks described in the proposal for other assets and will ultimately have little bearing on regulatory-capital requirements and thus on the overall ability of banks to expand into lower-risk areas and compete more effectively with nonbanks and foreign banks. Big banks forced to abandon certain activities may expand others receiving capital discounts in the new rules, increasing their footprint in traditional banking in ways that may increase industry consolidation.

CAPITAL231.pdf…

22 12, 2022

DAILY122222

Eliza Allen2022-12-22T16:43:24-05:00December 22nd, 2022|2- Daily Briefing|

Waters Blasts ICE/BKI Merger

Although HFSC Chair Waters (D-CA) frequently opposes large-bank mergers, her stand today against the ICE/Black Knight deal is the first time we can recall her taking a public stand on a transaction before the Federal Trade Commission (outside HFSC’s jurisdiction).

Toomey Sets Agenda for GOP Fed Reform

Among his parting shots, Senate Banking Ranking Member Toomey (R-PA) yesterday introduced legislation to reform the Federal Reserve System.

Toomey Also Tries to Set Stablecoin Agenda

In another effort to set the terms of debate before he departs, Senate Banking Ranking Member Toomey (R-PA) also introduced a new version of his initial stablecoin legislation (see FSM Report CRYPTO27).

Warren Doubts Zelle’s Fraud Policy Changes

Continuing her campaign against Zelle fraud, Sen. Warren (D-MA) today sent a letter to the CEO of Zelle’s parent company demanding a briefing on pending efforts to compensate consumers for fraudulent transfers.

CFPB Cites ARM Risks, Rewards

The CFPB today issued a consumer alert describing the risks associated with various mortgage products during a period of rising interest rates.

Project Hamilton Ducks CBDC-Feasibility Decision

The Federal Reserve Bank of Boston today announced the completion of its Project Hamilton work with MIT on a U.S. CBDC.

Fed to Reconsider Key Bank-Control Criteria

Although the banking agencies today reiterated that their policy is not generally to require reporting of loans to potentially controlling principal-fund complexes or banks that meet passivity requirements, the Fed will now reconsider relevant rules in this sector.

Daily122222.pdf…

17 05, 2022

FedFin on: CRA Regulatory Rewrite

Arezou Rafikian2023-02-21T14:50:17-05:00May 17th, 2022|The Vault|

Following much talk about the need to update Community Reinvestment Act (CRA) rules since this was last done in 1995, federal banking agencies have finally agreed on a proposed redesign of standards essential to banks that wish to expand or acquire as well as those seeking strong community ties and the policy and political benefit these afford. Much of the complexity in the NPR results from the agencies’ decision to allow only partial credit for activities (e.g., mortgages) largely assumed in the past…

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

17 05, 2022

CRA32

Arezou Rafikian2023-02-21T14:50:04-05:00May 17th, 2022|1- Financial Services Management|

CRA Regulatory Reform

Following much talk about the need to update Community Reinvestment Act (CRA) rules since this was last done in 1995, federal banking agencies have finally agreed on a proposed redesign of standards essential to banks that wish to expand or acquire as well as those seeking strong community ties and the policy and political benefit these afford. Much of the complexity in the NPR results from the agencies’ decision to allow only partial credit for activities (e.g., mortgages) largely assumed in the past to benefit low-and-moderate income (LMI) households if they occurred in LMI census tracts as well as to condition product approval on the extent to which LMI-household needs are demonstrably met. Offsetting these restrictions to some extent are broader criteria for eligible community-development and -service activities, but only wholesale and limited-purpose banks will enjoy the full benefit because new weightings require regulators to give the most weight to retail finance at most large banks.

CRA32.pdf…

9 05, 2022

DAILY050922

Eliza Allen2023-03-01T13:21:36-05:00May 9th, 2022|2- Daily Briefing|

U.S. Adopts Powerful Back-Door Campaign vs. Shell Companies, Trusts

In conjunction with a G-7 statement strongly condemning Russia, Treasury took an innovative move to address shell companies linked to the Russian Federation even as FinCEN’s beneficial-ownership rules remain bogged down.

Hsu Promises Deal-By-Deal Review of Large Regional M&A Pending Broad, Forward-Looking Policy

Citing changes in both U.S. banking and inequality since the last round of merger-policy statements in 1995, Acting Comptroller Hsu today called for a new policy that is neither pro- nor anti-merger but rather determines which larger mergers are “good” transactions so that only risky ones are rejected.

SEC Bows to Critics with Longer Comment Periods

In a significant concession to Congressional Republicans and industry critics, the SEC today extended the comment period for two of its most controversial initiatives. The deadline for comments on its climate-risk disclosures is moved forward by twenty-eight days to June 17.

CFPB Takes Administrative Action Expanding ECOA Reach, Lender Risk

Living up to its promise on Friday to address structural racism, the CFPB today issued a new advisory extending its fair-lending enforcement scope under the ECOA to all aspects of a credit transaction, not just loan origination or servicing.

Daily050922.pdf…